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May 10, 2023

Signed! Legislation to Reduce Insurance Premiums, Costs of Prescription Drugs

AURORA, CO - Today, Governor Jared Polis signed into law two pieces of legislation to reduce insurance premiums and the cost of prescription drugs.

HB23-1224, sponsored by Senator Dylan Roberts, D-Avon, and Reps. Iman Jodeh, D-Aurora, and Kyle Brown, D-Louisville, lowers insurance premiums and makes it easier for consumers to shop for high value standardized health plans that work for them and their families.

The bill strengthens the Department of Insurance’s (DOI) ability to hold carriers accountable for the premium rate reduction requirements on Colorado Option Standardized Plans by granting the DOI the authority to:

  • Limit factors such as as excessive profit and administrative expenses;

  • Structure the public hearing process efficiently while ensuring all parties have the opportunity to participate;

  • Help consumers easily find and compare plans that could lower their out-of-pocket costs.

“Too many Coloradans are forced to choose between preventative health care services and paying the bills,” Jodeh said. “By reducing premium rates for Colorado Option plans and strengthening cost-saving requirements over Pharmacy Benefit Managers, our new laws will protect Colorado patients, pharmacies, and businesses from unfair practices while saving them money on health care.”

“Every Coloradan, no matter where they live, deserves to have access to the life-saving health care they need,” said Roberts. “Colorado has led the way in lowering costs of health care by creating the Colorado Option. This bill builds on the first year of success of that plan and makes changes that will ensure that next year and in the years to come, even more Coloradans, particularly in the rural communities like those I represent, will be able to access more affordable and higher quality insurance options.”

“The Colorado Option has been very successful, creating $14 million in savings for Colorado patients on health care plans, in its first year in the market,” Brown said. “With this new law, we’re making improvements to the Colorado Option to save Coloradans even more money on health care. I’m proud of the work that we’ve done to cut down on health care costs and pass savings down to Colorado consumers.”

The second bill, HB23-1227, ensures that Pharmacy Benefit Managers (PBM) follow through on critical cost savings reforms that the legislature has passed in recent years to save consumers money. Sponsored by Senators Sonya Jaquez Lewis, D-Longmont, and Perry Will, R-New Castle, and Reps. David Ortiz, D-Littleton, and Jodeh, the bill provides the DOI with more direct oversight over PBMs by requiring them to register and specifying that the DOI has the ability to enforce those reforms.

“As a pharmacist I know firsthand how critical it is for Coloradans to be able to afford their prescription drugs, but too many of our families are still getting squeezed by high costs of medication,” said Jaquez Lewis. “HB1227 is part of a multi-year effort to keep Colorado prescription drug prices affordable. I’m thrilled to see this critical bill to save families even more money on life-saving medications signed into law.”

“Addressing the cost of prescription drugs is a critical part of creating an equitable and accessible health care system,” said Ortiz. “This new law will give us the tools to hold Pharmacy Benefit Managers to the cost-saving measures that Colorado Democrats have passed to improve access to affordable, quality health care for all.”

The bipartisan bill grants the Insurance Commissioner the power to investigate and impose penalties on PBMs for failing to comply with consumer protections such as charging pharmacies fees to adjudicate claims, clawing back money from pharmacies inappropriately, and discriminating against independent pharmacies versus PBM-affiliated pharmacies.

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