Colorado: Anthem & Rocky Mountain HMO reverse their decision to pull out of ACA market thanks to emegency subsidy legislation

Last week I noted that Colorado legislators passed (and Gov. Polis signed) legislation to scrape together up to $100 million in emergency funding to backfill perhaps 40% or so of the federal tax credits the state expects their ~225,000 subsidized enrollees to lose in 2026 when the enhanced IRA credits expire this December:

Via Colorado NewsLine:

...The Senate then approved House Bill 25B-1006, which would sell tax credits to bring in money for the Health Insurance Affordability Enterprise fund. That pays for programs to reduce individual insurance market premiums.

The bill aims to raise $100 million for that enterprise to soften the impact of the expiration of federal enhanced premium tax credits. Health insurance premiums for people who buy insurance on the individual market are expected to face an average of a 28% increase next year, with higher increases along the Western Slope.

My colleague Louise Norris pointed me towards this analysis which states that the amount of federal funding being lost is around $230 million. $100 million, assuming they're able to bring in that much, would cancel out perhaps 43% of this.

In the same post I also noted that two major Colorado ACA carriers, Anthem and Rocky Mountain HMO, were threatening to drop out of the state's ACA exchange entirely due to the lost subsidies; if this happened, around 96,000 Coloradans would lose coverage and have to scramble to find another carrier.

Fortunately, it looks like the $100M influx of premium assistance is satisfactory to both carriers:

Rocky Mountain HMO and Anthem Withdraw Discontinuances in the Colorado Individual Health Insurance Market

• The decision to return and offer services came after the Colorado General Assembly passed legislation to provide $100 million to stabilize the individual healthcare market; loss of enhanced premium tax credits still threatens market stability

DENVER - The Colorado Division of Insurance (DOI), part of the Department of Regulatory Agencies (DORA), today announced that Rocky Mountain HMO and Anthem’s HMO Colorado have withdrawn the discontinuances of health care plans they filed in August. Thanks to the leadership and actions of Governor Polis and the legislature, both companies will continue services in all counties they covered in the 2025 plan year. The discontinuances of plans between the two carriers would have affected 96,000 Coloradans.

“I’m glad that Governor Polis’s leadership helped ensure that both Rocky Mountain HMO and Anthem have decided to pull back the discontinuances they initially filed and I appreciate their partnership during this difficult year, along with the other carriers in the market,” said Colorado Insurance Commissioner Michael Conway. “This would not have been possible without the Colorado General Assembly passing legislation to stabilize the individual health care market by blunting some of the premium increases. But, as I keep saying, the expiration of the enhanced premium tax credit is the biggest threat to market stability. If Congress doesn’t extend them, at the beginning of next year, most Coloradans enrolled in the individual market will see their premiums skyrocket and tens of thousands of Coloradans will lose coverage. If Congress doesn’t act, the pain will be unspeakable.”

I should also note that the $100M legislation should also result in a significant drop in gross premium rate hikes, which will help ease the massive spike for unsubsidized enrollees as well:

Colorado will ask health insurance companies — which have proposed dramatic price increases for 2026 — to file new rates taking into account funding made available during the state legislature’s special session.

The move is expected to lead to smaller price increases next year for people who buy health coverage on their own without the help of an employer, Colorado Insurance Commissioner Michael Conway said.

...The special-session fix is also just a one-year deal. Conway said lawmakers will still need to come back during next year’s regular legislative session to find a longer-term solution to funding various affordability programs.

...One of these programs helps insurers pay for high-cost claims, allowing insurers to keep prices lower for everyone. The other program is what state officials are calling a “premium wrap.” It is essentially a state-funded subsidy to help lower-income people pay for their insurance premiums.

Combined, Conway is optimistic that the funding will knock 11 or 12 percentage points off insurers’ proposed price increases for 2026. So that would take the average increase from 28% down to around 16%.

It's important to keep this in perspective, however: In any other year, a 16% gross premium increase would be considered at the high end of the spectrum nationally instead of at the lower end, and many enrollees are still looking at paying up to twice as much or more.

Still, again, it's much better than nothing.