Stop passing legislation to increase health insurance premiums | OPINION

Coloradopolitics.com (CO)

Health insurance providers are continually scolded to bring down health care premiums in Colorado. In fact, they are statutorily mandated to do so to the tune of a 15% reduction for Colorado Option plans. Yet, the 2024 legislative session is already loaded with numerous bills that take away tools from carriers who reduce unnecessary costs to the health care system, employers and individuals. Your health insurance premium is a direct reflection of the costs of providers, hospitals and drugs, and yet bills introduced so far during this legislative session will increase those costs substantially.

Take for example, HB24-1149, a bill that would erode health insurance providers' ability to contain pharmaceutical costs even though prescription drug costs account for almost a quarter of the premium dollar and continue to rise. This bill, among other things, directs health insurance providers to create prior authorization exemption programs for prescription drugs, hindering efforts to ensure the lowest cost, safest pharmaceuticals are the first resort for patients.

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Another well-meaning piece of legislation, SB24-054, would direct carriers to cover GLP-1s such as Wegovy and Ozempic, the weight loss drugs that almost bankrupted North Carolina's state employee health insurance plan, resulting in that plan's trustees to vote to remove coverage of them. Estimates show the average wholesale cost for GLP1s per individual utilizer over 36 months is $46,000. Whether intended to be so or not, both policies are a beautifully wrapped gift for the pharmaceutical industry. Coloradans will just pay more for their health insurance because insurers are required by law to ensure these costs are reflected in premium.

Two other bills, HB24-1010 and HB24-1218, contemplate allowing providers to essentially set their own rates for drugs and non-emergent ambulance services. In a time of increasing consolidation of hospitals and provider practices, health insurance providers continue to lose the leverage to negotiate the lowest rates for their members' benefit, given laws that require carriers to have a certain number of providers in their networks. For example, HB 1010 removes the ability of a health insurance provider to leverage negotiations with specialty pharmacies that result in the lowest price to the patient for certain high-cost specialty drugs. Instead, carriers will be required to pay the average 23% markups added on by providers administering these extremely expensive medications — that's after the provider is paid for administering the medication to the patient.

Other bills that will increase your insurance premiums include mandatory coverage of biomarker testing (SB24-124) and arbitration of health insurance claims (SB24-163). These bills are on top of the many bills passed between 2019 and 2022 that we estimate have already increased fully insured premiums in Colorado at a minimum of 5.52% to 7.92% (or $320 million to $405 million annually).

There are two ways to save people money on health care — reduce the services/products/medications covered or reduce the prices paid for those services/products/medications. Unfortunately, policies proposed by the Colorado General Assembly limit insurers' ability to negotiate lower costs and expand coverage requirements while messaging such legislation will "save people on health care." To the contrary, the legislation will result in Coloradans paying more for health care by way of increased premiums. We hope Gov. Jared Polis will fulfill his ongoing promise to save people money on health care and require more thoughtful consideration of the cost impacts of the General Assembly's current proposed policies.