Across the state, consumers will experience an average cost reduction of 18.2 percent on plans.
Governor Jared Polis recently announced a tremendous 18.2 percent average Colorado health insurance exchange premiums reduction for 2020. This will apply to state residents who purchase theirhealth plans through the Affordable Care Act marketplace.
This is expected to provide over 200,000 Colorado residents with premiums relief.
This premiums reduction affects only consumers who purchase their coverage through the Colorado health insurance exchange. It does not impact those who receive their coverage from the government or through their employers.
The state estimates that about 200,000 people in Colorado purchase their health insurance by way of the Affordable Care Act’s marketplace. Many of these consumers are self employed or do not have a health plan through their job’s benefits.
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For the last few years, many consumers have found the Colorado health insurance exchange expensive.
Rural Colorado residents have been particularly affected by very high prices for their coverage. In fact, for some, the cost of premiums is the highest monthly expense they pay.
“For a family of four, it’s very common for that family to actually spend more on health insurance than they do on their mortgage,” said Peak Health Alliance’s Tamara Dragstveit in a KDVR report.
That said, the state has now purchased a new reinsurance program. This move was made to help sharply reduce the cost of premiums to state residents, including in rural areas. The reinsurance coverage allows insurers to file a claim to their reinsurance company to be reimbursed for medical costs associated with patients who make very large claims.
“Reinsurance essentially takes the highest-cost cases — cases with hundreds of thousands of dollars in reimbursements — and prevents those cases from driving up rates for everybody else,” explained Governor Polis at a press conference earlier this week. This has made it possible for the Colorado health insurance exchange to see the largest ever premiums drop, beginning with the premiums for 2020 plans. This strategy was first developed earlier this year and made it through legislation at the General Assembly. “By bringing down rates, we will make a dent in the number of uninsured,” added Polis.