Republican Attorney General Cynthia Coffman announced Monday that reclassifying the state’s hospital provider fee as an enterprise meets constitutional muster, restarting conversations among lawmakers about a bill that would transform Colorado’s 2016-17 budget and the state’s economy.
And those conversations are moving quickly, at least among Democrats.
This morning, Speaker of the House Dickey Lee Hullinghorst, a Gunbarrel Democrat, told reporters she will introduce a hospital provider fee bill on March 18. That’s the same day state economists release revenue projections that will give budget writers final numbers to use in the 2016-17 budget.
The hospital provider fee reclassification has been the 2016 session’s biggest fight between lawmakers of both parties.
The hospital provider fee works like this: Colorado hospitals pay a fee to the state, based on how many patients stay overnight. That money is matched with federal dollars and then redistributed to hospitals that provide care to the uninsured or to pay for Medicaid costs. Currently, the fee is marked as state revenue, and those dollars push state revenues over limits set by the Taxpayer’s Bill of Rights, triggering refunds. Recategorizing the fee as an enterprise would free up as much as $700 million over five years that could pay for education and road and bridge projects. But that change also would mean an end, at least for now, to taxpayer refunds slated to begin with the 2016-17 budget.
The budget bill is slated for release on March 28, just ten days after the introduction of the hospital provider fee bill. The Joint Budget Committee, which writes the state budget, must base it on current state law, which means they can’t include whatever funds could be available, should the provider fee bill pass. And that’s a big “if”, according to JBC Vice-Chair Sen. Kent Lambert, a Colorado Springs Republican, who says changing the fee to an enterprise isn’t legal under the state constitution.
Senate Republicans are relying on an opinion from the General Assembly’s lawyers that said the switch isn’t legal. Democrats, including Hullinghorst, are relying on a set of opinions from Coffman, former Attorney General John Suthers and attorneys for two former governors that said it would be legal.
Hullinghorst plans to push the provider fee bill, even though Senate Republicans, including Senate President Bill Cadman, haven’t changed their position. She said this morning that she hopes to reach an “accommodation” with Cadman by the time the bill is introduced, although she said they haven’t discussed the issue in weeks.
It isn’t too late to put the provider fee funds into the 2016-17 budget if the bill were to pass, she said.
Henry Sobanet, the governor’s budget man, agrees. The budget isn’t final until May 11, when the session ends, Sobanet said. Democrats could amend the budget to work in the provider fee dollars if the law changes between March 18 and the date the budget receives final approval.
But that’s a short window. If the budget bill is introduced as expected on March 28, it could be finalized in three weeks.
Technically, a bill can fly through both the House and Senate in three days. Disputed bills, like the hospital provider fee measure, can take months.
Winning Republican support from reclassifying the hospital provider fee won’t be easy. Democrats plan to lure Republicans over to their side by promising transportation funding.
Senate Republicans last year sought a bill to put $3.5 billion into road and bridge projects around the state. The bill would have asked taxpayers to approve bonds to pay for the projects. But House Democrats killed the bill.
Wanting to advance the provider fee bill, Democrats including Gov. John Hickenlooper are rethinking their position on transportation bonds and now favor using some of the revenue that could be freed up by the provider fee change to pay for billions needed to fund Republican supported transportation projects.
“It’s time to address this problem,” Hullinghorst said this morning. “There aren’t any other solutions to the budget.”
Photo credit: Chris Potter, Creative Commons, Flickr.