May 13, 2016

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Legislative Wrap-Up 2016: Health Care

by | May 13, 2016

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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