When Gov. Jared Polis was sworn into office five years ago, saving Coloradans money on health care was his number one policy priority carried into office from his campaign. Since then, despite an interruption from the COVID pandemic, each legislative session has generated a fistful of bills and associated press releases hyping the state’s success in achieving health care savings. Truth be told, there has been virtually no progress in curtailing Colorado’s medical insurance premiums. Just as across the rest of the country, costs keep climbing. Only at the margins has there been any savings.

While I served in the legislature, Democrats joked Republicans seemed obsessed with monitoring personal behavior. If anyone, anywhere, appeared to be having fun, Republicans introduced legislation to bring their joy to a halt. As information-age capitalism has funneled more and more profits to a handful of mega-billionaires in recent years, it’s been Democrats who have opted to punish anyone who may have figured out how to get rich. It’s popular politics. Polls find even a majority of Republicans want to see the billionaire club pay its fair share in taxes. A close look at House Bill 1094, which imposes restrictions on how pharmacy benefit managers (PBM) bill for their services, is designed to restrict their earnings and, ostensibly, “save money on prescription bills.”

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PBMs appear to be what their critics accuse them of being: middlemen. The implication, of course, is they impose higher costs without providing added value. That would be wrong. When I was staying in New York last November, just a block from the sidewalk where the chief executive of United Healthcare was assassinated a few weeks later, I noticed full-page ads in the New York Times declaring, “Keeping medication costs under $250 per year for millions of patients. That’s not a middleman. That’s an advocate.” This message is still running today, sponsored by Express Scripts, an affiliate of Evernorth Care Solutions.

There are few nastier legislative squabbles than turf battles. Yes, PBMs operate in the space between “Big Pharma” and smaller employer and pension health benefit plans, as well as on behalf of rural, independent pharmacies as noted recently by former legislator Donald Valdez from the San Luis Valley. Though the largest plans and pharmacy chains can negotiate volume discounts for themselves, it is PBMs that aggregate demand from their clients to achieve similar savings. Much like trial lawyers and real estate agents, they only earn a commission when they succeed in delivering cheaper drugs to clients. HB-1094 imposes a flat fee on all purchases, which fails to gauge the savings delivered.

Why, may you ask, is the legislature interfering with these consensual agreements? Many PBMs earn a lot of money is the answer. If fees are capped, we are asked to assume this limit will “save money on health care costs.” There are ample reasons to question this theory. Outside analysts estimate HB 1094’s flat fee requirements will increase statewide prescription costs somewhere between $118 million and $426 million dollars annually, driving up Colorado premiums by a minimum of nearly $100 per month. If these estimates are correct, it would substantially increase the cost of health coverage for state employee health plans, negatively affecting the state budget when we are looking for savings.

No fiscal note, aside from an administrative filing system costing $10,000 dollars, was provided by Legislative Council. Fortunately, New Mexico took a deeper look at their likely budget impact before killing a similar proposal (SB62) in Santa Fe. Only one-third the size of Colorado, our neighbors projected a budget hit of $60 million, growing by 9% in subsequent years. Ooops! There are significant structural problems with the delivery of American health care. It costs too much and our public health results lag behind other G7 nations. Fiscal relationships are convoluted and complicated. If health care plans could rely on drug companies to set reasonable prices there would be little role for PBMs. Realistically, they serve a need, particularly in rural Colorado.

There has been increasing comment the real challenge facing our democracy is its inability to get things done. Canadians build their roads at half our cost. The Chinese have constructed 23,000 miles of high-speed rail in this century, while California might have 250 miles of its 500-mile project completed by 2028 (although future funding is threatened by DOGE). A recent discussion of Colorado childcare costs reported two dozen bills introduced during the past four years. Only three had the potential to reduce costs, while 21 imposed additional reporting and compliance requirements driving up actual expenses for childcare operators. HB-1094 is a solution in search of a problem, accompanied by unanticipated consequences. Now that the House Appropriations Committee is considering the bill, it seems advisable to request a more complete fiscal note.

During Dana Crawford’s memorial celebration at Union Station the week before last, a group of her former employees were discussing Dana’s canny capacity for threading projects over and around bureaucratic hurdles. Rick Garcia, who has served as both the federal District 8 HUD manager and, more recently, as Colorado’s director for the Department of Local Affairs — well acquainted with the difficulty of getting projects built — observed, “No one ever said democracy was cheap or quick.” Sadly, this is too often true, although readily corrected.

Miller Hudson is a public affairs consultant and a former Colorado legislator.