Kickoff of Legislative Health-Care Debates: What the New Insurance Bills Mean for You

This week, health care is back in the spotlight as several bills are set for their first hearings. The big question is whether the benefits of expanded coverage are worth the higher costs that come along with them.

Legislators will not only talk about insurance this session. They’ll also dive into federal drug pricing, issues with Medicaid funding, and the future of the state’s largest workers’ compensation insurer. These discussions will focus on why health care costs are climbing and how these changes will affect businesses and consumers.

On Wednesday, a House committee will review a bill that aims to ensure mental health benefits match those for physical health care. Meanwhile, on Thursday, a Senate committee will revisit the idea of a single-payer health care system in Colorado. This bill has been debated for three years and could change how health care is regulated in the state.

Both bills want to lessen the role of private health insurance. For example, Senate Bill 45 calls for a study on replacing the private sector with a single-payer model. Similarly, House Bill 1002 aims to create clear definitions and guidelines for mental health treatment, ensuring that necessary care isn’t denied by insurance providers.

Adriana Hidalgo from Healthier Colorado noted that many people still face challenges accessing mental and behavioral health treatment, despite existing laws intended to ensure equal coverage. Kevin McFatridge, from the Colorado Association of Health Plans, raised concerns that the new bill might lead to more costly treatments being covered without proper checks, which could ultimately raise overall care costs.

Another significant point of debate is Senate Bill 48, which seeks to require insurers to cover treatments for chronic obesity and pre-diabetes, including expensive medications like Ozempic and Wegovy. This bill previously failed due to a hefty price tag, estimated at $200 million for Medicaid alone.

Sen. Dafna Michaelson Jenet, who sponsored both bills, argues that these initial costs could lead to savings over time by reducing the need for expensive treatments for diabetes and obesity-related issues.

Studies show that mandated benefits could add about $140 million annually to private insurers’ costs within five years, resulting in higher premiums for consumers. While these medications can help some, McFatridge warns that mandating their coverage without properly assessing their effectiveness could further drive up health care costs.

Governor Jared Polis has expressed his focus on lowering health care costs. He has been cautious about approving new mandates that may increase expenses, although he has approved some in the past.

Another key issue on the horizon is the future of the 340B drug pricing program. This program offers discounts to hospitals serving a significant number of publicly insured or uninsured patients. Recently, the governor indicated support for maintaining this program as hospitals face soaring operating costs. Some legislators have introduced a bill, SB 71, which would prevent drug manufacturers from limiting pharmacy discounts for hospitals.

Additionally, a bipartisan group is tackling the role of pharmacy benefit managers (PBMs) in the prescription drug industry. A new bill would restructure how these managers operate, prohibiting them from profiting from the cost of drugs while earning fees for services rendered.

Cost versus benefit remains a central theme in these discussions, especially as lawmakers face a significant budget shortfall linked to rising Medicaid costs. Medicaid has seen increased expenses due to a higher level of care needed by its members, prompting concerns about sustainability in provider reimbursement rates.

Lastly, there’s a looming debate about privatizing Pinnacol Assurance, the state’s workers’ compensation insurer. While this may offer some advantages, lawmakers are weighing the potential impact on care quality for those who rely on Pinnacol.

While this year’s agenda may not be as extensive as previous sessions, the sheer volume of proposed legislation suggests that significant changes in Colorado’s health care landscape are on the horizon. Stakeholders are concerned about how these changes will affect the cost and quality of health care for Coloradans.