Colorado Heath Institute Analysis Misses Over $2.3 Billion in Revenue from Amendment 69
DENVER — An analysis of ColoradoCare that includes all of the binding requirements of Amendment 69 shows a surplus of $2 billion in the first year. The Colorado Health Institute (CHI) economic analysis overlooked three critical sections of Amendment 69 that ensure its economic viability.
“Amendment 69 requires the state to maintain its current funding of Medicaid, including the state match for Medicaid expansion and CHP+,” said Ivan Miller, Executive Director of the ColoradoCareYES campaign. “The Federal government matches all state funding sources for Medicaid. In the case of the expansion, the Federal government provides a 9:1 match.”
CHI failed to include the impact of Amendment 69’s requirement that the state legislature revise statute and ensure the preservation of Medicaid funds. This exclusion alone accounts for a 37% reduction in anticipated federal funding and is based on unwarranted speculation that flies in the face of precedent.
“What difference does this make?” Miller asked. “When the funding required by Amendment 69 is included in a complete analysis, and CHI’s own rules and their other assumptions are maintained, ColoradoCare has a $2 billion surplus in the first year. In 10 years, ColoradoCare’s spending would be $2.7 billion less than the current corporate insurance industry’s system, which leaves 350,000 Coloradans uninsured and another 700,000 underinsured and at high risk for medical bankruptcy.”
Even the most critical economists project a minimum 0.5% reduction in the rate of health expenditure growth under a system like ColoradoCare. At that rate, the worst case scenario for ColoradoCare would mean a projected budget deficit of $700 million after ten years without any increase in the rate of the 3.33% payroll deduction. In contrast, the current system is projected to see 5.8% per year rate increases in order to keep pace with rising costs while protecting corporate profits.
Perhaps most significantly, ColoradoCare is designed to utilize federal waivers and has safeguards built in to Amendment 69 to protect it from the budget deficits that would result without the federal funding. Coloradans can take comfort in remembering that if the Federal waivers are not granted during the build-up to implementation, the language of the Amendment instructs ColoradoCare to “shut down operations and restore unused funds” to the taxpayers.
CHI has neglected to revise their report to reflect the binding language of Amendment 69. Without this revision, their analysis is incomplete and inaccurate in its reliance on groundless speculation. More comprehensive, precedent-based analyses from economists Dr. Gerald Friedman (Univeristy of Massachusetts), Dr. Anders Fremstad (Colorado State University), and Dr. Jeff Helton (Metro State University) concur on ColoradoCare’s dramatic savings compared to the current system and validate Amendment 69’s fiscally sound approach projected over its first 10 years of operation.
For video of the August 30, 2016 Press Conference, please click here.
For more information on Amendment 69, please visit www.ColoradoCare.org.
For an explanation of the relevant, overlooked language in the Amendment, click here.
For a graph of CHI’s corrected 10-year projections, click here.
For Dr. Jeff Helton’s economic analysis, click here.