HB 25-1297
Fiscal Note
Legislative Council Staff
Nonpartisan Services for Colorado’s Legislature
HB 25-1297: HEALTH INSURANCE AFFORDABILITY ENTERPRISE UPDATE
Prime Sponsors:
Rep. Brown; Gilchrist
Sen. Jodeh
Published for: House Health & Human Services
Drafting number: LLS 25-0887
Fiscal Analyst:
Kristine McLaughlin, 303-866-4776
kristine.mclaughlin@coleg.gov
Version: Initial Fiscal Note
Date: March 14, 2025
Fiscal note status: The fiscal note reflects the introduced bill.
Summary Information
Overview. The bill raises the fee cap and changes the funding allocation of the Health Insurance
Affordability Enterprise.
Types of impacts. The bill is projected to affect the following areas on an ongoing basis:
State Revenue State Expenditures
Appropriations. No appropriation is required. All expenditures are paid from the Health Insurance
Affordability Cash Fund, which is continuously appropriated.
Table 1
State Fiscal Impacts
Type of Impact
Budget Year
FY 2025-26
Out Year
FY 2026-27
Out Year
FY 2027-28
State Revenue (Cash Funds) $0 $0 $67,823,157
State Expenditures (Cash Funds) $0 $0 $67,823,157
Transferred Funds $0 $0 $0
Change in TABOR Refunds $0 $0 $0
Change in State FTE 0.0 FTE 0.0 FTE 0.0 FTE Page 2
March 14, 2025 HB 25-1297
Summary of Legislation
Senate Bill 20-215 created the Health Insurance Affordability Enterprise (the enterprise) in the
Department of Regulatory Agencies (DORA). The enterprise assesses a fee on health insurance
carriers, which is currently caped at 1.15 percent of premiums for nonprofit carriers and
2.1 percent for for-profit carriers. As shown in Table 2, fund are allocated to several initiative to
reduce individual insurance market premiums, including:
the reinsurance program which covers a portion of claims for high cost individuals;
state insurance subsides for Coloradans with incomes below 300 percent of the federal
poverty line who are not eligible for federal tax credits or state funded insurance; and
payments to carriers to lower the cost of purchasing insurance through the Health Insurance
Exchange for individuals who meet federal requirements, including having an income
between 133 and 400 percent of the federal poverty line.
The bill increases the carrier fee cap by up to 1.0 percent and changes the funding allocations as
shown in Table 2. Additionally, the bill allows the enterprise to accept gifts, grants, and
donations.
Table 2
Funding Allocation Proposed Changes
HIAE Costs Current Law Under HB 25-1297
Reinsurance Program Lesser of 73 percent or $90 million 40 percent
State Subsidies $18 million plus any remaining 40 percent
Health Insurance Exchange Up to 10 percent 10 percent
Emerging Initiatives Not available 6.5 percent
Administrative 3 percent 3.5 percent
State Revenue
Revenue will increase to the Health Insurance Affordability Enterprise in DORA if, as allowed by
the bill, the enterprise raises fees on insurance premiums by 1.0 percent starting in calendar year
2026. There is an 18-month lag between when fees are increased and revenue is accrued,
resulting in the potential increase in revenue starting in FY 2027-28 as shown in Table 3. This
revenue is not subject to TABOR. Page 3
March 14, 2025 HB 25-1297
Table 3
Annual Change in Insurance Premium Fee Revenue
Starting in FY 2027-28
Fee Premiums Subject to Fee Fee Increase Revenue Increase
Insurance Premium Fee - For-Profit $4,355,338,320 1.0% $43,553,383
Insurance Premium Fee - Nonprofit $2,426,977,389 1.0% $24,269,774
Total FY 2027-28 and Future Years $6,782,315,709 1.0% $67,823,157
State Expenditures
Expenditures in the Health Insurance Affordability Enterprise in DORA will increase to the extent
that revenue increases as shown above in Table 3.
Additionally, the bill changes the funding allocation for programs within the enterprise as shown
in Table 2 above. Table 4 shows how the reallocation in revenue will affect enterprise
expenditures based on projected FY 2025-26 revenue. The same relative change is expected in
future years even as total program expenditures increase.
Table 4
Funding Allocation Proposed Changes, Expenditure Impact in FY 2025-26
HIAE Costs Current Law Under HB 25-1297 Net Change
Reinsurance Program $87,894,186 $48,161,198 -$39,732,988
State Subsidies $18,000,000 $48,161,198 $30,161,198
Health Insurance Exchange $10,896,719 $12,040,299 $1,143,580
Emerging Initiatives $0 $7,826,195 $7,826,195
Administrative $3,612,090 $4,214,104 $602,014
Effective Date
The bill takes effect upon signature of the Governor, or upon becoming law without his
signature.
Page 4
March 14, 2025 HB 25-1297
State and Local Government Contacts
Regulatory Agencies
The revenue and expenditure impacts in this fiscal note represent changes from current law under the bill for each
fiscal year. For additional information about fiscal notes, please visit the General Assembly website.