The Hospital Provider Fee was created by an act of the Colorado Legislature in 2009 to help provide health care to those who can’t afford their own medical coverage and were not already qualified for Medicaid.
It is assessed on hospitals based on the number of patients they have, and is used to offset the cost of Medicaid programs, meaning some of the money is returned to the hospitals based on statewide provider rates.
The Legislature uses the fee to maximize how much it gets from the federal government to comply with the federal Affordable Care Act.
Since it was enacted, more than 300,000 Coloradans who couldn’t afford health care now have coverage either through Medicaid or the state’s Child Health Plan Plus.
Under the Taxpayer’s Bill of Rights, state revenues from virtually all sources, taxes and fees are limited year over year depending on population and inflation. But some revenues can be exempt from those limits if they are used for a specific purpose and get less then 10 percent of their revenues from tax dollars. Most universities, for example, are considered standalone enterprises, something TABOR allows, and aren’t subject to its revenue limits.
The proposal to take the provider fee out from under TABOR would work just like that. It would make the Hospital Provider Fee Fund its own enterprise, which would have the effect of taking that money — about $535 million last year, and $688 million this year — out from under the TABOR revenue cap, freeing up an equal amount of money to be used for other services, such as transportation and education.
But lowering that amount also would cut into any TABOR refunds, which are projected to be about $352 million by the 2017-18 fiscal year.
Source: Colorado Department of Health Care Policy & Financing and the Colorado Hospital Association