Senate Bill 200 Begins The Process Of Creating Colorado Exchange

Colorado House Majority Leader Amy Stephens appears to be covering all of her bases when it comes to health care reform.  In addition to c0-sponsoring a bill that would allow Colorado to opt out of federal health care reform, she’s also a co-sponsor on a new bipartisan bill that was introduced this week to begin the process of setting up Colorado’s health insurance exchange.

Senate Bill 200 (the Colorado Health Benefit Exchange Act), co-sponsored by Senator Betty Boyd (D – Lakewood) gets the ball rolling on the health insurance exchange that the state will have to have in place by 2014.  Specifically, the bill would create a “nonprofit unincorporated public entity known as the Health Benefit Exchange”. It includes guidelines for the appointment of a 12-member board of directors (9 of whom will be voting members) who will oversee the exchange, and lays out their responsibilities.

The bill begins by acknowledging that there are several lawsuits challenging the constitutionality of the PPACA at the moment, but that the lawmakers feel it is in the state’s best interest to proceed with legislation to begin the process of creating a health insurance exchange at the state level (the other alternative that the PPACA allows is for states to participate in a national exchange run by HHS).  The bill notes that its intent is to “increase access, affordability, and choice for individual and small employers purchasing health insurance in Colorado.

SB 200 is clear in noting that the Colorado Division of Insurance will still be in charge of the regulation of the health insurance market (see page 4 of the text):

“The exchange shall not duplicate or replace the functions of the Division of Insurance established in section 10-1-103, including rate approval, except as directed by the federal act.  The exchange shall foster a competitive marketplace for insurance and shall not solicit bids or engage in the active purchasing of insurance.  All carriers authorized to conduct business in this state may be eligible to participate in the exchange.”

The nine voting members of the exchange board of directors have to be appointed by July 1 of this year.  Five will be appointed by Governor Hickenlooper, and one each will be appointed by the President of the Senate (Brandon Shaffer – D), the Senate Minority Leader (Mike Kopp – R), the Speaker of the House (Frank McNulty – R) and the House Minority Leader (Sal Pace – D).  The non-voting members of the board will be the executive director of the Department of Healthcare Policy and Financing, the Commissioner of Insurance, and the director of the Office of Economic Development and International Trade (or someone they designate).  Board members will not be paid for their services, but may receive per diem and travel reimbursement for expenses incurred during their course of their duties as board members.  Funding for any expenses will come from grant money.  Each year by January 15, the Board will have to provide a written report to the governor and the legislature detailing the progress of the Exchange implementation process.

In addition to creating the Board of Directors, SB 200 also establishes aLegislative Health Benefit Exchange Implementation Review Committee“, which will convene by August 1, 2011.  This Committee of lawmakers will be responsible for “guiding implementation of an exchange in Colorado, making recommendations to the General Assembly, and ensuring that the interests of Coloradans are protected and furthered.”

Colorado has been taking an active role in shaping health care reform on a state level for some time now, and it’s no surprise that our lawmakers are taking steps to set up a state exchange rather than relying on one created by HHS at the federal level.

About Louise Norris

Louise Norris has been writing about health insurance and healthcare reform since 2006. In addition to the Colorado Health Insurance Insider, she also writes for,, Verywell, Spark by ADP, and Boost by ADP, and Gusto. Follow on twitter and facebook.


  1. Rick Ninneman says

    I am not sure how a Government run, free market system will save money? Anti selection, mandated benefits and lack of focus on cost and quality will doom this program just as it has tanked in MA.

    Whether it is a Federal proposal or one at the State level, these measures do nothing to address the true “COST” of healthcare which are over utilization and provider fees.

    The tenets of Health Care consumerism are Cost, Quality and Access. I have not seen any approved or proposed legilation that deals with anything but access. The 3 are completely inter dependent.

  2. Rick,
    I agree. Over the last couple years, I’ve been disheartened a bit by the reform process as it became more and more about health insurance reform rather than health care reform. There’s definitely an element of putting the cart before the horse when everyone is focusing on cutting health insurance premiums without looking at what is actually driving those premiums.

    As I understand it, the exchanges are meant to expand access to health insurance, make the process of getting health insurance more user-friendly, and foster competition among carriers. But you’re right – they don’t address the cost of healthcare and the over-utilization of care, which are the ultimate driving factors behind the cost of health insurance.

  3. Rick and Louise make excellent points.
    The only way to drive down costs is to drive down utilization, at least utilization that is covered by insurance.
    In my patent-pending application, we encourage people with zero deductibles on preventive care, etc. to utilize the services, if they desire, but to pay out of pocket.
    While their deductible is zero, with my primary plan design, they are building coverage pretty fast.
    In 2-4 years, depending on contributions, they can build $25,000-$50,000 of coverage, which translates to a $25,000-$50,0000 deductible, even though the plan has a zero deductible.
    This plan will be first marketed to teachers in Colorado and other states. Each month the teacher saves more money in health insurance premiums, this savings goes directly to their retirement plans. So, every month, they are seeing a positive difference for non utilization of insurance covered expenses.
    Don Levit

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