Establishing a federal public option has been identified by some as a way to address health care challenges such as rising costs, lack of competition among health insurers in certain markets, and increasing uninsured rates. However, in 2021 the design and passage of a federal public option would take time and political will and, if passed, could take years to implement.

Some states are not waiting for federal action. Nearly a dozen states are exploring the concept of a state-based public option or are actively pursuing some version of this approach through legislation. Driven by state-specific policy goals and coverage and by insurance market dynamics, these initiatives are diverse — including private-public partnerships with existing insurance carriers, allowing residents to buy into an existing government program such as Medicaid or the state employee health plan, and other arrangements.

This issue brief outlines some of the problems states are seeking to address with their public option proposals, reports the proposals’ current status, categorizes the public option proposals into archetypes, and identifies important issues for California policymakers to consider as they explore the use of a state-based public option. It focuses specifically on the experiences of Colorado, Nevada, New Mexico, Oregon, and Washington.

About the Authors

This paper was authored by the following team at Manatt Health Strategies: Kyla M. Ellis, MPH, MBA, manager; Joel S. Ario, JD, managing director; Cindy Mann, JD, partner; and Virginia E. Morgan, MPH, consultant. Manatt Health Strategies is a consulting subsidiary of Manatt, Phelps & Phillips, and combines legal excellence, firsthand experience in shaping public policy, strategy insight, and deep analytic capabilities to provide professional services to the full range of health industry players.