Colorado Option Plans Save Coloradans Money

The Colorado Option Standardized Plan is working to make coverage more affordable and easier to understand, according to new Mathematica analysis findings

DENVER - Today, the Colorado Division of Insurance (DOI), part of the Department of Regulatory Agencies (DORA), shared a new, independently-conducted analysis by Mathematica, a public policy research organization, showing that the Colorado Option is saving Coloradans money. On average, Colorado Option plans have lower premiums in many counties and lower out-of-pocket spending by enrollees. Enrollment in the Colorado Option has increased year over year since its introduction in Plan Year 2023.

"We are proud to offer Coloradans a standardized plan that's designed to be simple to understand and easy to use for consumers," said Colorado Option Director Sara Bencic. "Good health coverage can save lives, and we will continue to ensure that the Colorado Option provides the best for the people of our state."

This analysis was required by HB21-1232, the bill that established the Colorado Option, and is meant to assess the impact of the Colorado Option on health plan enrollment in the individual and small-group health insurance markets, health insurance affordability in those markets, and health equity. The analysis found that the program is achieving its statutory goals of lowering monthly premiums, reducing out-of-pocket spending, and simplifying the insurance shopping experience for individuals and small businesses.

Key analysis findings include:

• Cost savings for Coloradans. Consumers who purchased the Colorado Option paid $33 less per month on average with a Bronze plan. Enrollees in Colorado Option Silver and Gold plans paid $18 and $14 less per month, respectively. Enrollees also had 15% lower out-of-pocket costs compared to consumers enrolled in a non-Colorado Option plan.
• $0 services make health insurance more usable. Colorado Option plans offer a range of services at no cost, like primary care visits, behavioral health office visits, and prenatal/postnatal care. Consumers like the simplicity of the plan designs and that the $0 costs make coverage easier to understand.
• Implementation of other Colorado Option goals are on track and in place. Carriers and providers are negotiating lower reimbursement rates for Colorado Option plans, backed by a public-hearing process, to help move underlying prices toward premium targets.
• There is still room to grow in the small-group market.Employers and brokers are interested in seeing more plan design options (e.g. plans compatible with an HSA) to meet the needs of more small businesses.

The Colorado Option provides standardized health insurance plans, offered by private health insurers, that aim to make health care more affordable and accessible for Coloradans. The DOI worked in partnership with health insurance companies, hospitals, health-care providers, small businesses, and consumer advocates to develop the Colorado Option benefit design. The resulting plans offer many high-value services and allow consumers and small businesses to easily compare plans across all health insurance companies to choose the plan that is right for them. These plans cover all essential health benefits required by the Affordable Care Act (ACA) and the benefit design makes it easier to know what you will pay in advance for services, such as visiting a doctor or filling a prescription. Colorado Option plans cover many services, such as primary care visits and mental health office visits, at $0 cost to the consumer.

For Plan Year 2026, the Colorado Option brought 36 health plans with increased benefits to the individual market. These plans are offered by the health insurance companies in each county they sell other individual and small group plans.

Analysis can be found here.

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