Imagine if California, New York, Illinois, Massachusetts, and Washington — together representing 87 million people — joined forces to create a shared health insurance market. That collective scale could drive hospital reimbursement rates down, cut pharmaceutical prices, and lower monthly premiums by hundreds of dollars. It’s not a fantasy. The legal framework to do exactly this already exists.
A Dormant Power in the Affordable Care Act
Section 1333 of the Affordable Care Act (ACA) allows states to form Health Care Choice Compacts, enabling qualified health plans to operate across state lines. Enacted in 2010 and effective since January 1, 2016, it has never been used — not once.
While Democratic governors have coordinated on vaccine guidance, Section 1333 (42 U.S.C. § 18053) offers something far more consequential: genuine market leverage capable of saving billions for millions. For fifteen years, this authority has sat idle.
The statute permits two or more states to pass enabling legislation and jointly apply to the Department of Health and Human Services (HHS). HHS must approve any compact that:
- Meets essential health benefit standards,
- Maintains ACA-level affordability protections,
- Covers at least as many residents,
- Doesn’t raise the federal deficit, and
- Upholds all applicable enforcement laws.
These safeguards ensure compacts serve the public rather than enabling substandard “junk” insurance to cross borders.
Although HHS has never issued implementing regulations — and is not legally required to — no state has submitted an application or enacted the necessary legislation. As of 2025, Georgetown University’s Center on Health Insurance Reforms confirmed that the provision remains untouched.
The Missed Opportunity
Colorado’s 2023 public-option rollout demonstrates what’s possible. By 2025, 132,791 residents — nearly half of marketplace enrollees — had joined. Premiums for the lowest-cost Silver plans dropped by $100 per month. Multiply that success by five states, and the potential becomes transformative: an interstate market of 87 million people with unified negotiating power over hospitals, drugmakers, and insurers.
If just 10 percent of that population saved $100 per month, families would keep $10 billion a year in their pockets. The Northwest Prescription Drug Consortium’s coordinated purchasing achieved $99 million in savings between 2016 and 2019 — proof that scale drives affordability.
Why It Hasn’t Happened
Politics, not practicality, has stalled progress. HHS under both parties ignored Section 1333. State legislatures never pushed for implementation. Insurance lobbies resist anything that strengthens public negotiating power. And while provider-network logistics pose challenges, market size solves most of them. States could even tie Medicaid contracts or facility licenses to provider participation.
Critics claim Section 1333 was meant to promote conservative deregulation. Perhaps. But the statute’s language demands comprehensive coverage and affordability protections. It can just as easily underpin progressive reforms — including powerful public-option markets.
A Blueprint for Blue-State Action
Regional public-health alliances formed after federal agencies were undermined during the Trump era prove states can cooperate. Yet vaccine coordination only scratches the surface. Economic relief through lower healthcare costs is where real change happens.
Section 1333 is the legislative lever for that transformation — a dormant tool that could lower premiums, curb drug prices, and rebalance hospital billing power. It’s practical, lawful, and waiting for political will.
What You Can Do
Ten Democratic governors can activate this authority now. Contact them and ask them to use Section 1333 to create an interstate public option:
- California Governor Gavin Newsom: Contact | (916) 445-2841
- New York Governor Kathy Hochul: Contact Form
- Illinois Governor J. B. Pritzker: Contact | (217) 782-0244
- Massachusetts Governor Maura Healey: Email | (617) 725-4005
- Washington Governor Bob Ferguson: Contact | (360) 902-4111
- Pennsylvania Governor Josh Shapiro: Website | (717) 788-8990
- Michigan Governor Gretchen Whitmer: Contact | (517) 335-7858
- Colorado Governor Jared Polis: Contact Us | (303) 866-2471
- New Jersey Governor Phil Murphy: Contact All | (609) 292-6000
- Minnesota Governor Tim Walz: Contact | (651) 201-3400
When you reach out, share why healthcare affordability matters to you. Mention Colorado’s success — $1,200 annual savings per family — and urge them to replicate it regionally. The solution exists; it only needs leaders willing to act.
Healthcare costs are crushing families. Democratic governors already have the power to change that — if they choose to use it.
References
- Centers for Medicare & Medicaid Services (2019). Patient Protection and Affordable Care Act; Increasing consumer choice through the sale of individual health insurance coverage across state lines through health care choice compacts. Federal Register 84(47): 8657–8660
- Colorado Division of Insurance (2025). Colorado Option lowers premiums and saves Coloradans money.
- Governor of California (2025, Sept 3). California, Oregon, and Washington to launch new West Coast Health Alliance.
- Governor of California (2025, Sept 4). Hawaii to join West Coast Health Alliance.
- Massachusetts Department of Public Health (2025, Sept 18). Northeast Public Health Collaborative Announcement.
- Murray & Whaley (2025). Can public option plans improve affordability? Insights from Colorado.
- Northwest Prescription Drug Consortium (2020). NW Consortium Overview.
- Patient Protection and Affordable Care Act § 1333, 42 U.S.C. § 18053 (2010).
- Pogue, S. (2025). A Blast from the Past: Dusting Off ACA Section 1333 Compacts.
- Polis, J. (2025). Governor Polis Announces Record Colorado Option Enrollment.
