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May 13, 2016

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Legislative Wrap-Up 2016: Health Care

by | May 13, 2016

Health

This year, CCLP’s Health Program supported establishing an enterprise for the state’s hospital provider fee to preserve funding for health care and other programs. We also worked to expand access to Medicaid and to protect the sustainability of Colorado’s health insurance marketplace, Connect for Health Colorado. Finally, we worked on several bills intended to address the cost and affordability of health care in Colorado.

Here’s a recap of our health care issues during the 2016 legislative session:

Fiscal issues and the state budget
Established in 2009, the hospital provider fee is a funding mechanism which imposes a fee on Colorado hospitals and uses fee revenue to generate Medicaid matching dollars from the federal government.  The fee has permitted Colorado to increase hospital reimbursements for indigent clients, fund Medicaid expansions and improve the quality of care in Medicaid by offering incentives to hospitals to make quality improvements — all without using General Fund dollars. Revenue generated by the hospital provider fee, about $600 million annually, is counted toward the state’s TABOR revenue limit.

Unfortunately, for the first time since the Hospital Provider Fee was established, Colorado’s revenues exceeded TABOR’S spending limits in 2015. As a result, this year, the state was required to return $109 million to taxpayers in the form of rebates of between $34 and $108 per taxpayer. The $109 million in rebates due taxpayers had to come out of the state’s General Fund, which meant there was less money available for K-12 education, higher education, human services and road repair. To rectify this vexing fiscal issue, lawmakers introduced legislation in 2015 and again in 2016 that would have created a state enterprise to collect and administer the hospital provider fee – exempting the revenue from TABOR’s spending limits and making it less likely that Colorado would exceed the TABOR limit in future years.

CCLP supported this year’s effort to establish a provider fee enterprise, House Bill 1420, because it would have eliminated pressure to reduce hospital provider fee revenue and preserve funding for other important programs. A companion bill, HB 1450, would have allocated the additional state revenues available because of the establishment of the provider-fee enterprise to the state severance tax fund, the state education fund, the college opportunity fund, the general fund, the capital construction fund and the highway-users tax fund. However, while HB 1420 passed the House, it failed in the Senate, nullifying efforts to preserve the funding this year.

Whether or not a hospital provider fee enterprise ever becomes a reality, CCLP maintains that at some point, the legislature or voters will need to address this serious fiscal quandary that reduces the amount of general fund revenue available to support critical programs and services outside the scope of health care.

Medicaid
Several bills in the 2016 session attempted to address coverage gaps and restrictions in Medicaid, including:

  • HB 1277 adds protections to the Medicaid appeals process by extending the time period for clients to file appeals from 30 to 60 days. The bill also makes it easier for clients to request informal dispute resolution without losing their right to a formal appeal. The opportunity for a fair hearing before public benefits are modified, reduced, suspended or terminated is a protection guaranteed under the Constitution. CCLP worked with the Colorado Cross Disability Coalition and Colorado Legal Services on HB 1277 because the modifications called for under the bill, while modest, will make the appeals process more accessible to vulnerable clients. The bill passed both chambers of the Colorado legislature and has been sent to the governor.
  • HB 1321 permits people living with disabilities to work without fear of losing critical Medicaid services. The bill adds a buy-in option to the Home and Community-Based (HCBS) Supported Living Services Waiver and the HCBS Spinal Cord Injury waiver. HCBS waiver programs are designed to support individuals with health and long-term care needs to remain in the community. Buy-in programs work by raising the income limit for participation in the program and requiring participants with higher incomes to pay a sliding scale premium. CCLP supported HB 1321 because we believe people should not have to choose between working and maintaining access to critical medical and long-term care services that enable them to remain in their homes. The bill passed both chambers of the Colorado legislature and has been sent to the governor.
  • Senate Bill 162, which would have authorized non-Medicaid providers to see Medicaid patients, even though Medicaid cannot pay for such services or for any testing, prescriptions or referrals made by a non-Medicaid enrolled provider. CCLP opposed the bill because we believe the solution to the problem of provider access is to improve Medicaid reimbursements to primary care providers and enforce access requirements in capitated payment arrangements. The bill passed the Senate but was postponed indefinitely in the House.
  • SB 170 would have required the Colorado Department of Health Care Policy and Financing to seek a federal waiver to purchase private insurance through the Exchange for those who are eligible for Medicaid but prefer to enroll in private insurance. CCLP testified in committee that approval of such a waiver would be contingent on a demonstration of cost-neutrality to the federal government and that it was highly unlikely that Colorado would be granted such a waiver. The measure was approved in amended form by the Senate and postponed indefinitely in the House.
  • Interim Committee 2016-04: At the request of Rep. Dianne Primavera, D-Broomfield, the Legislative Council authorized an interim committee to examine the form, content and frequency of communication between HCPF and Medicaid clients. The committee will be comprised of six members — three from each chamber. The committee, was formed because legislators have received numerous constituent complaints about HCPF’s correspondence system. It will meet four times and may refer up to five bills.

