Actuarial reviews of health benefit reforms in Colorado saw slow start during first year


Boram Kim


Senate Bill 40, which passed the Colorado Legislature last year, requires the Division of Insurance (DOI) to conduct actuarial reviews of legislation imposing a new health benefit coverage on insurance plans. 


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The statute allows up to six reviews to be performed per legislative session, two each on legislation from the majority party in both the House and Senate, and one each on legislation from the minority party in both chambers. 

DOI only performed one such review this session, which evaluated four benefits (vasectomies, medication abortion, over-the-counter oral contraceptives, and emergency contraception) proposed in Senate Bill 189, the results of which were published in February. SB 189 became law last month.

The review found that full coverage of those benefits without cost-sharing would have minimal impacts on the average monthly premium (-0.01%) and annual premium (0.03%) per member across all health insurance markets. 

DOI did not perform any additional reviews of bills introduced during the 2023 General Assembly

However, DOI established that lawmakers can submit review requests for legislation introduced during this year’s session up to Sept. 1st in its August draft bulletin last year, published less than a month prior to the cutoff. 

Lawmakers attributed that “tight deadline” to a failure to submit requests for reviews in time for this year’s session. 

Rep. Matt Soper (R – Delta), told State of Reform that as a member of the House Health and Insurance Committee, he did not see the review performed on any measures presented before the committee this session, with the exception of SB 189. 

“Every time I raised [the issue of conducting an actuarial review] in committee, the answer back was [that] the bill drafting deadlines for the review were so tight, there was no way to get it done to comply,” Soper said. “Whether that’s true or not, I don’t know. What I can tell you is next session that excuse won’t be on the table because it’s already the law.

Any healthcare bill that’s going to possibly increase health insurance mandates and health insurance costs or premiums will have to have that actuarial review done. And [the review] is limited to the number that can be done per caucus, too.”

DOI told State of Reform that it had not received any complaints about the process leading up to and during the legislative session since it was proposed last year. Lawmakers will have until Sept. 1st of this year to submit their cost analysis requests to DOI for the next cycle of proposed health benefit legislation. The selection of bills to be reviewed will be made by Sep. 30th and remain confidential until the formal introduction of the legislative proposals or after the end of the 2024 session.

The Colorado Association of Health Plans (CAHP) says this session witnessed the passage of numerous bills that expand coverage for health services and pharmaceuticals off-formulary, and run counter to the stated goals of lowering healthcare costs. 

“Despite the importance of [actuarial] information, legislators have rarely, if ever, utilized this voluntary process,” said Saskia Young, executive director of CAHP. “CAHP regularly communicates to policymakers that increasing mandates on health insurers increases costs in direct contradiction to efforts to save people money on healthcare. From 2011-2019, we estimate a premium increase of 5% to 7% from these types of bills alone.

As healthcare insurers, we respectfully request that the members of the General Assembly recognize the impact of such legislation on their goal—which CAHP shares—to make healthcare more affordable.”

Two pieces of legislation passed this session, SBs 189 and 288, that require the DOI to conduct reviews outside of the formal SB 40 process. SB 189 mandates a study on the predicted costs and health impacts of removing step therapy and prior authorization for HIV treatment drugs, the results of which will be submitted in a report to the general assembly by October 2026.

Speaking to State of Reform after the session, Sen. Rhonda Fields (D – Aurora) affirmed a study will be conducted this year to evaluate SB 288’s call to expand coverage of doula services to private health plans next session. 

Fields sponsored and helped pass SB 288, which requires the state to promote the utilization and expansion of doula services under Medicaid. While Medicaid benefit mandate changes are not subject to actuarial reviews, SB 288 requires an actuary study of doula services as a new benefit under health plans in the state. 

“We’re also looking at trying to make sure that [Medicaid] option from doulas is also available for our private insurance providers as well,” Fields said. “So [for] our state-level insurance and private insurance, we’re doing an actuary study, and then [we will] come through next year to make sure that we anchor that piece so [that] the doula coverage is significant, especially for moms who are dealing with prenatal [and] postnatal [issues] and need that level of support.”

Sen. Jim Smallwood (R – Castle Rock) who sponsored and helped pass the measure to establish the actuarial review process, told State of Reform that he was pleased to see the sponsors of SB 288 call for a cost-benefit analysis. 

“When the results come back from this study of doulas, [sponsors] would like an actuary to put together a report explaining the benefits and the costs to the taxpayers in the state of Colorado,” Smallwood said. “Which was fantastic to hear because in the seven years that I’ve been here in the state Senate, we’ve gone from nobody even appearing to know what an actuary was or what they did—certainly not emphasizing the importance of actuarial reviews—to where now it’s almost commonplace.

If somebody’s talking health policy, the question comes up, ‘Well, what did you see in the actuarial review? What did the actuarial review produce?’ So to me, it’s mission accomplished because those conversations are absolutely happening in the general assembly in Colorado, which is great.”

Smallwood said with the governor’s support for the process, he anticipates more reviews will be attached to legislation come next session.