Colorado Considers Single-Payer Healthcare, Grapples with $1 Billion in Medical Debt
Colorado is once again revisiting the possibility of a statewide single-payer healthcare system, as residents struggle under a collective estimate of $1 billion in medical debt. The renewed push comes as national trends suggest increasing numbers of Americans may lose health insurance coverage due to planned changes to Medicaid beginning in .
The Colorado School of Public Health is currently undertaking a study, mandated by the state legislature but initially unfunded, to analyze the feasibility of a single-payer system. The Colorado Foundation for Universal Health Care stepped in to raise $740,000 to support the research, hoping to answer questions that remained unanswered when voters rejected Amendment 69 – a ballot initiative for universal healthcare – in .
“It would be simple. It would be fair,” says Marsha Thorson, a board member with the Colorado Foundation for Universal Health Care. Thorson’s perspective is informed by years of witnessing the complexities of the current system through her husband’s private medical practice. She recounts a particularly harrowing case of a young boy requiring helicopter transport to Children’s Hospital in Denver, resulting in over $1 million in medical bills for his family – a burden that, while the child survived, proved devastating.
The study aims to provide a comprehensive assessment of a single-payer system, examining its potential costs, financing mechanisms, and impact on patients, providers, and the state’s economy. Dr. Greg Tung, associate professor of Health Systems, Management & Policy at the Colorado School of Public Health, explained that researchers plan to build a new computerized model to understand the potential effects. “We’ll have a very good estimate of what would be the cost, health and financial implications,” Tung said.
Dr. Glen Mays, chair and professor of health systems, management and policy at the Colorado School of Public Health, detailed the ambitious scope of the modeling effort. Researchers intend to create a database encompassing every Colorado resident, their current insurance status, healthcare utilization patterns, and associated costs. This will allow them to simulate how costs and access to care might shift under a single-payer system.
The proposed system would integrate Medicare, Medicaid, and employer-sponsored insurance, funneling revenue through a centralized administrative structure. However, implementation would require federal waivers to redirect Medicare and Medicaid funds, and a mechanism to encourage the roughly two-thirds of Coloradans currently insured through their employers to participate. Navigating the complexities of the existing insurance landscape – with over 1,000 private companies operating in the U.S., each with its own rules and often lengthy claims processing times – is a significant challenge, according to Thorson.
The researchers are under a deadline to complete their work by the end of , but the model they develop will serve as a valuable tool for future policy discussions. Meanwhile, a separate legal battle is unfolding over a Colorado law designed to protect residents from the negative credit impacts of medical debt.
In November , the Association of Credit and Collection Professionals filed a lawsuit challenging the law that prevents medical debt from appearing on credit reports. Proponents, like Adam Fox, deputy director of the Colorado Consumer Health Initiative, argue that medical debt is often unpredictable and doesn’t accurately reflect an individual’s creditworthiness. The lawsuit contends that concealing this $1 billion in debt from lenders hinders their ability to assess risk.
Beyond the legal and political debates, the underlying issue remains the high cost of healthcare. National nonprofit Undue Medical Debt is attempting to alleviate some of the burden by purchasing debt for pennies on the dollar – $1 for every $100 owed – and abolishing it. Eva Stahl, vice president of public policy and program management for the nonprofit, emphasizes that medical debt is often unavoidable. “Medical debt is not a debt of choice,” she said. “Nobody asked to get sick or injured.”
Undue Medical Debt focuses on assisting individuals earning at or below 400% of the federal poverty level, or those with debts exceeding 5% of their income. The organization has already relieved $168 million in debt for approximately 140,000 Colorado residents. However, Stahl acknowledges that charitable efforts are not a long-term solution to the $220 billion in medical debt currently held by Americans.
“One of the most important priorities needs to be tackling the overall cost of health care,” Stahl said, while emphasizing that her organization remains neutral on specific policy solutions. As more Americans face potential loss of insurance coverage, the call for affordable and robust healthcare solutions is likely to grow louder.
