HB25-1297: Health Insurance Affordability and Funding Adjustments
Expansion of Qualified Individual Definition (C.R.S. 10-16-1203)
Expands eligibility for state-subsidized health insurance to individuals qualifying under Medicaid Expansion (C.R.S. 25.5-5-201(6)) or Children’s Basic Health Plan (C.R.S. 25.5-8-109(7)).
Health Insurance Affordability Fee Adjustments (C.R.S. 10-16-1205)
Starting in 2026, the Insurance Commissioner may increase the Health Insurance Affordability Fee by up to 1%.
Objectives for Increasing Fees:
Maintain 20% premium reductions under the reinsurance program.
Provide subsidies for individuals up to 250% of the federal poverty level.
Cover Hyde Amendment compliance costs.
Support health coverage expansion efforts.
Fee Allocation Adjustments:
40% to state-subsidized health plans for qualified individuals.
40% to the reinsurance program.
10% to reducing individual health plan costs on the exchange.
3.5% for administrative costs.
6.5% for additional affordability initiatives or reserves.
Use of Additional Funds (C.R.S. 10-16-1206 & 10-16-1207)
Allows the state to accept gifts, grants, and donations for enterprise operations, reserves, and sustainability.
Encourages localized funding allocation, ensuring donor-directed funds benefit specific localities.
Summary
Beginning in 2026, the bill authorizes an increase to the health
insurance affordability fee assessed and collected from insurance carriers (carriers) by up to one percentage point to implement and administer the health insurance affordability enterprise (HIAE). The bill includes objectives for the commissioner of insurance (commissioner) to consider in determining whether to increase the HIAE fee, including, in part, maintaining HIAE programs to achieve a premium reduction in the reinsurance program and to provide subsidies for individuals with low income who purchase insurance on the Colorado health benefit exchange. The commissioner shall notify carriers of the amount of the HIAE fee for the upcoming calendar year.
The bill changes the allocation of the HIAE fee assessed for 2026,
dedicating up to 40% each to state-subsidized individual health coverage plans purchased by qualified individuals and to the reinsurance program cash fund, with the remaining revenue allocated for other purposes specified in the bill, including new and emerging health insurance affordability initiatives.
The bill authorizes the enterprise to seek, accept, and expend gifts,
grants, or donations for the purposes of the HIAE.
