2020 OPEN ENROLLMENT ENDS (most states)

Time: D H M S

Colorado pushing forward with ACA reinsurance waiver request bill

OK, I'm not sure how this one slipped by me...over the past year, a half-dozen states having 1332 Waiver Reinsurance programs approved by CMS (among the few modifications of default ACA provisions approved by the Trump Administration that I agree with).

The states approved have included red ones like Wisconsin and Alaska...but also blue ones like Maryland and New Jersey. For whatever reason, CMS Administrator Seema Verma, while doing all she can to sabotage the ACA in other ways, seems to have a soft spot in her heart for reinsurance, which I'm not going to complain about.

In any event, along with the states which have already had their reinsurance waivers approved, there are several other states where reinsurance proposals have been proposed by either state legislators or governors, including the newly-elected governors of Michigan (Gretchen Whitmer) and Connecticut (Ned Lamont) respectively.

Well, it looks like you can add Colorado to the list...and in their case, they have actual legislation ready to go:

I had the chance Wednesday night to voice Connect for Health Colorado’s support for HB19-1168 before the state House Health and Insurance Committee. The bill, which is sponsored by members of both parties in both chambers of the Legislature, would authorize the state insurance commissioner to apply for a state innovation waiver to allow Colorado to implement a reinsurance program to assist health insurers in paying high-cost insurance claims.

If enacted, the bill would provide significant relief on health insurance premiums in the individual market – on and off the Marketplace— particularly in rural areas. This aligns well with our mission to increase access, affordability and choice in the health insurance market. The committee voted to move the bill forward to the Appropriations Committee.

The insurance commissioner led off the conversation with this presentation.

Kevin Patterson, MURP, MPA
Chief Executive Officer
Connect for Health Colorado

The actual text of the bill doesn't lock in the reinsurance program's attachment points or other details; instead it leaves it open by laying out the paremeters for impact on unsubsidized premiums in specific rating areas throughout the state:

THE COMMISSIONER SHALL SET THE PAYMENT PARAMETERS AT AMOUNTS TO ACHIEVE:

(I) A REDUCTION IN CLAIMS COSTS OF BETWEEN THIRTY AND THIRTY-FIVE PERCENT IN GEOGRAPHIC RATING AREA NUMBERS FIVE AND NINE;

(II) A REDUCTION IN CLAIMS COSTS OF BETWEEN TWENTY AND TWENTY-FIVE PERCENT IN GEOGRAPHIC RATING AREA NUMBERS FOUR, SIX, SEVEN, AND EIGHT; AND

(III) A REDUCTION IN CLAIMS COSTS OF BETWEEN FIFTEEN AND TWENTY PERCENT IN GEOGRAPHIC RATING AREA NUMBERS ONE, TWO, AND THREE.

Colorado has 9 geographic rating areas. This bill would target reducing premiums in each of them, just by varying amounts. As far as I know, this is the only reinsurance bill which differentiates between rating areas in overall claim cost reduction, but I could be wrong. Anyway, stay tuned...