9E9C1DFBE080B600872584EB0064AF37 Hearing Summary

Michael Conway, Commissioner, Division of Insurance, and Kim Bimestefer, Executive Director, HCPF, presented on House Bill 19-1004: Proposal for Affordable Health Coverage Option and distributed handouts to the committee (Attachments C and D).  Comissioner Conway reviewed the language in House Bill 19-1004 requiring the development of a state health insurance option.  He described the stakeholder involvement in development of the state health insurance option.

Commissioner Conway described DOI and HCPF's recommendation for a state health insurance option (option) to the committee.  He explained that the option would be administered by private insurance companies and would result in at least two health insurers offering individual insurance plans in every county in Colorado.  Commissioner Conway further explained that under the option, the state would set hospital reimbursements rates.  He described a budget request for the state to begin implementing the option. 

Commissioner Conway responded to committee questions.

Commissioner Conway described the benefits that would be included in plans offered through the state health insurance option, and which Coloradans would be eligible to purchase the plans.  He discussed the possibility of obtaining a federal waiver prior to implementing the option. 

Ms. Bimestefer described the creation of an advisory board to guide implementation of the option.  She explained the cost containment measures in the option pertaining to drug manufacturers, insurance companies, and hospital reimbursements.  Ms. Bimesterfer further described hospital profits and reimbursements in Colorado, compared to other states.

Commissioner Conway described the transparency and reporting measures that would be required for the option.  He discussed the possibility of cost shifting and the amount of hospital reimbursements in the public option plan.  Commissioner Conway and Ms. Bimestefer responded to committee questions regarding federal subsidies, rebates from drug manufacturers, the advisory board, and competition in the private insurance marketplace.

Committee members continued to dialogue with Commissioner Conway and Ms. Bimestefer.  Commissioner Conway indicated that insurance companies would offer plans in rural areas of the state if the hospitals rates are negotiated in advance by a third party.  Discussion about the hospital rate setting method and cost shifting followed.

Committee questions continued about issues insurers will face when deciding to offer a plan through the option and continuing to offer traditional plans.  Committee discussion focused on the structure and role of the advisory board created under this option.

Committee questions continued regarding Colorado's hospital costs and profits compared to the national average of hospital costs and profits.  Ms. Bimestefer responded to questions about the value of the Colorado Healthcare Affordability and Sustainability (CHASE) fee to Colorado hospitals.

Representative Lontine told the committee that the remainder of questions regarding House Bill 19-1004 may be directed to Commissioner Conway and Ms. Bimestefer directly.

Representative Lontine recessed the meeting.