December 08, 2020
On December 3, 2020, the Division of Insurance announced that it adopted Regulation 4-2-72, which establishes standards for carriers that issue health plans to employers that cover over 10,000 lives. The division intends to use these standards to make health insurance more affordable by setting targets for carriers to increase utilization of primary care by the proportion of total medical expenditures in Colorado allocated to primary care by one percentage point annually in calendar years 2022 and 2023, compared to each carrier’s baseline primary care spending (the baseline is calculated as the proportion of total medical expenditures allocated to primary care for the calendar year 2021). The new regulations also require that carriers target 25% of the expenditure to be made through prospective payments by the end of calendar year 2023.
In addition, the regulations require that carriers target 50% of a carrier’s total medical expenditures in Colorado to be made through alternative payment models (APMs) by the end of calendar year 2022. The regulations define APMs to mean “health care payment methods that use financial incentives to promote greater value – including higher quality care at lower costs – for patients, purchasers, and providers. Unlike traditional fee for service payments, APMs utilize cost and quality control strategies that benefit consumers by increasing the value of care delivered and, ultimately, the affordability of care.” The regulations mandate that carriers target 10% of the expenditure to occur through prospective payments by the end of calendar year 2022.
Employers with plans issued by state-regulated carriers should be aware of these new standards and requirements.
Regulation 4-2-72 »