Colorado Option

Page Updated: Oct. 10, 2024

CHA Advocacy Principle: All rates must ensure payment adequacy and efficiency to provide care, and any rate-setting determination should include a fair, transparent process that provides due consideration to cost-drivers, such as pharmaceutical and labor costs, and recognizes good-faith efforts to negotiate.

What Has Been Completed:

Origin: House Bill (HB) 21-1232 established the Standardized Health Benefit Plan Colorado Option.

Background: The regulatory process began to operationalize the Colorado Option in July 2021, and included the development of the standardized plan, cultural competency requirements, the federal 1332 waiver to provide pass-through funding, and the rate-setting process. 2023 would have been the first year rate hearings were held; however, all of the scheduled rate hearings were canceled due to hospitals and insurers coming to agreements prior to when the hearings would have occurred.

During the 2023 legislative session, the DOI finalized legislative updates to the Colorado Option through HB 23-1224. This legislation updates the preference process for plan selection, grant the Commissioner 120 days to review the rate filings, increase the Commissioner’s discretion to bring a provider to a hearing once identified by a carrier, make all appeals subject only to the court of appeals. 

In fall 2023, the DOI updated regulations 4-2-91 and 4-2-92, which outline the public hearing process and hospital/provider reimbursement rate setting methodology. CHA submitted two comment letters (see resources) and testified at the rulemaking hearing. Finalized regulation 4-2-91 can be found here and finalized regulation 4-2-92 can be found here.

Resources: 

• • CHA Resource Guide for Carrier and DOI Complaints
  • CHA Comment Letter on Proposed Bulletin B-4.127 (2.12.24)
  • CHA Comment Letter on Proposed Rule Changes (11.27.23)
  • CHA Comment Letter on Proposed Rule Changes (10.3.23)
  • CHA Comment Letter on DOI Medical Inflation Definition,
  • Preliminary Rate Filings for Plan Year 2024
  • May 2023 CHA Comment Letter for Public Hearings
  • CHA Memo: Potential Contract Terms to Promote Compliance with the Colorado Option
  • DOI Slide Deck for CHA Regulatory Update on Rate Hearings
  • Recording Information for CHA’s February Regulatory Update on Colorado Option (passcode: mJ5#0GgP)
  • Division of Insurance Colorado Option Webpage
  • DOI List of Individual Medical Plans by Region/County
  • DOI List of Small Group Medical Plans by Region/County
  • Colorado Option Timeline
  • Nov. 18, 2022 CHA Rates/Hearing Comment Letter
  • Agency Contact Information: [email protected]  
  • CHA Executive Brief on Rate-Setting

CHA Staff Contact: Megan Axelrod, CHA senior director, regulatory policy and federal affairs, megan.[email protected].