Colorado is projected to save money by covering abortions for Medicaid, Child Health Plan Plus recipients

Democrats' efforts to close the gap between the right to end a pregnancy in Colorado and the cost of the procedure by letting health insurance safety net programs pay for abortions is expected to save the state money, according to an analysis by nonpartisan legislative staff.

That's because some Medicaid and Child Health Plan Plus recipients aren't getting abortions because of the cost. And it's cheaper to end a pregnancy than to deliver a baby.

The Medicaid and Child Health Plan Plus abortion coverage would be offered starting in 2026 as part of the passage in November of Amendment 79, which enshrined abortion access in the state constitution and allowed public funds to be used to pay for the procedure, and once Democrats in the legislature sign off on Senate Bill 183.

Voters approved the ballot measure by a 24-point margin and Senate Bill 183, which implements the initiative by completing the public funding for abortions piece, is cruising through the Democratic-controlled Capitol.

Private insurers had to begin covering abortion access for their clients this year under a bill passed by Democrats in the legislature in 2023. Supporters of Amendment 79 and Senate Bill 183 feel it's only fair that people getting public assistance for their health care coverage get the same benefit.

Nonpartisan analysts estimated in a fiscal note for the bill that about 5,500 Medicaid and Child Health Plan Plus recipients in Colorado will seek an abortion each year if the cost is covered by the state. Most of those would end their pregnancies whether the procedure was covered or not, but as many as 1,700 patients would give birth.

Since the average reimbursement cost of labor and delivery — $3,850 — is more than the average reimbursement cost of an abortion — $1,300 for a procedural abortion and $800 for a medication abortion — the state will save at least $550,000 a year by paying for abortion care.

"In the first full implementation year, costs for abortion services are estimated to be $5.9 million, while cost savings for averted births are estimated to be $6.4 million," the fiscal note for Senate BIll 183 says.

The long-term savings could be even greater.

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"Medicaid-covered births typically involve additional social safety net impacts for the child, whereas abortion care services represent a one-time expenditure," the fiscal note says. "These impacts have not been addressed in this fiscal note."

Proponents of Amendment 79 and Senate Bill 183 didn't bring the measures to save the state money. They wanted to ensure abortion access in Colorado.

But they say the government savings are an added plus.

Sen. Lindsey Daugherty, an Arvada Democrat and one of the lead sponsors of Senate Bill 183, said the measure "ensures Colorado is a beacon for access to safe and affordable reproductive health care in every aspect — from our constitution to our state law to our budget."

Amendment 79 also allows Colorado's insurance plan for state employees to cover the cost of abortions.

Nonpartisan staff believe covering abortion access for state employees will cost about $200,000 a year, raising premiums by about 0.041%, or 50 cents, per member per month.

That brings the total combined state savings from Amendment 79 and Senate Bill 183 to about $350,000 a year.

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The fiscal note pointed out that since federal law prohibits federal dollars from being used to pay for most abortions, the state would have to cover the full cost of abortion for Medicaid and Child Health Plan Plus recipients. The cost of those programs is split between the state and federal government.

The cost savings, however, means the federal dollars can be used to offset the state's financial burden for Medicaid and Child Health Plan Plus elsewhere.

The fiscal estimates are based on what nonpartisan staff described as a "small study" in Louisiana in which researchers looked at how many pregnant women would have gotten abortions had the procedure been covered by Medicaid.

"For a substantial proportion of pregnant women in Louisiana, the lack of Medicaid funding remains an insurmountable barrier to obtaining an abortion," according to the study published in BMC Women's Health, a peer-reviewed journal.

Senate Bill 183 passed the Senate last week 22-12 along party lines. It's now awaiting a hearing in the Health and Human Services Committee.