With just 13 days to go in the 2016 legislative session, the House today held its long-awaited debate on whether to reclassify a billion-dollar hospital program into a standalone enterprise to free up more money in the state budget.
The House approved, on a voice vote, a proposal to change the state’s hospital provider fee into such an enterprise as allowed by the Taxpayer’s Bill of Rights. Enterprises are government-owned businesses, like a concession stand at a park or the state lottery, that can only take in 10 percent of government funds to operate, among other provisions.
The hospital provider fee is a state program requiring hospitals to pay money each year depending on how many patients stayed in hospital beds overnight and how many outpatient services they provided. That money is then used, among other things, to help Coloradans who can’t afford insurance plans get care, and to help the state pay for people who are on Medicaid, a government healthcare program for low-income Coloradans and their families.
The program brought in some $750 million last year alone.
The funds currently fall under revenue limits governed by TABOR. That’s become an issue for Democrats, because those dollars are now exceeding revenue limits. Those surplus dollars will likely go back to taxpayers in the form of individual refunds, possibly as soon as next year.
Reclassifying the fee as an enterprise is at the heart of HB 1420, one of the most controversial measures this session, and if it’s approved, money the program brings in would not count against the TABOR revenue limit.
Bottom line: Less money refunded to individual taxpayers, but more money left in the state’s general fund that can be used to fund key programs like transportation, education, and infrastructure.
Initially, Democratic Speaker of the House Dickey Lee Hullinghorst, a champion of the proposal, intended that her bill run concurrently with the state’s budget bill. But she abandoned that idea almost immediately once her hospital provider fee bill cleared the House Appropriations Committee on March 29.
Hullinghorst had personally spoken in the bill’s favor in that committee hearing, followed by several special interests groups representing schools, hospitals, business groups, and others. No one spoke out against it.
But since late March the legislation had been in a holding pattern for debate in the full House. Until today. Thursday’s debate on the House floor was almost anticlimactic. Rhetorical wrangling lasted less than two hours, although Democrats worried Republicans might drag it out through a filibuster.
That did not happen.
House Minority Leader Brian DelGrosso, a Loveland Republican, led the debate for his caucus in opposition to the bill. He told House members that in 2009 Democrats argued against classifying the fee as an enterprise.
DelGrosso suggested the proposal could be changed so voters could weigh in on the issue.
“I’m tired of revenue coming in and not being spent on priorities,” he said.
Republicans also claimed the bill was an attempt to skirt the spirit of TABOR.
Democrats killed one amendment that would have directed all of the surplus revenue toward transportation, on a largely party-line vote.
But all-in-all the bill did pick up two Republicans: Reps. J. Paul Brown of Ignacio and Dan Thurlow of Grand Junction. On another procedural vote at the end of the morning session, nine Republicans voted to approve the measure and an accompanying bill that would dictate how the dollars would be spent if the first bill were to pass. The vote was 43 in favor, 22 against.
That procedural vote could signal that there might be more than two Republicans willing to back this change in the hospital provider fee on its final House vote, which takes place Friday.
Andres Moreno, Creative Commons, Flickr.