Colorado Gov. Bill Ritter has introduced legislation that would provide health coverage to more than 100,000 uninsured Colorado citizens and families.
The Colorado Healthcare Affordability Act (House Bill 1293) would allow Colorado to leverage state funds to draw down additional federal funds. The proposal is also designed to help stem the rising cost of health insurance for businesses and families by addressing cost-shifting, one of the key drivers of rising costs, without increasing the burden on taxpayers.
"Roughly 800,000 Coloradans, including 180,000 children, currently lack health insurance," Ritter said. "Over the past two years, we've launched a Building Blocks to Healthcare Reform strategy. The Colorado Healthcare Affordability Act gives us an opportunity to continue that progress, and to make major strides at a time when more and more families are struggling just to keep food on the table."
By assessing a provider fee on hospitals, Colorado would generate an additional $600 million a year to provide coverage to the uninsured and receive $600 million in federal matching funds. The combined $1.2 billion would cover more than 100,000 uninsured Coloradans through Medicaid and the Child Health Plan Plus. The funds also would improve hospital reimbursement rates for service provided through Medicaid and the Colorado Indigent Care Program (CICP).
"Annually, Colorado hospitals incur more than $375 million in uncompensated costs by serving Medicaid patients because they receive less than 55 percent of total costs for treating Coloradans in need," said Colorado Hospital Association President and CEO Steven Summer. "We are committed to expanding access to affordable healthcare services for those most at risk."
"This proposal will ... create an opportunity for the state to reform and modernize the way payment rates are set for hospitals, creating a more rational and transparent hospital payment structure," said Sen. Moe Keller (D-Wheat Ridge), chairman of the committee and one of the bill's sponsors.
More than 40 states have implemented this type of strategy for health programs, including more than 20 states that have hospital provider fees. Colorado passed a similar law with nursing home providers in 2008, House Bill 08-1114, which was co-sponsored by then-Rep. Al White (R-Hayden) and Sen. Jim Isgar (D-Hesperus).
"Uninsured patients and Medicaid underpayment to hospitals are two of the primary drivers of cost-shifting in healthcare," said JBC member and bill sponsor Rep. Don Marostica (R-Loveland). "This legislation will allow us to cover a significant portion of the uninsured and reduce the rate of rising healthcare costs all across the state."
The Colorado Hospital Association – which represents 90 hospitals and health systems throughout Colorado – the Department of Health Care Policy and Financing and the governor's office have been working together for more than nine months to develop the proposal. If approved by the Legislature, the plan will be submitted to the federal Centers for Medicare and Medicaid Services (CMS) for final approval.