DENVER — Gov. Jared Polis warned Tuesday that an estimated 110,000 Coloradans would lose health insurance coverage next year and others could see their premiums more than double if President Donald Trump’s budget bill becomes law and enhanced subsidies to purchase insurance expire.

Polis, a Democrat, sent the warning in a letter to Colorado’s congressional delegation because the “One Big Beautiful Bill Act,” a priority for Trump and the Republican-led Congress, doesn’t extend higher tax credits to cover the cost of insurance on the individual market. Losing the credits would have a ripple effect across Colorado’s health insurance marketplace and the state reinsurance program — one of Polis’ signature achievements during his first term as governor.

Congress raised the amount of the credits and extended them to higher earners, who normally wouldn’t qualify, during the pandemic. If legislators don’t act, the credits return to pre-pandemic levels this year.

Paradoxically, a provision in the bill that reduces the monthly cost for silver plans sold on the state marketplace also would raise insurance costs in Colorado, though not by as much as the changes in tax credits.

The “metal” levels of plans sold on the exchange represent trade-offs between monthly premiums and out-of-pocket expenses. Silver plans are in the middle, costing less on a monthly basis than gold plans, but providing more protection from out-of-pocket costs if someone gets sick than bronze plans do. According to Connect for Health Colorado, which runs the state’s marketplace, silver plans are the most popular option.

Colorado faces a double hit because of its reinsurance program, Insurance Commissioner Michael Conway said. Basically, reinsurance acts as a backstop so insurance companies don’t have to pay as much when their customers need expensive care. Since their expenses are smaller, they charge lower monthly premiums. That, in turn, reduces how much the federal government has to pay out in tax credits to help people afford the monthly cost of insurance. Instead of keeping that money, the federal government agreed to allow the state to use it to further lower insurance costs.

When the enhanced credits expire, the federal government will be on the hook for less money, meaning the pot of savings Colorado receives will be smaller, Conway said. The credits are pegged to the cost of silver plans, so lowering the monthly premiums for those plans also will reduce the savings the state can reinvest, he said.

“It’s unprecedented because of everything hitting all at once,” Conway said. “It’s going to feel like a tidal wave is hitting people.”

The Department of Insurance estimates that the effects of the changes in silver plan prices alone could raise premiums for people buying health insurance on the marketplace across the Front Range by an average of $1,500 annually for a family of four and by $4,300 for a family of four in rural Colorado, or about 7% and 16%, respectively.

If Congress also lets the enhanced subsidies expire, premiums could more than double, on average, for households that receive those subsidies. In the most recent year, about four out of five customers on the individual market received some level of subsidy.

“When paired with the disastrous impacts of the House-passed reconciliation bill, the federal government is looking to devastate Colorado’s health insurance market, patients and the health care system as a whole,” Polis wrote in his letter to the delegation. “The cost of health care and insurance is too high and this bill will increase costs on hardworking Coloradans.”

The reinsurance program was created through a bipartisan 2019 law. The state already funds the reinsurance pool with about $90 million, according to the Colorado Department of Insurance. This year, the federal government bolstered the fund with another $339 million in “passthrough” money that reflects overall savings on insurance claims.

The reconciliation bill threatens to cut that money by more than $200 million if Congress does not reinstitute the expiring tax credits, according to Polis. The elimination of the tax credits would also directly hurt Coloradans, Polis wrote, and create a “subsidy cliff” where families suddenly lose all tax credits once they hit a certain income threshold, versus a tapered approach.

“On top of the destructive proposed cuts to Medicaid, which will throw hundreds of thousands of Coloradans off of their health care, failure of the Republican controlled Congress to extend these ACA tax credits, which have saved Colorado families hundreds of millions in premiums, will throw even more people off of health insurance who rely on reinsurance and marketplace coverage to save money,” Polis said in a statement.

The reconciliation bill passed the House by a one-vote margin at the end of May. All of Colorado’s House Democrats voted against it, and all of its Republicans voted yes. It is now in the Senate. Any changes will need to go back to the House for reconsideration.

Rep. Gabe Evans, a Fort Lupton Republican who represents one of the most competitive Congressional districts in the country, has defended the bill as protecting he long-term viability of Medicaid. He has accused Democrats of “blatant fearmongering” around the bill.

U.S. Rep. Lauren Boebert, a Windsor Republican, said the bill overall “strengthens Medicaid to focus on American citizens who truly need help.” She highlighted proposed changes to Medicaid to prevent coverage for undocumented immigrants and gender gender-affirming surgeries and to institute work requirements.

“There’s work to be done in the coming months to further codify President Trump’s agenda and executive orders, but the One Big Beautiful Bill puts us on a pathway to American greatness,” Boebert said of the overall bill.

As the bill stands now, some changes would take effect before the next open enrollment season starts in November, Conway said. The short timeline would be a challenge for insurance companies setting their rates and regulators trying to review them, he said.

“We have no idea how the hell we’re actually going to do this,” he said.

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