Connect for Health Colorado
There were several bills aimed at the State’s Health Benefits Exchange (doing business as Connect for Health Colorado), including:

  • HB 1148 was a response to a perceived lack of transparency in the way policy decisions were made by Connect for Health Colorado. CCLP opposed the bill as initially drafted as it would have given the Legislative Oversight Committee the ability to repeal any rule or policy concerning the bidding and awarding of contracts by Connect, carrier and broker participation in Connect, interactions with state agencies, management and compensation of the assistance network, and appeals. CCLP worked to amend the bill, which as passed requires additional public processes around Connect policy decisions, including the establishment of a public advisory committee. The measure was passed by the Colorado legislature and signed in to law by the governor.
  • SB 6 concerns the use of brokers in assisting consumers with enrollment in plans through Connect for Health Colorado. This bill is one of several directed at the marketplace, and it aimed to codify a practice of referring customers to brokers, whether they use Connect’s website or speak to customer-service representatives In our view, by strongly favoring brokers, this bill may disserve customers who might benefit from a health coverage guide because they need financial assistance or have more complex health needs. CCLP opposed the bill initially, but withdrew opposition after the legislation was amended. The bill passed both houses and has been sent to the governor.
  • SB 2 would have required the Secretary of State to submit to the voters the question of whether Connect for Health Colorado could impose a fee on insurance carriers that sell insurance plans on the state exchange. CCLP opposed the bill because it would have inappropriately categorized the fee as a tax and, in doing so, would have jeopardized funding that is critical to the sustainability of the exchange. The bill passed the Senate but was postponed indefinitely in the House.

Cost and affordability
At least four bills attempted to address health care cost and affordability, but only one was approved by legislators. They include:

  • HB 1102 sought to make public information about the underlying costs related to the manufacture, marketing and sale of prescription drugs. Similar bills have been attempted in states around the country. To date, all such legislation has failed due to very strong opposition from the pharmaceutical industry. CCLP supported HB 1102 as a step towards cost transparency, but the bill died in its first committee.
  • HB 1336 requires the Colorado Department of Insurance (DOI) to study the effects of reducing Colorado’s current insurance rating areas from nine to one. CCLP supported this bill as a means of investigating solutions to extraordinary health insurance costs in many mountain and rural communities and as a means of analyzing the drivers of health care costs in Colorado. The bill passed both chambers and has been sent to the governor.
  • HB 1381 would have closed a health insurance coverage gap by clarifying that coverage for breast-cancer screenings applies to the imaging modality or combination of modalities that are appropriate for each individual’s breast health needs. Under the ACA, screenings for certain cancers are considered preventive care and not subject to cost-sharing, including mammograms. However, the procedures that are not subject to cost-sharing do not always align with clinical standards of care to complete a cancer screening. The result is a coverage gap that means that some individuals pay out-of-pocket costs to complete a preventive screening. CCLP supported the bill as an important ACA-cleanup measure. It passed the House but was postponed indefinitely in the Senate.
  • SB 152 sought to require providers and facilities to provide notice about the potential for balance billing and the protections that exist against balance billing to individuals seeking care at in and out of network facilities or with in and out of network providers and made it a violation of the deceptive trade practice act to fail to provide such notice. The bill was postponed indefinitely in its first committee.  CCLP strongly supported a similar bill last year and after that bill died, the Colorado Medical Society and the Colorado Association of Health Plans participated in a facilitated process to determine whether they could reach agreement on the subject of balance billing and network adequacy requirements.  That facilitated process was expected to lead to a bill, but did not.  Colorado consumers in the meantime, continue to face the prospect of surprise medical bills.

