Is Universal Health Care Coming to Colorado?

State ballot measure would have large impact on Colorado employers

LIKE SAVE PRINT
Reuse Permissions


[Editor's Note: Coloradans rejected this measure, which would have created a single-payer health care system for residents of the state.]

On Nov. 8, Coloradans will decide the fate of a proposed state constitutional amendment to provide universal health care to residents.

Amendment 69 would establish ColoradoCare, an entity that would administer a health care system for all people whose primary residence is in the state.

"It's a laudable goal for everyone to have health insurance and control over the associated costs, but it may be too overwhelming for Colorado," said Kirsten Stewart, an attorney with Sherman & Howard in Denver.

Payroll Tax

The amendment calls for employers and workers to finance the estimated $25 billion annual cost of the program through a 10 percent payroll tax.

Employers would pay 6.67 percent and employees would pay 3.33 percent up to a certain cap. With some exceptions, nonpayroll earnings, such as pension payments and rental property income, would also be taxed at 10 percent.

This would be in addition to the 4.63 percent state income tax already levied, Stewart noted.

Supporters of the amendment say many Coloradans would save money under the program because they wouldn't be charged premiums, deductibles or co-pays for primary and preventive care.

The ColoradoCare Yes campaign said the measure would cut total health care spending in the state by $4.5 billion and would result in savings for many employers, which already spend an average of 13.5 percent of payroll on employee health care.

However, opponents think the tax increase is too high. The amount is nearly double the state's $27 billion budget. They are also concerned about the impact on small businesses and multistate employers.

"Employers would be able to get rid of their insurance for folks in Colorado, but it would be pretty difficult for multistate employers to administer," Stewart said.

[SHRM members-only Toolkit: Introduction to the Human Resources Discipline of Employee Benefits]

Moreover, there's no guarantee that the 10 percent payroll tax will cover all the costs of the system, she said: "There is some speculation that if there isn't enough funding, the tax will go up even more.

"There's a lot of economic growth in Colorado from employers coming into the state," Stewart added. "But with this uncertainty, it may make employers decide not to move to Colorado or make health care providers decide to move out."

Strong Opposition

The amendment has been met with bipartisan opposition, according to Cole Wist, an attorney with Ogletree Deakins in Denver and a Republican member of the Colorado House of Representatives.

The opposition is pretty uniform on the Republican side, he said, but some Democrats have opposed the amendment as well.

The liberal advocacy group ProgressNow Colorado announced its opposition to the amendment in August. Although the group generally supports the push for single-payer health care, it said there are unintended financial and other consequences attached to Amendment 69.

"When one of the state's leading health care research organizations tells us this is a plan that doesn't work fiscally, we have to take that seriously," said ProgressNow Executive Director Ian Silverii in a press statement.

As of Oct. 18, the lead campaign supporting the initiative had raised about $837,000, while opponents had raised over $4 million, according to Ballotpedia, a nonpartisan online voting resource.

The measure isn't likely to pass, Wist said, but it gives an indication of how health care discussions will take shape in the future.

"Employers should be aware that political issues like this can affect the workplace," he said. "These issues can impact the business's bottom line."

Was this article useful? SHRM offers thousands of tools, templates and other exclusive member benefits, including compliance updates, sample policies, HR expert advice, education discounts, a growing online member community and much more. Join/Renew Now and let SHRM help you work smarter.

LIKE SAVE PRINT
Reuse Permissions

SEMINARS

HR Education in a City Near You

Find a Seminar

Job Finder

Find an HR Job Near You

SPONSOR OFFERS

Find the Right Vendor for Your HR Needs

SHRM’s HR Vendor Directory contains over 3,200 companies

Search & Connect