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News

Nov 15, 2018

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State budget requests provide a hopeful glimpse to Colorado’s future

by | Nov 15, 2018

Family Economic Security, Health

Colorado Center on Law and Policy (CCLP) is encouraged by many of the requests outlined in Gov. John Hickenlooper’s proposed budget for fiscal year 2019-20 – particularly the recommendations that pertain to the economic security, health and career opportunities for low-income Coloradans.

This year’s $33.4 billion budget request reflects a 4.8 percent increase in total funds – of which 41 percent is earmarked for “strategic investments” intended to improve health care, make child care and college more affordable and build a strong workforce for the economy of the future.

We believe many of these requests warrant careful consideration when the General Assembly convenes in January.

Here are the budget highlights for our Family Economic Security and Health Care programs and some thoughts from CCLP’s Chaer Robert and Elisabeth Arenales.

Family Economic Security
Requests from Colorado’s Department of Human Services include:

* An annual 1.5 percent Cost of Living Adjustment (COLA) for Colorado Works’ Basic Cash Assistance (BCA). BCA recipients are among the lowest-income residents of the state and usually have no other source of income. Earlier this year, CCLP and its partners successfully urged Colorado’s Human Services Board to increase BCA for the first time in 10 years by 10 percent. Unfortunately, since the time Colorado Works (the state’s Temporary Assistance to Needy Families [TANF] program) was established in 1997, the purchasing power of Colorado’s BCA has decreased by 35 percent because the grant amount has not kept pace with inflation. On average, a single-parent family with two children receives a maximum BCA payment of $508 a month (providing income that puts them at just 29 percent of the federal poverty level). CCLP’s Chaer Robert pointed out that this low funding level causes “an economic fragility that hurts kids and families’ quest to get back on their feet,” so an ongoing raise would help.

* An increase in $1 million total funds to solidify outreach, access and delivery of Supplemental Nutrition Assistance Program (SNAP) for a three-year project by increasing the state’s general fund dollars by $465,000 for matching federal dollars. The program would support programmatic activities to increase SNAP enrollment in rural and underserved communities. Robert said continuing the work of this expiring grant is a smart investment that benefits the state, local economies and hungry kids.

* The Department of Human Services also requested $966,977 in federal TANF funds in fiscal year 2019-20 and $1.8 million in fiscal year 2020-21 to provide employment services to low-income, non-custodial parents struggling to pay child support. The funds for county offices will serve up to 5,200 parents at an average cost of $300 per participant. Robert said the pilot programs make sense because they switch the emphasis from child-support “enforcement” to child-support “services,” which will help parents find and keep employment.

Regarding the governor’s tax credit proposals, Robert acknowledged that providing a match to the federal American Opportunity Tax Credit and the Lifelong Learning Credit can be helpful to some Colorado families. She notes that because the credits deal with current higher education expenses, they don’t address the student-debt problem – except to diminish some potential debt for students moving forward.

The budget also proposes increasing a state tax credit to individuals making $60,000 or less for child care expenses from a 50 percent match to the federal credit to 100 percent – while expanding the income cap to families making more than $60,000 but less than $150,000. Robert was disappointed that that increase would not include those covered by the Low-Income Child Care Tax Credit. Families earning less than $24,000 a year or single parents earning under $18,000 only benefit from this credit because their income is too low to owe federal taxes, and thus do not qualify for the regular Child Care Tax Credit. Robert added that CCLP is working on legislation to make the Low-Income Child Care Tax Credit permanent, rather than sunset every three years.

Finally, Robert said that a proposal to increase the state Earned Income Tax Credit (EITC) and pay the increased amount from funds that TABOR would otherwise require to be refunded would be good if the EITC remains permanent at 10 percent of the federal credit with an additional match in years of TABOR surplus. But she cautioned that structuring the EITC as only a TABOR refund mechanism would be a step back for Coloradans. The original state EITC was a TABOR surplus refund mechanism. Consequently, low-income working families did not receive an EITC between 2002-2014 because there was no TABOR surplus.

Health care
Requests from the Colorado Department of Health Care Policy and Financing (HCPF) include:

* Funding to design and adopt a new tool to measure the need for long-term home health care for adults and private-duty nursing services for Medicaid-enrolled children and adults. While CCLP supports the idea of using clinically validated tools to measure clients’ service needs, CCLP’s Elisabeth Arenales said she’s concerned by what appears to be HCPF’s presumption that the tool will generate substantial cost savings. “No tool used to determine medical necessity should be designed with cost savings as the goal,” Arenales said. “Cost savings may or may not result, but the tool should be used to determine how best to meet a client’s medical needs.”

* Using general fund dollars to support the All Payer Claims Data Base (APCD) – a tool intended to control and analyze health care costs through data collection. CCLP supports the budget request on the premise that the APCD was established to inform policy decisions based on independent, reliable data and data analysis. Unfortunately, without a reliable funding source, the Center for Improving Value in Health Care (or CIVHC, contracted by HCPF to develop the APCD) is limited in what it can do to benefit the state.  CCLP notes that the budget request seeks additional HCPF oversight over the APCD. We do not support that request, believing that current levels of statutory oversight are sufficient.

* Consolidating processes for mail sent to Medicaid clients and returned as undeliverable. HCPF reports that more than 3 million pieces of mail are returned each year to Colorado counties and medical assistance sites – endangering clients’ access to services and imposing an administrative burden on counties. According to HCPF, the proposal to let the state handle returned mail for Medicaid recipients from counties to the state will free up county resources devoted to handling these cases and allow for increased consolidation and oversight by the state. While CCLP supports these requests in principle, we are concerned that the volume of returned mail is due (at least in part) to delays in updating address information in the Colorado Benefits Management System (CBMS), a statewide computer network whose initial failure put hundreds of thousands of Coloradans in jeopardy without access to health care, medications, cash assistance and food. CCLP does not support this change until and unless sufficient protections are in place to ensure that clients are served. For example, there must be meaningful protocols for searching for client addresses and the state must be certain that counties are timely in entering new address information into CBMS.

* Providing additional funding for an IT project intended to expedite payments to health care providers for serving Medicaid clients. While CCLP supports the request, we remain concerned about HCPF IT management decisions that resulted in significant problems with the roll out of the COMMIT payment system project last year – resulting in considerable distress among Medicaid providers who went without payments for long periods of time. This put significant pressure on the Medicaid provider network and ultimately resulted in some small providers going out of business or dropping Medicaid clients. It appears this budget request is designed to continue to provide supports required because of a problematic IT roll out.

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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.