Nevada’s Public Option Begins In 2026. Here’s What It Means For Your Health Insurance

The cost of everything is going up, and that includes health care.

Kaiser Health says the average premium for employer-sponsored health care jumped nearly 7% for both individual and family coverage this year.

But health insurance has increased, on average, every year since at least 2000. So two years ago, Democrats in the Legislature passed a plan, Governor Steve Sisolak signed it, that they say will keep healthcare costs in check.

It’s called the Public Option insurance plan, and Nevada is just one of three states to have approved it.

Signed into law by Sisolak in 2021, the public health insurance option aims to lower insurance premiums by leveraging the state’s negotiating power with private companies that contract with Nevada’s Medicaid services. Using funds backed by the state, the private insurers will then offer public option plans. The coverage options will look much like the ones already offered through the state’s health insurance exchange. However, the law dictates insurers offer those “public” plans at a discounted rate, known as a premium reduction target, of up to four percent.

“This is just a plan for people who would need to buy their own coverage,” said Stacie Weeks, who oversees the state’s Medicaid program within the Nevada Department of Health and Human Services. “They don’t have, you know, employer coverage, or Medicaid or Medicare … The difference will be that the state will be contracting with [insurers] and holding them to a premium reduction target and making sure that that target is met.”

The program has also undergone changes since the Republican Governor Joe Lombardo’s administration took over the implementation process.

Lombardo has long voiced criticism of the law. He said it was “bullshit” while on the campaign trail in 2022 and then referred to it as “political theater” before he called for its repeal during his first State of the State Address.

Since then, Lombardo’s complaints have waned and earlier this month, the Department of Health and Human Services’ Medicaid Division unveiled the latest iteration of the plan, which includes a so-called “Market Stabilization Program.”

According to Weeks, the additional provision acts as insurance for insurance companies by subsidizing a portion of high-cost claims.

“I think his approach is really making sure we do it responsibly, and making sure that we can take these new savings that we’re going to get from the federal government and reinvest it back in a way that ensures the market is going to stay stable. And that we can also incentivize and reward plants for doing good in the market.”

It’s an addition that seems to have appeased both Republicans and Democrats alike.

“He’s really taken this and is adding something that he feels like turns it into something that will benefit Nevadans,” said The Nevada Independent’s Tabitha Mueller, who has covered the implementation of Senate Bill 420 since its adoption in 2021.

“The public option is still moving forward,” she adds. “He’s just adding a new portion of this by amending that waiver.”

Another reason behind the governor’s about-fact might be due to public perceptions about the law. A poll published in March by The Nevada Independent showed that more than two-thirds of the state’s voters are unfamiliar with the law, but a majority were in favor of the policy after it was explained to them.

Mueller notes it’s an indication that policymakers need to do more to educate the public about the law’s potential impact.

“There’s a need for education around this law,” Mueller said. “What’s it going to do? Who is it for? To encourage people who are uninsured who may be eligible for this plan, if the goal is to get more folks onto it, to say, ‘Hey, this is for you, and this is what it’ll do. This is how you sign up and get on it.’”

The latest figures from KFF, formerly Kaiser Health, suggest that as many as 360,000 Nevadans under the age of 65 are still uninsured. That translates to about 14% of the population.

For folks like John Packham, the Associate Dean for Statewide Initiatives for the University of Nevada, Reno Medical School, this is a step in the right direction.

“As a state, I think all options should be on the table, and this is a good one,” said Packham. “It’s good policy for the residents. I think it’s good policy for providers of health care and facilities and so forth.”

Packham, who helps analyze trends in the state’s healthcare industry, argues that programs like this will have positive effects throughout Nevada.

“They’re always going to grumble about Medicaid rates,” he added, “but [it’s] better to have insured folks hitting your doors than uninsured at the end of the day. So, I think it’s been good policy in that respect.”

There are still several hurdles to overcome before public option plans become available on the state’s insurance marketplace, including a federal review of the program in 2024.

Despite that, Stacie Weeks, head of the state’s Medicaid program, says she’s optimistic.

“Any reform is always bumpy, but I think at least we’re doing something right,” she said. “I think that the nice thing about Nevada is that it’s still moving forward and working together to try to figure out a solution to some serious health care gaps in the state.”

Ultimately, officials are hopeful the program will help reduce the costs of premiums by 15 percent within four years of its full implementation in 2026.


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