Colorado’s insurance commissioner has called on the federal government to establish a national reinsurance program similar to that of Colorado and a dozen other states.

“As state budgets are impacted by the pandemic, federal funding to help support and establish reinsurance programs will allow states to prioritize other vital areas that need relief while utilizing federal funds for our reinsurance programs,” Michael Conway wrote to the state’s congressional delegation in a letter dated May 7. “That will become even more important as more people begin to turn to the individual market if they lose their employer-based coverage during this economic downturn.”

The Colorado Health Institute estimated that reinsurance, which entails insurance against the most expensive health claims, lowered premiums on the individual market by approximately 20% statewide for 2020. The state received federal approval to operate such a program in July 2019, and it made a particular difference on pricing on the Western Slope and Eastern Plains.

“Metro areas such as Boulder, Colorado Springs, and Denver, will see price drops of less than 18%, because the starting prices in these areas were lower,” the institute wrote.

Conway requested that Congress establish a similar federal initiative in the next coronavirus-relief legislation, but allow states with existing programs to maintain those.