Steamboat Pilot & Today

At a time when political bipartisanship is a rare event, state leaders from both parties and business and consumer groups successfully reached agreement on a matter of real substance. Even more surprising, it was about health care reform.

Key Republican and Democratic legislators, with an assist from Gov. John Hickenlooper, successfully achieved consensus on a structure for a health benefit exchange in Colorado. The result was Senate Bill 200, sponsored by a top Democrat in the Senate and the Republican House majority leader. The legislation passed both houses of the Colorado General Assembly and soon will be signed into law by the governor.

In addition to bipartisan legislative support, SB 200 was backed by one of the most diverse consumer and business coalitions in the history of the legislature. It enjoyed the support of dozens of consumer groups as well as organizations such as the Colorado Association of Commerce and Industry, National Federation of Independent Businesses, Colorado Concern, Colorado Competitive Council and Denver Metro Chamber of Commerce. When partisanship became an issue during the process, these business groups wrote to legislators stating that the legislation “embodies solid policy components reflecting the specific and unique needs of Colorado and ensures the Centennial State will control its destiny regarding the implementation of federal health reform.”

The health benefit exchange that will be created by this effort will provide consumers and small businesses with a one-stop marketplace where they can find information about health plans and health insurance policies and where they can enroll in whatever plan they choose. The exchange will allow users to compare health insurance options based on price, benefits, services and quality. It will foster greater competition based on price and quality as well as provide a level playing field for private health insurers to comply with consumer protections and benefit requirements.

The exchange doesn’t restructure the current system; instead, it simply offers one more option for purchasing health coverage. Individual consumers and small businesses are free to use the exchange or any other available method to get insurance. Still, the exchange has the potential to create a more efficient and competitive market by pooling more people together. A well-functioning exchange could reduce costs, improve quality and increase transparency for consumers and businesses.

Under the rules of the national health care reform law, states must demonstrate by 2013 that they are sufficiently prepared to implement a health benefit exchange. If states are unwilling or unprepared to do so, a federally run exchange (yet to be described in any detail) would be implemented by Jan. 1, 2014. Only Florida and Louisiana have elected not to implement a state-run exchange.

Colorado is wise to move forward with its own exchange. Unlike the federal option, SB 200 creates a Colorado-specific solution to meet the unique needs of the residents in our state. It will create a nonprofit organization to oversee the establishment and operation of the exchange. Most importantly, it requires an open and public process for creating the exchange, with open meetings, open records and clear conflict-of-interest policies and accountability.

The exchange itself will be a nonprofit organization governed by a board of directors composed of nine voting members appointed by the governor and state legislature and three nonvoting members representing three key state departments. A 10-member Legislative Health Benefits Exchange Implementation Review Committee will guide implementation, review operational plans and grant applications, carry legislation and make other recommendations.

This legislation represents only the first step in a much longer process. Many difficult and controversial decisions still need to be made. One of the first will be the selection of the board of directors, who will be appointed by the end of June.

SB 200 is currently the only bipartisan state health insurance exchange bill to have passed in the United States. It represents an important step forward. The majority of Colorado’s residents want our elected representatives to work together toward a common good and avoid political deadlock. The passage of the health insurance exchange bill proves that it’s possible.

Bob Semro is a health policy analyst with the Bell Policy Center, a nonprofit, nonpartisan think tank based in Denver.