The Colorado Legislature adjourned its 74th General Assembly on Monday in what lawmakers are describing as a progressive session for healthcare reform.
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The legislature approved appropriations of $15.5 billion ($4.5 billion from general fund) to the Department of Health Care Policy and Financing (HCPF), $2.3 billion ($1 billion from general fund) to the Department of Human Services (CDHS), and $884 million ($126 million from general fund) to the Department of Public Health and Environment (CDPHE) for the FY 2023-2024 state budget, representing a collective 5% and 10% increase for total and general fund appropriations, respectively, from the previous year.
In interviews with State of Reform, lawmakers on key healthcare-related committees offered their thoughts on the main health legislation passed this session—measures ranging from expanding access to reproductive and maternal healthcare to promoting in-demand nursing professions.
The chair of the Senate Health and Human Services Committee, Sen. Rhonda Fields (D – Aurora), described the session as progressive, impactful, and meaningful.
“We’re creating greater access [for] the people of Colorado,” Fields said. “[The committee] had over 96 hours of testimony, and we heard over 45 bills. And so some bills that gathered in committee were successful, and then some did not do so well. But overall when I look at what we’ve done, I’m very, very pleased.”
She said she would continue to look into ways to improve foster care, behavioral health access, and culturally responsive trauma care in the interim.
Medicaid and health equity
Fields sponsored and helped pass Senate Bill 288, which will authorize HCPF to look into ways of promoting the expansion and utilization of doula services for pregnant and postpartum Medicaid recipients. The state will seek federal authorization to provide Medicaid doula benefits and create a scholarship program to support doula training and certification.
She said the measure was significant because it will offer prenatal and postnatal support to new mothers across the state.
The budget outlines an increase of $328.6 million in total funds ($114.2 million from the general fund) for an additional 0.5% across-the-board rate increase for Medicaid providers.
This includes reforming Medicaid reimbursement rates for nursing facility services by incentivizing access to care for Coloradans with complex needs, attaching funding to quality outcomes, and holding nursing facility providers financially accountable by increasing financial transparency.
One of the critical reforms to emerge from the session is SB 222, which eliminates all Medicaid copays with the exception of emergency department services and was signed by Gov. Jared Polis in April. Studies have shown high cost-sharing leads to poor adherence to medication, healthcare utilization, and health outcomes.
The legislature also approved a restructuring of the state’s hospital community benefit system to better reflect the actual need of its communities.
House Bill 1243 requires hospitals to engage the communities they directly serve and submit a public report on how their spending will be administered to meet local health needs, including a summary of their tax exemptions.
HCPF will establish a minimum annual community investment target and community benefit requirements for hospitals to meet aimed at improving community benefit accountability and effectiveness.
Meanwhile, HB 1183 amends the state’s step therapy protocols by requiring HCPF to grant Medicaid prior authorization exceptions for severe and complex medical conditions based on approval from a prescribing provider.
The chair of the House Public and Behavioral Health and Human Services Committee, Rep. Dafna Michaelson Jenet (D – Aurora) told State of Reform about the progress made on mental health.
Michaelson Jenet sponsored a number of bills this session that includes a program to treat the high-acuity behavioral health needs of children in the state’s care and public school-based mental health assessments.
“We know that the depression [and] anxiety rates [for students] are going up and the suicide rate continues to plod along in a pattern that we don’t want to see,” Michaelson Jenet said. “So one of the questions was, ‘How do we get to kids so that they know that they have access to free therapy through the I Matter program?’ One of the ways is through these assessments in schools for students from sixth to 12th grade.
If your school opts into this program and you go through this assessment and screen for therapy, you will be connected to the I Matter program, or [to] your personal insurance or your personal therapist or social worker—whatever [and] whoever you want to be connected to. But the crux of the issue is [that] we do have an answer. We do have a solution—[students] can get therapy and that’s huge.”
Michaelson Jenet’s HB 1269 requires the Behavioral Health Administration (BHA) to submit a report on the number of children in state custody who had extended stays or boarding to CDHS. The report will inform the department’s plan for building health system capacity for high-acuity beds and residential treatment.
Addressing the departure of BHA Commissioner Morgan Medlock, Michaelson Jenet assured the work on behavioral health equity would continue without Medlock’s leadership.
