Colorado calls on federal government to support its health policy initiatives

Colorado leaders are counting on the federal government to pave the way for the state’s bold policy initiatives. In an in-depth conversation at the 2021 State of Reform Federal Health Policy Conference, Kim Bimestefer, the executive director of the Colorado Department of Health Care Policy and Financing (HCPF), and Michael Conway, the state’s insurance commissioner, detailed ways in which the federal government can expedite Colorado’s efforts.

Bimestefer said she is excited for Xavier Becerra to assume leadership of the U.S. Department of Health and Human Services (HHS). She explained he has a history of holding the health care industry accountable, and that having him at the helm of HHS will help states like Colorado work with the industry to lower costs and improve care.

 

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“He’s done some wonderful things in California. His protection of the ACA [Affordable Care Act] was fantastic. But he’s held the industry accountable, and we need more of that. He held the pharmaceutical industry accountable for opioids, he held the hospital industry accountable with his Sutter settlement. So if we saw more of those best practices for industries being held accountable, and a focus on [the consumer] and affordability, [that] would be fabulous.”

With regards to Colorado’s ongoing efforts to increase the affordability of prescription drugs, Bimestefer has several requests of the Biden Administration. As the bill to allow the state to import prescription drugs from countries other than Canada progresses through the Colorado Legislature, Bimestefer said the federal government needs to allow biologics to be imported into the U.S.

While the country is currently permitted to import nonbiologics, vital biologic prescription drugs like insulin and Humira are prohibited from being imported. By allowing for the importation of these drugs — which, according to Bimestefer, account for a significant portion of the country’s total spend on prescription drugs — Coloradans with diabetes and other severe conditions will have access to more affordable medications.

Another way the federal government can help Colorado decrease the prices of its prescription drugs is by changing the country’s rules surrounding patent protections. Currently, prescription drug manufacturers are utilizing patent rules to prevent competition in their markets, thus keeping costs for drugs like Humira high.

While Bimestefer said patent reform is a priority for the Biden Administration, she said an alternative solution is the HCPF-supported legislative effort to establish a prescription drug affordability board.

“Humira has 23 years of patent protections — more than 100 different filings to keep the generics out. Other countries don’t tolerate that. So if we can’t change the federal gridlock to get patent protections, and we can’t change to the price set for a new drug, or we can’t get a patent protection change, what we can do is put an affordability board in our own state.”

Conway said the federal government needs to change the rules pertaining to granting 1332 waivers. Since proposed insurance programs need to show a deficit neutrality, certain programs aren’t given the waiver, even if they will be beneficial in the future. He added that the neutrality is evaluated on a year-over-year basis, which is too short term.

Instead, he proposes that the deficit impact of proposed programs be evaluated over longer time periods — like a 5 or ten-year period — so that Colorado can pursue promising programs that might take longer to produce cost savings. This would be particularly beneficial for the Colorado Public option, Conway said.

“We really need that deficit neutrality to be more flexible than a year-over-year approach.”

Conway praised the aid the American Rescue Plan Act (ARPA) brought to Colorado, and said he hopes the federal government will continue to provide this assistance when the plan expires in 2023. 

In particular, he said ARPA’s new subsidy for individuals whose premiums exceed 8.5% of their income is a “game changer.” He is concerned about how the potential loss of these subsidies would impact Coloradans currently receiving the new support.

“It’s going to be really, really difficult if we find ourselves in a position, in 2023, [where] those subsidies are taken away from folks. I think it’s going to be extremely difficult, and i don’t think the states can replace them by themselves.”