Nevada Debuts Public Option Amid Tumultuous Federal Changes to Health Care

More than 10,000 people have signed up for Nevada’s new public health plans, which debuted last fall in hopes they would lead to lower prices in the health insurance market.

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, joining Colorado and Washington. The idea is to offer consumers lower-cost plans to expand access to healthcare.

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

The public option gained attention in the late 2000s when Congress considered, but ultimately rejected, the creation of a government-funded and managed health plan that would compete in the market with private carriers. The programs in Washington, Colorado and Nevada don’t go that far: They are not government-run but are public-private partnerships that compete with private insurance.

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

The Washington and Colorado programs have faced challenges, including a lack of participation from clinicians, hospitals and other health care providers, as well as the inability of insurers to meet rate reduction criteria or lower premiums compared to other plans on the market.

Nevada law requires insurers of state option plans – Battle Born State Plans, named for a state motto – to reduce premium costs by 15 percent compared to a market-leading “silver” plan over the next four years.

But that amount might not make much difference to consumers, whose premiums are rising because of the loss of the ACA’s enhanced tax credits, said Keith Mueller, director of the Rural Policy Research Institute.

“It’s not a lot of money,” Mueller said.

Three of the eight insurers listed on the state’s stock exchange, Nevada Health Link, offered the state’s plans during the open enrollment period.

Insurance companies plan to meet Nevada’s premium cost reduction requirement by reducing broker fees and commissions, which has sparked opposition from the state’s insurance brokers. In response, Nevada market officials told state lawmakers in January that they would provide a flat rate refund to brokers.

The public option faced opposition from state leaders. In 2024, a state judge dismissed a lawsuit brought by a Nevada state senator and a tax-cutting group that challenged the Public Option Act as unconstitutional. They appealed to the state Supreme Court.

Impacts on federal policy

Recent federal changes create more obstacles.

Nevada is consistently among the states with the largest population of people without health insurance coverage. Last year, nearly 95,000 people in the state benefited from the enhanced ACA tax credits, representing an average savings of $465 per month, according to KFF, a nonprofit health news organization that includes KFF Health News.

But the enhanced tax credits expired at the end of the year and it appears unlikely that lawmakers will reinstate them. ACA enrollment nationwide has declined by more than 1 million people so far this year, down from a record 24 million last year.

According to the Congressional Budget Office, about 4 million people are expected to lose their health coverage because of the expiration of tax credits. An additional 3 million people are expected to lose coverage due to other policy changes affecting the market.

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

In Nevada, the changes would result in a loss of coverage for about 100,000 people, according to KFF.

“All of this makes getting coverage on Nevada Health Link more difficult and more expensive than it would be otherwise,” Giovannelli said.

State officials projected, before 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 had enrolled in one of the public option plans, according to Nevada Health Link.

Katie Charleson, communications manager for the state health exchange, said the initial enrollment estimate was based on market conditions before recent increases in customer premium costs. She said public option plans offer more choices to people facing higher costs.

“We expect enrollment in Battle Born State plans to increase over time as awareness increases and Nevadans continue to seek quality coverage options that help lower costs,” Charleson said.

According to KFF, nationally, the enhanced subsidies saved enrollees an average of $705 per year in 2024, and enrollees would save an average of $1,016 in premiums in 2026 if the subsidies were still in place. Without the subsidies, enrollees in the ACA marketplace could see their premiums more than double.

Overviews of Washington and Colorado

Washington and Colorado do not plan to change their programs due to the expiration of tax credits, according to government officials in those states.

Other states that had recently considered creating public options have backed away. Minnesota officials delayed approval of a public option until 2024, citing funding concerns. Proposals to create public options in Maine and New Mexico also failed.

Washington initially saw little enrollment in its Cascade Select public option plans; just 1% of enrollees in the state marketplace chose a public options plan in 2021. But that changed after lawmakers required hospitals to contract with at least one public options plan by 2023. Last year, the state reported that 94,000 customers enrolled, representing 30% of all customers in the state marketplace. Public option plans were the lowest premium silver plans in 31 of Washington’s 39 counties in 2024.

A 2025 study found that since Colorado implemented its public option, called the Colorado Option, coverage through the ACA marketplace has become more affordable for enrollees who received subsidies, but more expensive for enrollees who did not.

Colorado requires all insurers offering coverage in its market to include a public option that meets state guidelines. The state has set premium reduction goals of 5% per year for three years starting in 2023. Starting this year, the cost of premiums cannot exceed medical inflation.

Although insurers offering the public option have not met premium reduction targets, enrollment in the Colorado option has increased each year it has been available. Last year, the state saw a record number of enrollments in its marketplace, with 47% of customers purchasing a public options plan.

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

“States are responding and trying to continue to do right by their residents,” Giovannelli said, “but you can’t fill all those gaps.”

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