Thank you Chairman Alexander, Ranking Member Murray and members of the committee. I appreciate the opportunity to testify and share with you our bipartisan plan for stabilizing the individual health insurance market.
In 1932, Justice Louis Brandeis popularized the idea that “states are the laboratories of democracy.” He said a “state may, if its citizens choose, serve as a laboratory; and try novel social and economic experiments without risk to the rest of the country.”
In other words, states are where the rubber meets the road on the highway of the American experiment.
In Colorado, we have implemented the Affordable Care Act for seven years -- as long as I’ve been governor. For many Coloradans, it has been a success. With bipartisan support, we expanded Medicaid and created a state based marketplace, known as Connect for Health Colorado. Around 600,000 Coloradans now have care because of the ACA.
We have dealt with its complicated provisions, benefited from its good intentions, and created a culture of innovation.
But many people are angry, and have a right to be. We need to move toward a system that compensates quality, not quantity. The United States is on a lonely island among other high-income nations: we spend almost twice as much for worse care.
For the 400,000 Coloradans in the individual marketplace, many continue to struggle. Colorado’s Western slope -- which includes some of our most rural areas -- has 14 counties with only one insurer on the exchange. It is also home to some of the highest premiums in the country: A 60 year old in rural Craig, Colorado making less than $50,000 will pay over $12,000 per year on premiums alone -- around 25 percent of income.
That is simply unacceptable.
Even worse, our Division of Insurance is projecting premiums will increase by approximately 27 percent for 2018.
It’s a big problem, but our bipartisan group of Governors, including Governor Kasich, who is not here, and Governor Bullock, here today, has been working on common sense solutions to help make insurance more affordable and markets more stable for this crucial eight percent of the population.
We can do a lot at the state level, especially with congressional leadership.
Our plan asks you to explicitly fund the cost sharing reductions at least through 2019. Funding the CSRs for 2018 only will put us right back where we are now in a matter of months. It will foster uncertainty surrounding these payments, threatening to drive up premiums and force insurers out of the market.
We also need your support as we work to stabilize the market by creating a stability fund, that will help us set up reinsurance or similar programs.
We hope you will fully fund and strengthen federal risk sharing programs that will help amplify our efforts.
We’re also requesting tax incentives for insurance companies to enter counties with only one insurer on the exchange, while giving Americans who live in these counties the option to buy the same insurance that federal workers have.
Section 1332 of the ACA gives states the ability to innovate to lower costs while ensuring that certain basic guidelines are met. But existing regulations limit our ability to come up with creative solutions. That’s why we’re asking for a streamlined waiver submission and approval process, and additional flexibility in applying the budget neutrality provisions of this section.
We believe all of this can be done in a fiscally responsible way by offsetting costs.
Bringing down health insurance premiums will require us to address the underlying drivers of health care costs. That’s why we ask the federal government to fully commit to paying for value over volume and empower consumers with price and quality information.
And we can’t stabilize the market without funding health priorities that reduce health care costs like weight management, tobacco cessation, family planning and injury prevention, just to name a few.
Governors and states have proven we can innovate. We’re like startup companies -- we learn from mistakes, fix, tweak, and constantly improve. Fine is never good enough. That’s why we’re the laboratories of democracy.
In Colorado, we are stretching federal dollars and pinching pennies. We’re reducing costs and promoting a competitive market while improving care and increasing transparency.
We have a lot to be proud of, but recent federal action -- and inaction -- is undermining our efforts. It’s time for the federal government to work with us, not against us.
Without your help, It’s like climbing one of Colorado’s famous 14,000 foot mountains in winter without crampons; it can’t be done.
We need Immediate federal action and responsible reforms that preserve coverage gains and control costs.
I sincerely appreciate your efforts in calling this hearing and returning to regular order in the Senate. Lasting solutions that make health insurance more affordable and markets more stable will need support from both sides of the aisle, and leadership from states.
I look forward to answering you questions.