Template2020-05-13T11:45:26-06:00

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Highlights of the Week

 

cid:image010.png@01D5F461.E931FCB0On Thursday this week, a bill to implement a public option for health insurance was introduced.  The bill was long expected after a final report on the public option was released in late 2019 by the Department of Health Care Policy and Financing (HCPF) and the Division of Insurance (DOI).   As expected, HB 20-1349 contains much of the proposal from the executive branch agencies with a few differences. The bill requires health insurance companies to offer a plan, the details of which are either spelled out in the bill or would be set through regulations.  It also requires hospitals to accept prices for services, set at a base benchmark of 155% of Medicare, with boosts in that rate for critical access hospitals and hospitals that serve a high percentage of Medicaid and Medicare patients.  The plan would initially be offered only to Coloradans who purchase insurance on the individual market, but the bill leaves it open to expand the option to the small group market in the future.  If hospitals don’t participate and accept the prices offered by the plan, they could be fined up to $10,000 per day after receiving a warning. This bill will receive a lot of attention under the gold dome in the second half of the legislative session.  Insurance premiums tend to be higher in rural parts of the state and two rural mountain legislators, Representative Robert and Senator Donovan are sponsoring the bill.  The bill’s third sponsor is House Assistant Majority Leader Chris Kennedy. 

 

Advocates for changing the Taxpayer Bill of Rights (TABOR) moved forward this week with ballot initiative #271 to implement a graduated income tax.  On Wednesday, its title received approval from the Title Board, which is charged with reviewing ballot titles to ensure that they meet the single subject requirement.  A group called Vision 2020 has submitted dozens of ballot initiatives that would change the Taxpayer Bill of Rights.  The initiatives submitted had three general strategies: repeal TABOR, repeal and replace TABOR with less stringent voter approval requirements or remove the flat income tax and replace it with a graduated income tax to increase state revenue.  One of the lesser known parts of TABOR is a requirement that the state levy a flat income tax rate.  This week the advocates narrowed down their strategy to one of the graduated income tax proposal, which would lower the state income tax rate for most households, and set higher income tax rates for higher earners. The initiative would set up the following tax rates and brackets:

 

Income

Tax Rate

Under $250,000

4.58%

$250,000-$500,000

7%

$500,000-$1 million

7.75%

Above $1 million

8.9%

 

 

 

 

 

 

 

Most taxpayers fall in the first tax bracket, and these individuals would see a tax rate reduction from the current rate of 4.63%.  Proponents see this feature as one of the strengths of the measure.  New revenue under the measure would be split with at least half going to P-12 public education and the remainder dedicated “to address the impacts of a growing population and changing economy”.  The initiative would also create a 25 member commission charged with evaluating the effects of a new tax system. There are still a number of hurdles to pass before the initiative is placed on the ballot.  The petition form still needs to be approved and then proponents will need to gather more than 120,000 valid signatures and have them approved by the Secretary of State. 

 

This week,  HB 1319, which bans the sale of flavored nicotine products, was heard in House Health and Insurance committee with over 6 hours of testimony.  The bill’s supporters included advocacy groups, doctors, and youth talking about the harmful effects tobacco and vaping has had on public health and social situations related to children.  They also talked about the marketing practices of tobacco companies and e-cigarette companies such as Juul.  The opponents consisted of citizens who argued about personal freedoms and retailers, including vape shop owners, who contend that this bill will put them out of business. The sponsors requested that bill be laid over for action to a later date as they try and figure out how to address the bill’s $30 million fiscal note.  The price tag is due to a decline in expected tax revenue because of less sales of these nicotine products.  

 

HB20-1287, Colorado Rights Act, failed in the House Judiciary Committee Thursday after a lengthy hearing and procedural disagreements.  Representative Weissman, chair of the Committee, blocked a motion made in the beginning of the hearing by the bill’s sponsor Representative Soper, to postpone indefinitely HB20-1287.  Typically, when such a motion is made, the chair and committee members go along with the bill sponsor’s request. There are a number of reasons a bill sponsor would vote against his bill, chief among them is that the sponsor does not think that the bill is ready.  This tussle over rules and convention ultimately led to the bill hearing proceeding normally with witnesses testifying on the bill.  HB20-1287 proposed to increase the ability of individuals to bring lawsuits when their constitutional rights are violated.  It would remove governments ability to use qualified immunity, a defense that their actions didn’t violate rights that a reasonable public official can be expected to know, as a defense in court.  Some raised concerns that the bill would have opened up liability for local governments.  The bill ultimately died on a 4-5 vote. 

