It was only a matter of time before the state government’s intervention in Colorado’s health insurance market would fall short of its goal of lowering premiums. Far short, as it turned out.

On Tuesday, as The Gazette reported, the state released startling figures showing Colorado’s insurance premiums in fact will rise by over 10% next year in the small group health insurance market. Premiums will go up more than 7% for individual health plans.

The many Coloradans who obtain their household health coverage through large-group plans offered by their employers face challenges of their own, of course.

But the picture is downright bleak for many households whose breadwinners work at small businesses that must rely on small-group plans. The same goes for those who are self-employed or whose jobs don’t come with insurance. They must turn to costly individual insurance plans.

Not only are their premiums on average spiraling upward, but as the trade association representing Colorado’s health plans pointed out in a news release, there are now fewer carriers offering the individual and small group plans and less competition as a result. Several insurers including, most recently, Humana, have announced they are pulling out of all or part of Colorado’s small-group and individual insurance market.

The state’s new “Colorado Option” policy, championed and signed into law last year by Gov. Jared Polis, is a state-designed range of health plans that insurers must start offering alongside their other plans on Jan. 1. The Colorado Option plans must offer mandated, and thus costlier, types and levels of coverage.

Ironically – but not surprisingly – some of the traditional health plans that the insurers continue to offer in the same markets are cheaper.

Those plans can offer the basics that small employers and individual consumers need and can omit or limit kinds of coverage consumers would prefer to do without. Which is how they save money.

Health insurers as well as employers in general – through which most working Coloradans and their dependents get their health coverage – have opposed the Colorado Option. They have predicted it only would make a complicated and costly health insurance market worse. And that’s just what has happened.

“During the program’s first year, four prominent health insurance carriers have notified the DOI they will either completely exit the Colorado market, or exit the state’s important small group market, further decreasing choices for employers and disrupting Coloradans’ access to the doctors and providers they depend on for their care,” Colorado’s Health Care Future, an advocacy group representing employers, declared in a news release the day the state released the premium increases.

“When you peel back the layers, initial review of 2023 premium data suggests that this newly created one-size-fits-all system (of government mandates and regulations) is failing to deliver the savings politicians promised as they rushed to push the new program through the state Legislature.

“It’s time for Colorado to build on what is working in health care rather than doubling down on a failing experiment that is disrupting Colorado’s health system, increasing prices for consumers, and resulting in fewer health insurance carriers and less competition.”

Amanda Massey, who heads the Colorado Association of Health Plans, also was sharply critical, saying, “The decisions made by the Polis administration regarding the Colorado Option were fundamentally contradictory to the stated goal of saving people money on health care.”

“We fully support market-based policies that actually drive down costs, but the result of Colorado’s first-in-the-nation policy shows the administration chose politics over math.”

Many fixes are needed to make health coverage more affordable across our state. But as a doctor could have told the governor, first, do no harm.

Denver Gazette Editorial Board