Latest Rejection Of Unaffordable State Government-Controlled Health Insurance System Serves As Warning To Other States

DENVER – In California, state lawmakers have rejected a proposed one-size-fits-all, new government health insurance system, serving as a warning to policymakers in other states of the unaffordable costs and consequences of similar proposals.
  
As The Wall Street Journal reports, “[l]eaders in the Democratic-dominated lower chamber of the California legislature were preparing to bring the bill to a vote Monday afternoon, the deadline for it to advance and potentially be passed into law later in the year. [The bill’s] author, Assemblyman Ash Kalra, pulled it from consideration when it became clear it wouldn’t pass.”

This rejection of a one-size-fits-all health insurance system in California follows the failure of a similar 2017 proposal, then estimated to cost state taxpayers $400 billion per year.

The failure of one-size-fits-all health care in California follows similar failures in other states.

• In Washington, the only state to have implemented a state government-controlled public option, the policy has resulted in higher premiums for public option plans than private-sector plans, PEW’s Stateline reports.
• In Vermont, lawmakers passed a one-size-fits-all health care law in 2011 but abandoned it when it proved unaffordable for the state’s taxpayers. Implementing a single-payer government health insurance system could have led to 11.5 percent payroll assessments on businesses and sliding premiums up to 9.5 percent of individuals’ income. 
• In Connecticut, lawmakers shelved a proposal to create a new state government-controlled health insurance system in the face of opposition from a broad coalition of key stakeholders—including the health care community, economic leaders, organized labor and the governor. Research reveals that creating the state government option in Connecticut could lead to higher taxes and higher premiums for the state’s residents.
• In New Mexico, lawmakers also abandoned a proposal to create a state government option, mainly due to the unaffordable costs, ultimately advancing a bill to study the issue instead.  
• In Oregon, the push to create a state government-controlled health insurance system has been stalled for years due to the potential unaffordable costs and consequences. 
• In Illinois, where Governor J.B. Pritzker campaigned on the state government option, there has been no movement to create one. Instead, Pritzker has signed legislation that builds on what’s working in our current system. 

Today, private plans and public programs are working together to provide Coloradans with access to affordable, high-quality health coverage and care.

In yet another sign that our current health care system is expanding access to affordable, high-quality health coverage and care, Colorado Newsline and ABC 7 Denver report that 198,412 people enrolled in health coverage through Connect for Health Colorado during the open enrollment period which ended on January 15. 

• This is more than a 10 percent increase in enrollments over the same period last year, and KMGH reports that this figure nearly matches the 226,680 people who signed up for coverage on the state exchange in all of 2021, when there were extra open enrollment periods due to the pandemic. 
• Notably, of those who signed up for plans during open enrollment, three-quarters received savings, with an average savings of 52 percent. 

As Colorado’s government takes steps to implement a new state government-controlled health insurance system known as the “public option” or “Colorado Option,” the strong results from this open enrollment period are a reminder of how private plans and public programs are successfully working together to expand access to affordable, high-quality health coverage and care. 

At the same time, a new analysis by NovaRest, an independent actuarial consulting firm with extensive experience supporting state and federal insurance regulators, warns that implementing the “Colorado Option” poses serious potential risks to Coloradans’ access to affordable, high-quality health coverage and care.

Instead of implementing a new state government-controlled health insurance system that could threaten Coloradans’ access to quality coverage and care, policymakers should instead focus on proven solutions that strengthen what is working today, including supporting greater participation in existing health coverage resources that help Coloradans get healthy and stay healthy.