PACE ombuds program
In its role as a watchdog organization, CCLP participated on behalf of the public interest in the proceeding before the Colorado Attorney General concerning the conversion of InnovAge’s Program of All Inclusive Care for the Elderly (PACE). Among the recommendations we and others made was that the Attorney General ought to establish an ombuds program to ensure the protection of vulnerable PACE clients during the transition of InnovAge from a non-profit to a for-profit organization.  The Attorney General ordered the conversion foundation to pay for an ombuds position in the Colorado Department of Human Services (CDHS) but the establishment of such a program in CDHS required legislative authorization.

SB 199 established the PACE ombudsman position in CDHS. The bill also requires CDHS to convene a stakeholder process during the interim and return to lawmakers with longer term recommendations for the PACE ombuds program. CCLP supported the establishment of an ombuds position and SB 199 passed both chambers of the Colorado legislature. The bill has been sent to the governor.

– Elisabeth Arenales

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HEALTH:
HEALTH FIRST COLORADO (MEDICAID)

Health First Colorado is the name given to Colorado’s Medicaid program. Medicaid provides public, low-cost health insurance to qualifying adults and children. It is an entitlement program funded by the federal, state, and county governments and is administered by counties in Colorado. Those who are required to pay must pay a small co-pay when receiving certain health care services.

State Department: Department of Health Care Policy and Financing

Eligibility: Most adults 18 to 64 are eligible for Medicaid in Colorado if their household income is at or below 133% of the federal poverty limit (FPL). Pregnant women are eligible with incomes of up to 195% FPL, while children under 18 may be eligible if the live in a household with income at or below 142% FPL. Some adults over 65 may also be eligible for Medicaid.

Program Benefits: Through Medicaid, low-income Coloradans are eligible for a range of health care services at little to not cost. Services provided include doctors visits, prescription drugs, mental health services, and dental care. Co-pays for certain individuals may be needed for certain services.

Program Funding and Access: Colorado funds our Medicaid program through state and federal dollars. Medicaid is an entitlement program, which means that all who are eligible for Medicaid can access the program, regardless of the funding level in a given year. This does not mean that it is always easy to access Medicaid, even when eligible. And since the program is administered by counties, funding levels for county staff and other administrative roles can make it easier or harder for Coloradans to access the program. On top of this, not all medical providers accept Medicaid which limits the ability of Coloradans to seek health services even if enrolled, such as if the nearest provider is a 2+ hour drive away.

Note: This data is from before the pandemic and does not reflect changes in enrollment rules during the COVID-19 pandemic and public health emergency.

Statewide Program Access 2015-19: Over the study period of this report, an average of 89.0% of the population at or below 133% of FPL (i.e., the population who is likely to be eligible for Medicaid) were enrolled in Medicaid in Colorado.

FOOD SECURITY:
SUPPLEMENTAL NUTRITION ASSISTANCE PROGRAM (SNAP)

The Supplemental Nutrition Assistance Program or SNAP helps low-income Coloradans purchase food by providing individuals and families with a monthly cash benefit that can be used to buy certain foods. SNAP is an entitlement program that is funded by the federal and state governments and administered by counties in Colorado.

State Department: Department of Human Services

Eligibility: Currently, Coloradans qualify for SNAP if they have incomes below 200% FPL, are unemployed or work part-time or receive other forms of assistance such as TANF, among other eligibility criteria. Income eligibility for SNAP was different during the study period of this report than today—it was 130% FPL back in 2019 for example. The US Department of Agriculture uses the population at or below 125% FPL when calculating the Program Access Index (or PAI) for SNAP. We follow this practice in our analysis despite Colorado currently having a higher income eligibility threshold.

Program Benefits: SNAP participants receive a monthly SNAP benefit that is determined by the number of people in their household and their income. Benefit amounts decrease as income increases, helping households avoid a sudden loss of SNAP when their incomes increase, even by a minor amount. Benefits are provided to an Electronic Benefit Transfer (EBT) card that can be used to purchase eligible food items, such as fruits and vegetables; meat, poultry, and fish; dairy products; and breads and cereals. Other items, such as foods that are hot at their point of sale, are not allowable purchases under current SNAP rules.

