Nevada's Public-Option Health Plans Face Enrollment Challenges Amid Federal Changes

More than 10,000 people have enrolled in Nevada's new public-option health plans, which debuted last fall with the expectation that they would bring lower prices to the health insurance market.

Those preliminary numbers from the open enrollment period that ended in January are less than a third of what state officials had projected. Nevada is the third state so far to launch a public option plan, along with Colorado and Washington state. The idea is to offer lower-cost plans to consumers to expand health care access.

But researchers said plans like these are unlikely to fill the gaps left by sweeping federal changes, including the expiration of the subsidies for plans bought on Affordable Care Act marketplaces.

The public option gained attention in the late 2000s when Congress considered but ultimately rejected creating a health plan funded and run by the government that would compete with private carriers in the market. The programs in Washington state, Colorado, and Nevada don't go that far – they aren't government run, but are private-public partnerships that compete with private insurance.

In recent years, states have considered creating public-option plans to make health coverage more affordable and to reduce the number of uninsured people. Washington was the first state to launch a program, in 2021, and Colorado followed in 2023.

Washington and Colorado's programs have run into challenges, including a lack of participation from clinicians, hospitals, and other care providers, as well as insurers' inability to meet rate reduction benchmarks or lower premiums compared with other plans offered on the market.

Nevada law requires that the carriers of the public-option plans — called "Battle Born State Plans" after a state motto — lower premium costs compared to a benchmark silver plan in the marketplace by 15% over the next four years.

But that amount might not make much difference to consumers with rising premium payments from the loss of the ACA's enhanced tax credits, said Keith Mueller, director of the Rural Policy Research Institute."That's not a lot of money," Mueller said.

Three of the eight insurers on the state's exchange, Nevada Health Link, offered the state plans during the open enrollment period.Insurance companies plan to meet the lower premium cost requirement in Nevada by cutting broker fees and commissions, which prompted opposition from insurance brokers in the state. In response, Nevada marketplace officials told state lawmakers in January that they will give a flat-fee reimbursement to brokers.

The public option has faced opposition among state leaders. In 2024, a state judge dismissed a lawsuit, brought by a Nevada state senator and a group that advocates for lower taxes, that challenged the public-option law as unconstitutional. They have appealed to the state Supreme Court.

Nevada is consistently among the states with the largest populations of people who do not have health insurance coverage. Last year, nearly 95,000 people in the state received the enhanced ACA tax credits, averaging $465 in savings per month, according to KFF, a health information nonprofit that includes KFF Health News.

But the enhanced tax credits expired at the end of the year, and it appears unlikely that lawmakers will bring them back. Nationwide ACA enrollment has decreased by more than 1 million people so far this year, down from record-high enrollment last year of 24 million.

About 4 million people are expected to lose health coverage from the expiration of the tax credits, according to the Congressional Budget Office. An additional 3 million are projected to lose coverage because of other policy changes affecting the marketplace.

The changes to the ACA in Republicans' One Big Beautiful Bill Act, which President Donald Trump signed into law last summer, will make it more difficult for people to keep their coverage, said Justin Giovannelli, an associate research professor at the Center on Health Insurance Reforms at Georgetown University. These changes include more frequent enrollment paperwork verifying income and other personal information, a shortened enrollment window, and an end to automatic reenrollment.

In Nevada, the changes would amount to an estimated 100,000 people losing coverage, according to KFF.

"All of that makes getting coverage on Nevada Health Link harder and more expensive than it would be otherwise," Giovannelli said.State officials projected ahead of open enrollment that about 35,000 people would purchase the public-option plans. Of the 104,000 people who had purchased a plan on the state marketplace as of mid-January, 10,762 of them had enrolled in one of the public-option plans, according to Nevada Health Link.

Katie Charleson, communications officer for the state health exchange, said the original enrollment estimate was based on market conditions before the recent increases in customers' premium costs. She said that the public-option plans gave people facing higher costs more choices.

"We expect enrollment in Battle Born State Plans to grow over time as awareness increases and as Nevadans continue seeking quality coverage options that help reduce costs," Charleson said.

According to KFF, nationally the enhanced subsidies saved enrollees an average of $705 annually in 2024, and enrollees would save an estimated $1,016 in premium payments on average in 2026 if the subsidies were still in place. Without the subsidies, people enrolled in the ACA marketplace could be seeing their premium costs more than double.

Washington and Colorado are not planning to make any changes to their programs as a result of the expired tax credits, according to government officials in those states.

Other states that had recently considered creating public options have backtracked. Minnesota officials put off approving a public option in 2024, citing funding concerns. Proposals to create public options in Maine and New Mexico also sputtered.

Washington initially saw meager enrollment in its Cascade Select public-option plans -- just 1% of the state marketplace enrollees chose the public-option plan in 2021. But that changed after lawmakers required that hospitals contract with at least one public-option plan by 2023. Last year the state reported that 94,000 customers enrolled, accounting for 30% of all customers on the state marketplace. The public-option plans were the lowest-premium silver plans in 31 of Washington's 39 counties in 2024.

A 2025 study found that in the years since Colorado implemented its public option, called the Colorado Option, coverage through the ACA marketplace became more affordable for enrollees who received subsidies but more expensive for enrollees who did not.Colorado requires all insurers offering coverage through its marketplace to include a public option that follows state guidelines. The state set premium reduction targets of 5% a year for three years beginning in 2023. Starting this year, premium costs are not allowed to outpace medical inflation.

Though the insurers offering the public option did not meet the premium reduction targets, enrollment in the Colorado Option has increased every year it has been available. Last year, the state saw record enrollment in its marketplace, with 47% of customers purchasing a public-option plan.

Giovannelli said states are continuing to try to make health insurance more affordable and accessible, even if federal changes reduce the impact of those efforts.

"States are reacting and trying to continue to do right by their residents," Giovannelli said, "but you can't plug all those gaps."