They aren't about hot-button socials issues, so you might be surprised to learn that the three most-used words at the state Capitol this year may be "hospital provider fee."
Here's why: The fee is the subject of a big fight among lawmakers and the governor, who say it's either a partial savior for schools and roads, or a costly example of government overreach, depending on whom you ask.
I took a look at the fee's origins and the current battle over it, which involves the Taxpayer Bill of Rights. Turns out, the seeds of this fight were planted in 2009, when the state passed the Colorado Health Care Affordability Act.
Edited highlights from my conversation with Colorado Matters host Ryan Warner are below.
How the hospital provider fee got started:
In 2009, lawmakers approved it and the state started collecting the fee from hospitals based on how many patients they see. Democrat Bill Ritter was governor then, and in a recent phone call, he said that many Coloradans at the time lacked health insurance. This was before the Affordable Care Act, or Obamacare, passed, and the state wanted to give them an option.
"Their income level was such that they really weren't able to afford any kind of health insurance and yet they also weren't covered by Medicaid," Ritter said. "And so it was about expanding to pick up coverage both for people with kids and also people with really low incomes and no health care."
Why this fee was the answer:
Ritter and his supporters saw it as a way to expand Medicaid without taking money from other things in Colorado. That was possible because the federal government offered matching money to states that collect these fees -- that federal money gets passed onto hospitals who see Medicaid patients. So while hospitals had to pay a new fee, they benefited in return. Several other states had already assessed similar fees, and more did after Colorado.
In addition to helping more people get health insurance, the fee solved a problem for hospitals. They had seen a lot of patients who couldn't pay for their treatment, or who were on Medicaid, which didn't reimburse the full cost of treatment, according to Steven Summer, who was and still is the head of the Colorado Hospital Association. Summer says the costs of treating those patients were passed onto other patients who had private insurance.
Republicans have argued over the years that hospitals still pass on a little slice of the hospital provider fee to patients in their hospital bills, but it's hard to prove because the legislation that created the fee expressly forbids a line-item on a patient's bill for this fee.
What kind of opposition there was in 2009:
There was some, mostly among Republicans. One who voted against it was Ellen Roberts -- then a state representative and now a state senator from Durango. One of her concerns, and she wasn't alone, was that while Colorado didn't have to take money from its own pockets to do this, taking it from the feds wasn't much better.
"The argument that I heard from some of my colleagues who supported it was that it was free money, that if Colorado didn't take advantage of this free money from the federal government, we would be making a mistake," Roberts said. "And it always struck me as odd that we would ever consider money from Washington, D.C. as free money, because it's all taxpayer money."
Ultimately Roberts lost out and the Colorado Health Care Affordability Act, which created the Hospital Provider Fee, passed with mostly Democratic lawmakers voting for it, though a few Republicans supported it, as well.
Whether it has allowed more people to get health insurance:
Yes, it has. The state was able to expand Medicaid and the Children's Health Insurance Program before the Affordable Care Act passed. Proponents said 100,000 people would get insurance who didn't previously have it. It's hard to say how many actually have, because the ACA expanded Medicaid eligibility even further.
But before it did, at least 23,000 people got health insurance because of this change, according to a spokesman for the Colorado Department of Health Care Policy and Financing. In all, they say more than 400,000 people have gotten insurance under both the Hospital Provider Fee and Obamacare.
However, this opens up a debate about whether putting that many new people on Medicaid is a good thing. I'm not going to get into that now, but health reporter John Daley, has explored this question.
- One In Five Coloradans Now Enrolled In Medicaid
- 10 Things To Know About Medicaid In Colorado
- Study Asserts Positive Impact of Colorado's Medicaid Expansion
- Colorado's Doctors, Rural Providers, Brace For Potential Medicaid Cuts
State Sen. Ellen Roberts says while more people have health insurance, they may not get healthcare.
"Right around the time that we put the hospital fee in place, we were still acknowledging that we didn't have enough health care workers to provide this kind of care. If you don't have the people to provide that health care, all you've done is given people a card to put in their wallet," she said.
Supporters say the fee has had other benefits, like reducing the numbers of patients hospitals see who can't pay anything -- uncompensated care -- and increasing payments for treating Medicaid patients. And they argue that that benefits everyone who uses healthcare.
Why Gov. Hickenlooper wants to reclassify the fee:
The current debate over the hospital provider fee was started by Gov. Hickenlooper last year. He wants to reclassify the fee under state law -- an accounting change, he says -- to make it harder to trigger rebates to Coloradans under the Taxpayer Bill of Rights.
Democrats say the reclassification would free up money to spend on schools and roads, among other things. Opponents say such a maneuver would be unconstitutional, and that it would grow government in violation of TABOR.
On whether the fee should never have been subject to TABOR in the first place:
This is what I was really fascinated to learn. According to Ritter, legislators could have decided back in 2009 to shield it from TABOR, but they didn't -- on purpose.
"There were a lot of people in the legislature willing to vote for the hospital provider fee bill, but worried about taking it out from underneath TABOR -- if that was something that could be used against them in a future campaign, that they were somehow circumventing TABOR," the former governor said. "So we passed the hospital provider fee, did not take it out from underneath TABOR as we could have, because we didn't have the votes for that."
In 2009, the recession was ongoing, and Gov. Ritter said he didn't anticipate the state would reach its TABOR limit, triggering refunds, for a long time. It sounded like that was a far off problem.
On the chances of a bill introduced by Speaker of the House Dickie Lee Hullinghorst to make the change Hickenlooper wants:
Ultimately, the odds aren't great. Republicans -- who control the state Senate -- can prevent it from getting to a floor vote, so even though Democrats believe they have the votes to pass it in the full senate, they may not get the chance. And so far, Republican leadership is against the bill. Some argue the hospital provider fee was illegal from the beginning. They say it was really a tax, which should've required voter approval per TABOR. Although a memo from Colorado's legislative legal council back in 2008 ruled at the time it was not a tax.
Why it's important that the bill has a provision saying that if the federal government stopped reimbursing states for hospital fees, hospitals in Colorado wouldn't have to pay the fees anymore:
This is another wrinkle of the whole thing, and when I talked to Roberts, she explained this was another reason she opposed the Hospital Provider Fee in the first place. Congress could, at any moment, decide to end the match. Remember -- the fee operates on the idea that the cost falls mostly on the feds, not on hospitals. So, hospitals in Colorado are saying, if we're not going to get federal payments anymore, we're no longer going to pay this fee, which allows the state to expand Medicaid. Sen. Roberts worries the state could be left with a lot of new people on public insurance programs without a way to pay for them.
I think the fact that hospitals pushed to have this provision included in the new bill means the fears aren't far fetched. There have been efforts to end the federal matching program. And just a few weeks ago, the Kaiser Family Foundation reported that Congress is currently considering proposals to change it.
What difference would be made in the state budget if Democrats can take the hospital provider fee out from under TABOR:
In future years, it could allow lawmakers to spend more money -- more than $100 million, even -- on roads and schools and other priorities. But it wouldn’t immediately free up that money in the fiscal year that starts in July under the current budget proposal. Still, Gov. Hickenlooper and Speaker of the House Dickie Lee Hullinghorst are pushing hard for this change.