Program Funding and Access: SNAP, like Medicaid, is a federal entitlement program. This means that Colorado must serve any Coloradan who is eligible for the program. As such, funding should not be a limit to how many Coloradans can be served by the program. However, funding for administration of SNAP at the state and county level can limit the ability of county human service departments to enroll those who are eligible. Other program rules and administrative barriers can make it difficult for Coloradans to receive the benefits they are legally entitled to receive.

Statewide Program Access 2015-19: Over the study period of this report, an average of 61.1% of the population at or below 125% of FPL (i.e., the population who is likely to be eligible for SNAP) were enrolled.

FOOD SECURITY:
SPECIAL SUPPLEMENTAL NUTRITION PROGRAM FOR WOMEN, INFANTS AND CHILDREN (WIC)

The Special Supplemental Nutrition Program for Women, Infants, and Children, also know as WIC, provides healthcare and nutritional support to low-income Coloradans who are pregnant, recently pregnant, breastfeeding, and to children under 5 who are nutritionally at risk based on a nutrition assessment.

State Department: Department of Public Health and Environment

Eligibility: To participate in WIC you must be pregnant, pregnant in the last six months, breastfeeding a baby under 1 year of age, or a child under the age of 5. Coloradans do not need to be U.S. citizens to be eligible for WIC. In terms of income, households cannot have incomes that exceed 185% FPL. Families who are enrolled in SNAP, TANF, Food Distribution Program on Indian Reservations (FDPIR), or Medicaid are automatically eligible for WIC. Regardless of gender, any parents, foster parents, or caregivers are able to apply for and use WIC services for eligible children.

Program Benefits: WIC provides a range of services to young children and their parents. These include funds to purchase healthy, fresh foods; breastfeeding support; personalized nutrition education and shopping tips; and referrals to health care and other services participants may be eligible for.

Program Funding and Access: WIC is funded by the US Department of Agriculture. The state uses these federal funds to contract with local providers, known as WIC Clinics. In most cases, these are county public health agencies, but that is not the case in all Colorado counties. Some WIC Clinics cover multiple counties, while others are served by multiple clinics. Private non-profit providers are also eligible to be selected as a WIC Clinic.

Statewide Program Access 2015-17: Between 2015 and 2017, an average of 52.2% of the population eligible for WIC were enrolled in the program in Colorado.

Financial Security:
Colorado Works

Colorado Works is the name given to Colorado’s program for Temporary Assistance to Needy Families or TANF. It is an employment program that supports families with dependent children on their path to self-sufficiency. Participants can receive cash assistance, schooling, workforce development and skills training depending on the services available in their county.

State Department: Department of Human Services

Eligibility: In general, Coloradans are eligible to enroll in TANF if they are a resident of Colorado, have one or more children under the age of 18 or pregnant, and have very low or no income. For example, to be eligible to receive a basic cash assistance grant through TANF, a single-parent of one child could not earn more than $331 per month, with some exclusions—and would only receive $440 per month (as of 2022). That said, there are other services provided by counties through TANF that those with incomes as high as $75,000 may be eligible for. In addition to these, participants in TANF are required to work or be pursuing an eligible “work activity” or work-related activity. Any eligible individual can only receive assistance if they have not previously been enrolled in TANF for a cumulative amount of time of more than 60 months—this is a lifetime limit that does not reset. Counties may have additional requirements and offer benefits that are not available in other counties in Colorado.

Program Benefits:  While the exact benefits that one is eligible for under TANF can vary, all qualified participants are eligible to receive a monthly cash payment, call basic cash assistance. Other than cash assistance, counties are have a lot of choice in how to use their TANF funding; generally a use of TANF funds is appropriate so long as it advances one or more of the four purposes of the program: (1) provide assistance to needy families so that children can be cared for in their own homes or in the homes of their relatives; (2) end the dependence of needy families on government benefits by promoting job preparation, work, and marriage; (3) prevent and reduce the incidence of out-of-wedlock pregnancies; and (4) encourage the formation and maintenance of two-parent families.

It is important to note that those eligible for TANF are also eligible for many of the other programs we’ve included in this report, such as SNAP, Medicaid, and CCCAP.

Program Funding and Access: Colorado funds its TANF program through funds received from the federal government through the Temporary Assistance for Needy Families block grant. Most of the federal funds are allocated by the state to counties, which are required to provide a 20% match of state funding. Federal and state rules allow the state and counties to retain a portion of unspent funds in a TANF reserve.

