Colorado lawmakers say they're working on a bill that aims to protect the state's safety net clinics and other facilities — the places that serve those who often can't afford to pay for health care.
Lt. Gov. Dianne Primavera and Democratic lawmakers held a news conference Tuesday to preview the plan.
It would cap health care insurance payments the state makes to hospitals for about 60,000 state workers. The amount saved, perhaps $50 million or more a year, would be reinvested in the state’s community health centers.
“We can save Coloradans money on health care by reining in the highest hospital prices and still protect the safety net providers that Coloradans rely upon,” said Rep. Kyle Brown, a Democrat from Boulder.
A pair of other states, Oregon and Montana, have adopted similar fixes, he said.
Almost a million Coloradans rely on community health centers, and without those centers many wouldn’t be able to get health care at all, said Simon Smith, CEO and President of Clinica Family Health & Wellness, which is based in Lafayette.
A confluence of factors has created tough financial conditions for health care institutions large and small.
At the end of the pandemic’s public health emergency, the federal government required states to return to normal Medicaid eligibility operations. They also had to review eligibility for members enrolled in Health First Colorado (Colorado's Medicaid program) and Child Health Plan Plus (CHP+) within 12 months.
Medicaid Unwind
That process, known as the Medicaid Unwind, has impacted hundreds of thousands of Coloradans, with disenrollment happening on a scale larger than projected or anticipated.
“This means people are losing health insurance coverage,” Smith said. “Safety net providers are losing reimbursement even as the cost of care and inflation make it harder to remain competitive.”
Smith said Clinica’s facilities have seen a drop in Medicaid patients and rise in the number of uninsured patients, noting the last time they saw this many uninsured patients was in the years before Obamacare expanded health coverage more than a decade ago.
“This means thousands and thousands of newly uninsured patients within our organization alone. We've absorbed this impact in a little over a year. It meant terrible choices and large scale cuts to staffing programs and services.”
“We've heard from these essential providers that they're struggling to continue to deliver care that our communities have come to rely on. We can't afford to let these providers close their doors,” said Sen. Iman Jodeh, a Democrat from Aurora. “The impact on our friends and our neighbors, so many of whom don't have the health care options, is too great in Colorado.”
The move comes with the state facing a major budget shortfall.
“We're cutting a billion dollars out of our general fund this year,” said Democratic Sen. Jeff Bridges from Arapahoe County. Many of the state’s federally qualified health centers, many in rural areas, are looking at closing their doors and need a fresh source of funds.
“We have to look around and say what's fair?” he asked. “How do we maintain our responsibility to folks across this state to have high quality, low cost care no matter where you live, no matter what your income is?”
“Colorado's hospital care prices are among the country's highest,” Primavera said. “Now it's time for us to step up to support the safety net.”
A state employee said the bill would help address rising health costs for state workers.
“This bill is a win for state workers, a win for state taxpayers, and a win for all Coloradans who rely on the critical public services the state workers provide,” said David Thurlkill, a state employee at the Colorado Department of Early Childhood.
Unintended consequences?
A representative of Colorado hospitals said the soon-to-be-proposed bill may have the unintended consequence of hurting finances at many hospitals.
Julie Lonborg with the Colorado Hospital Association said 70 percent of the state's hospitals are already operating at unsustainable margins.
“We're working on a considerable list of ideas for them on how the state can save money on health care that doesn't jeopardize hospitals,” she said.
She said she was optimistic that a solution could be found to help federally qualified health centers. But “we are opposed to rate setting, which is really the core of this bill,” Lonborg said.
The Colorado Behavioral Healthcare Council, an association of non-for-profit providers of safety net services for treatment of mental health and substance use disorder treatment, also would like changes to the bill.
“The entire safety net is in jeopardy right now, and the bill takes 80 percent of those realized savings from the reimbursement ceilings for hospitals, directs it to the primary care fund, which is great,” said Edie Sonn, its senior director of external affairs. But, she said, the primary care fund, according to the state’s constitution, only benefits primary care providers. “So others in the safety net that are not primary care providers, don't benefit from it.”
She said they were talking with the various players to adjust that, “so a portion of those realized savings goes to the safety net providers that don't benefit from the primary care fund, including behavioral health providers.”
The new bill will support safety net providers and reduce costs for small businesses, according to a press release, by:
- Establishing reimbursement maximums for in-network (165 percent of what Medicare pays to hospitals) and out-of-network (150 percent of Medicare) on prices paid to certain hospitals through the state employee health plan and the small group market.
- Establishing a floor for primary care and behavioral health services (135 percent of Medicare) through the state employee health plan and small group market.
- A feasibility study to explore the option for local governments and school districts to participate in a similar reimbursement limit.
Brown said he expected the bill to be introduced soon.
