Republicans walk a tightrope over rural hospital fix

As lawmakers continue to negotiate over the session’s biggest bill – to free up millions of dollars for rural hospitals, instead of cutting funds to the brink of closure – Republican lawmakers are walking a tightrope between rural hospitals and schools on one side, and conservatives, including outside groups, that would like to see the measure killed.

Conservatives have long opposed any change in the hospital provider fee, a program that requires hospitals to pay a fee based on overnight patient stays and the number of outpatient services. That money is pooled and then matched on almost a dollar-for-dollar basis, and then redistributed to hospitals that provide health care to low-income Coloradans.

The provider fee bill, under the title of “Sustainability for Rural Colorado,” includes a long list of different proposals that would fund rural hospitals, schools and transportation projects for rural communities.

It also includes a reduction in the state’s spending limit by $670.3 million, a nod to conservatives who won’t support the bill without it. And that matters: the bill’s Republican sponsors are Senate President Pro Tem Jerry Sonnenberg of Sterling and Rep. Jon Becker of Fort Morgan, both fiscal conservatives.

Sonnenberg and Becker put their names on the bill to save rural hospitals; Sonnenberg has 11 in his 11-county district. Two could face closure without a fix to the provider fee program. That fix comes in the form of reclassifying the fee into a government-owned business. That would take the provider fee money out of the state’s spending limit and save hospitals statewide from a $528 million cut.

The spending limit is set by the Taxpayer’s Bill of Rights (TABOR), which allows state spending to increase by a percentage based on population growth and inflation. That’s usually around 6 percent every year. Any attempts to weaken or change TABOR will earn a lawmaker the wrath of TABOR defenders, both inside and outside the Capitol. That’s one of the reasons Republicans in the past two years, including then-Senate President Bill Cadman of Colorado Springs, refused to consider any changes to the provider fee program, believing the fix proposed by Democrats would violate TABOR.

Republicans who have changed course and decided to back the provider fee fix are finding themselves in the crosshairs from groups outside the Capitol, several from within their own party, that oppose the measure, no matter how much it could be tweaked to their liking. And several sources who would speak only on background have said that pressure includes threatening some Republican lawmakers with primaries next year.

Part of the issue, according to Sonnenberg, is that it’s tough to get urban lawmakers, including those within his own caucus, to understand the problems of rural Colorado.

That job is tougher when urban lawmakers rely on outside conservative organizations to evaluate complicated bills, he said, such as the provider fee bill. Even those groups that have rated Sonnenberg highly in the past, such as Principles of Liberty (which rates Colorado lawmakers on adherence to principles of free markets and liberty) and the Colorado Union of Taxpayers, an anti-tax group, are on record on whether the bill matches up with their ideals. It doesn’t.

At least one rural lawmaker is unperturbed about any fight with conservative organizations over the bill. Sen. Don Coram of Montrose, one of several rural Republican senators expected to back the bill, said people in his district who are aware of it are supportive. “I’m hearing from the people who are concerned about the health of our hospitals,” he said Tuesday. To the groups that are fighting the bill, Coram said that when he gets a bad score from them, “I know I’m on the right side because I represent rural Colorado.”

Sen. Owen Hill, one of two urban Republicans on the Senate Finance Committee who voted to move the bill forward, acknowledged the pressure within his own district in Colorado Springs. He’s regularly spending time with voters in town halls explaining the policy behind the bill, and said that people are fine with it once they understand what it does. He tells his voters that “this is not a way for the state to spend any more money. It’s a way to keep the state out of the hospitals’ budgets,” and with the spending limitation, which is allowed under the state constitution, “it’s the fiscally conservative thing to do.” Sen. Jack Tate of Centennial said he had not heard from some of the outside groups but added, “it’s early.”

Senate President Kevin Grantham of Cañon City was not available for comment.

Greg Golyanski, who heads the Colorado Union of Taxpayers, said Tuesday that the provider fee is just a tax by another name. “Taxes have to be approved by voters,” Golyanski said. There’s also the matter of the bill’s title – Sustainability of Rural Colorado – a title so broad that almost anything could fit in it. Golyanski said he believes the bill violates Colorado’s single-subject law, which requires legislation to address only one issue. “It’s a hodge-podge of shenanigans,” he said, and indicated his organization might mount a legal challenge were the bill to become law.

Principles of Liberty head Richard Bratten said the organizations does not take positions on bills, but rates them based on how those measures match up with their views. However, the organization’s website says it opposes the provider fee bill, along with a lengthy analysis that said the measure conflicts with their views on fiscal responsibility and limited government. “This bill is not for the faint of heart,” the website analysis said.

The bill also has earned the wrath of the libertarian Independence Institute. Their online publication Complete Colorado came out with a stinging rebuke last week, saying the bill would “make the state budget less transparent, reduce legislative and taxpayer control over state spending, create two new slush funds outside of legislative control, increase state indebtedness, and use a financial trick to raise the amount of tax money the state can keep without voter approval.”

But surprisingly, that opposition is not coming from one of the state Capitol’s most ardent TABOR defenders – the Koch brothers-funded Americans for Prosperity – which has asked lawmakers in the past to sign pledges to defend TABOR. Michael Fields, AFP Colorado’s state director, said this week that they aren’t opposing or supporting the bill.

It’s more a position of neutrality for now, Fields said. “We’re waiting to see what happens,” especially with ongoing conversations about the spending cap. Fields was among several, including state GOP spokesman Kyle Kohli, who complimented Sonnenberg on his handling of the bill during its Senate Finance Committee hearing last week.

The bill is currently awaiting its next hearing with the Senate Appropriations Committee. The 2017 legislative session ends three weeks from Wednesday.


Photo credit Nick M Clayton, via creative commons license, Flickr