ICYMI: ‘Third Time Is No Charm’
Apr 2, 2021
DENVER – Last week, the Common Sense Institute (CSI) released a new report detailing the economic consequences of House Bill 21-1232 that seeks to create a government-controlled health insurance system in Colorado for “the third attempt in less than 18 months.” The findings provide additional evidence for lawmakers that creating a state government option – no matter how many times they attempt to do so – would be a step backwards for affordable, high-quality health care.
The report finds that while the latest version of the legislation has some differences in its approach, it remains an unaffordable proposal that “does not avoid the economic impacts and unintended consequences of earlier proposals.” The newest version of the proposal continues to present “serious consequences for Colorado’s health care sector and the employer-sponsored health plans where most Coloradans obtain health care coverage.”
- The latest proposal also gives authority to create a new state entity, which could begin selling “standardized plans” by 2025, with premiums more than 30 percent below projected levels.
- Lower payment levels would be set for all providers, and physicians, nurses, chiropractors, hospitals and many others, would be required to accept the new state option, or face disciplinary action, including the loss of their license to treat patients.
- Since HB21-1232 cuts prices without reducing the costs of delivering care, health providers would be faced with a critical choice to CUT services and access to care or PASS the costs of the Colorado option plan to all others.
- Colorado’s health care system would face revenue cuts from $830 million to $1 billion in 2024.
- Between 3,900 and 4,900 health care workers could lose their jobs – at the top end that is roughly 2 percent of all health care jobs in Colorado.
- Health care providers may be forced to pass along the costs of the Colorado option plan to commercial payers. This additional cost on employers and workers would create a drag on the state economy, causing a net loss of 4,300–5,400 jobs and a loss of $470 million in annual personal income.
The economic modeling in the report finds lawmakers made glaring miscalculations with HB21-1232 and Colorado Politics reports, “The bill, as written, fails to consider inflation, population growth and other costs.”
The report concludes, “The third and latest iteration of a public option proposal for Colorado once again relies on government mandates on prices and participation, a fact that should draw serious scrutiny about the long-term impacts it would produce for Colorado…Getting the rules and regulations surrounding our shared health care sector right is critical for both the affordability and quality of the system our lives depend on.”
- To read the full Common Sense Institute report titled “Third Time Is No Charm,” CLICK HERE.