 

Saturday March 7 is the halfway point in the legislative session.  In the final 60 days, significant legislation is expected to be introduced.  Here are a few issues yet to come: 

 

  • A bill to strengthen Colorado’s anti-discrimination statutes for groups not already covered by the Colorado Civil Rights Commission included independent contractors, interns and volunteers.
  • Metro Districts Transparency—Giving home-owners more understanding and involvement. 
  • Medical Liens, similar to SB20-217 , which died in the final moments of the 2019 session 
  • Transportation Funding—Several ideas are still on the table for 2020, including General Fund commitment, Road Usage fees, Gas Tax and Regional Transportation Taxing Authorities. 
  • A bill to increase data privacy protections
  • FAMLI, which picked up two new co-sponsors with the addition of Senator Moreno and Representative Caraveo. 

Budget Items:

 

This week the Joint Budget Committee held figure setting hearings for two large executive branch agencies, the Department of Education and the Department of Health Care Policy and Financing.   Some of the big-ticket items in the Department of Education, including the requests for K-12 total program funding, will have to wait until after the March Revenue Forecast.  The JBC did approve a $2 million increase for the Charter School Institute (CSI) mill levy override.  CSI schools do not receive mill levy overrides because they are authorized by CSI and not a district, so the state provides some level of funding to equalize the funding CSI schools receive compared to schools near them.   For context, the complete equalization of override revenues for CSI schools would require $33.9 million General Fund. The JBC also approved the Governor’s request for a $1 million onetime increase to the Concurrent Enrollment Expansion and Innovation Grant Program which provides grants to assist schools and school districts in offering concurrent enrollment opportunities by initiating or strengthening partnerships with institutions of higher education. The JBC also approved $1 million in ongoing funding to expand the Career Development Success Program which provides incentives for the participating school districts and charter schools to encourage high school students to complete a qualified workforce program.

 

The JBC denied a number of requests that require separate legislation because the Long Bill, the state’s budget bill, is required to be set to current law.  Requests that were denied include a request for a concurrent enrollment pilot program for future educators, funding to support educator evaluations and a request for grants to improve early childhood education facilities.  The JBC also denied a request to add $4 million for the School Transformation Grant Program and expand eligibility for the grants because it would have required additional legislation, although the JBC did approve ongoing continuation of $1 million in funding for this program.  Expect to see the Department come back with more information on this request later in March. One of the Governor’s top priorities this session has been to expand access to preschool for Coloradans and the R6 request for $27 million General Fund would add 6,500 slots to the Colorado Preschool Program.  The Joint Budget Committee decided to delay making a decision on this issue until after the March revenue forecast.  

 

During the Health Care Policy and Financing figure setting hearing, the Joint Budget Committee made decisions related to the state’s Medicaid system.  The February forecast for Medicaid enrollment and expenditures resulted in a higher estimate of expenditures than the previous forecast.  The difference for both FY2019-20 and FY2020-21 is $10.3 million higher than the November 1 budget submission.  This most recent forecast continued the trend of lower enrollment, but higher per capita costs for Medicaid.  The JBC approved a Governor request R7a to implement a new methodology of rate setting what Colorado’s Medicaid program will pay for new drugs.  Currently HCPF reimburses at a rate determined to be the average price, with the goal of reimbursing pharmacies at cost.  But it takes time to develop a survey for this average acquisition cost, so the proposal is to set a maximum cost that Medicaid would pay for a prescription drug until a survey determines the average price.  Several provider rate changes were approved by the JBC including a 2.75% increase for personal care and homemaker rates; 6.4% increase for alternative care facilities; 19% increase for adult day programs, balancing behavioral health fee for service rates to between 80-100% of the benchmark; adding evaluation costs for family planning; adding reimbursements for some procedures at ambulatory surgical centers; and aligning billing practices for dialysis to Medicare.

 

 

cid:image014.png@01D5F461.E931FCB0Bills of the Week

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