Statewide Program Access 2015-19: Over the study period of this report, an average of 50.7% of the population at or below 100% of FPL (i.e., the population who is likely to be eligible for TANF) were enrolled in TANF in Colorado.

EARLY LEARNING:
COLORADO CHILD CARE ASSISTANCE PROGRAM (CCCAP)

The Colorado Child Care Assistance Program provides child care assistance to low-income families and caregivers living in Colorado in the form of reduced payments for child care. It is a program funded by the federal, state, and county governments and is administered by counties in Colorado. The share owed by parents/caregivers is determined on a sliding scale based on the family’s income.

State Department: Department of Early Childhood Education

Eligibility: Counties set eligibility for families separately, but must serve families with incomes at or below 185% of the Federal Poverty Limit. Families accepted to the program are no longer eligible once their income exceeds 85% of the state median income. Parents or caregivers must be employed, searching for work, or engaged in another approved activity to be eligible for CCCAP. Parents and caregivers enrolled in Colorado Works (Temporary Assistance to Needy Families or TANF) or in the child welfare system are also eligible to participate in CCCAP. Generally, CCCAP serves families with children under 13, although children as old as 19 may be eligible under certain circumstances.

Program Benefits: If a family is eligible for CCCAP and has income, they may likely have to pay a portion of their child’s or children’s child care costs each month. The amount that families owe is based on their gross income, number of household members, and the number of children in child care in the household. As such, households tend not to experience a benefit cliff with CCCAP when they see their incomes increase

Program Funding and Access: Colorado funds the CCCAP program using federal dollars it receives from the Child Care and Development Block Grant program. The state allocates federal and state funds to counties using a formula that takes into account factors like current caseloads and the number of eligible residents. Assistance is available until the county’s funds are spent, so the number of families that can be served is often a function of how much funding is available and the income and composition of the household that applies. It is not uncommon for counties to overspend or underspend their allocations of funds. The state reallocates unspent funds from counties who underspent to those who overspent. While underspending could indicate a problem with the way a county administers its CCCAP program, it could just as likely be a sign that there are few providers in the county who participate in CCCAP—or a lack of providers generally.

Statewide Program Access 2015-19: Over the study period of this report, an average of 10.8% of the population at or below 165% of FPL and younger than age 13 (i.e., the population who is likely to be eligible for CCCAP) were enrolled in CCCAP.

Housing:
HUD rental assistance programs

The US Department of Housing and Urban Development (HUD) has three housing assistance programs that we look at together: Housing Choice Vouchers (Section 8), Project-based Section 8, and Public Housing. In Colorado, these programs provided assistance to over 90% of the households who received federal housing assistance from all HUD programs. Through federally funded, local or regional public housing agencies (PHAs) are the agencies that administer these programs, through not all are available in all counties. These are not the only programs available in Colorado that assist households afford the cost of housing, such as units funded through federal and state tax credit programs.

State Department: Department of Local Affairs

Eligibility: Generally, households with incomes under 50% of the area median income (AMI) of the county they live in are eligible for these rental assistance programs, although PHAs have discretion to select households with incomes at higher percentages of AMI. That said, HUD requires that 75% of new vouchers issued through the Housing Choice Voucher/Section 8 program in a given year are targeted to households with incomes at or below 30% of AMI. PHAs are also able to create criteria that give priority to certain types of households who are on waiting lists for these programs.

Program Benefits: These rental assistance programs help households afford the cost of housing by reducing their housing costs to around 30% of their household income. In the case of the Housing Choice Voucher program, the PHA pays the voucher holder’s landlord the remaining portion of the rent.

Program Funding and Access: Funding and access are both challenges for these rental assistance programs. In addition to limitations on the number of public housing units or housing vouchers a PHA can manage or issue, lack of funding compared to the need constrains the ability of PHAs to assist low-income households. In 2020, Coloradans were on waitlists for Housing Choice Vouchers for an average of 17 months. Waitlists also exist for the other rental assistance programs.

Statewide Program Access 2015-19: Over the study period of this report, an average of 21.1% of renter households with incomes at or below 50% AMI (i.e., the population who is likely to be eligible for HUD rental assistance programs) were living in subsidized housing.