“Unfortunately, I think the outcome was what is best for the Behavioral Health Administration,” Michaelson Jenet said. “There [reportedly] were some leadership tensions that really needed to be ironed out so that the [BHA] can forward and can achieve its goals. Is it a little behind on the timeline? Yes, and we’re finding out it’s a little bit more behind on the timeline than we thought it was. But it will get implemented and services will be received by our community.”
Fields said that while she was saddened by the news, she has received assurances from the administration that it remains committed to pursuing behavioral health equity and that Medlock’s departure would not result in fractures or delays to service.
Another measure to emerge from the session authorizes CDHS to conduct a feasibility study on establishing new pathways to behavioral healthcare. The aim of the study will be to create a structure of support for individuals with serious mental illness through collaboration between the state’s behavioral health and judicial systems.
There were several transparency-related measures that passed, which will regulate some of the practices of hospitals and pharmacy benefit managers.
HB 1215 prohibits providers from charging hospital “facility fees” for certain outpatient (primary care, telehealth, and preventive care) services in non-hospital settings, while HB 1226 requires hospitals to follow industry standards for patient billing, including—at a minimum—a description and details of the services provided, and the charges for each service.
HB 1226 also authorizes HCPF to create and submit an annual report to lawmakers outlining hospital expenditures statewide.
The bill sponsor, Rep. Matt Soper (R – Delta), told State of Reform that the report will help lawmakers determine if the state is being overcharged by hospital systems to subsidize healthcare in other states.
“Part of the transparency is to require disclosure when hospitals are moving cash out of Colorado to another state,” Soper said. “I think that’s fair to ask. Also, we added an amendment to have the reverse asked—so if a hospital in Colorado is part of a system and they receive cash from outside the Colorado community, we could see that as well.
So we may have a hypothesis as far as lawmakers, but this gives us tools to be able to see what’s going on in our healthcare system. We also have a provision that asks for quarterly financial statements unaudited from hospitals. And this is because we have a number of our rural hospitals on the brink of failure.”
Soper said in order to support state efforts against healthcare consolidation, lawmakers need access to good data to understand where policy and financial support can be directed to assist struggling providers.
Soper sponsored a measure prohibiting spread pricing by PBMs, ensuring that the amount charged for a prescription drug to consumers is equal to or less than the amount paid by the PBM or health plan to the contracted pharmacy for the drug.
Additionally, HB 1227 prohibits PBMs from engaging in a number of anti-competitive and pricing practices, such as requiring patients to obtain their prescriptions through mail order, charging pharmacies fees to adjudicate claims, and requiring pharmacies to obtain accreditations or certifications unnecessarily.
Lawmakers pushed through some legislation to build upon existing healthcare affordability reforms such as the Colorado Option and Prescription Drug Affordability Board (PDAB).
HB 1225 extends the sunset date for PDAB and expands the number of drugs it can establish upper payment limits on for next year.
HB 1224 allows the Division of Insurance (DOI) to limit carriers’ ability to claim excessive profit and administrative expenses as part of its rate setting for the Colorado Option.
DOI will also be able to utilize local data rather than national averages for determining the cost price index, a medical inflationary gauge that DOI says will more accurately incorporate rising costs into its rate setting.
Critics attribute the state’s failure to meet rate reduction targets for the Colorado Option to the DOI’s methodology, which they say did not adequately account for medical inflation.
Democratic lawmakers failed to pass a third attempt to conduct a study of a statewide publicly financed or universal healthcare system with direct compensation to providers.
Sharing his thoughts on the session with State of Reform, Sen. Jim Smallwood (R – Castle Rock) said he believes the Colorado Option has failed to keep its promises of lower prices, more coverage options, and improved health outcomes during the interim.
Smallwood said he would continue to educate Coloradans on what he sees as the failures of the Colorado Option and oppose measures around the creation of a single-payer system in the interim.
“[Democrats are] continuing to push [the Colorado Option] forward. They’re continuing to push messaging around that,” Smallwood said. “But I think folks that live in the health policy space can pretty much see through what’s being done, which is [that] Colorado wants to be the first single-payer state in the union, in my opinion, and that’s the driving force of the legislation we’re seeing from the [Democratic] party.
On the positive side though, there have been several bills that continue to actually work to solve increased healthcare and health insurance costs in our state. And it’s around transparency—providing more information to the consumers, [and] more information to employers who purchase these plans for their employees. So reasonable steps forward [are] to try to continue to work on costs, particularly in the hospitalization and prescription drug areas.”