House Bill 25-1213 Revised

A Bill for an Act

• Page 1, Line 101Concerning changes to the medical assistance program.

Bill Summary

(Note: This summary applies to this bill as introduced and does not reflect any amendments that may be subsequently adopted. If this bill passes third reading in the house of introduction, a bill summary that applies to the reengrossed version of this bill will be available at http://leg.colorado.gov.)

The bill exempts an assisted living residence with fewer than 19 beds that has not undergone new construction or renovations and that complies with the standards for assisted living residences from complying with facility guidelines adopted by the state board of health.

The bill requires the department of health care policy and financing (state department) to follow the standards set by the federal centers for medicare and medicaid when updating rules.

The state department must establish a process for reviewing and updating the general billing manual on an annual basis and ensure that the general billing manual includes all necessary CPT codes.

Beginning January 1, 2026, for claims that must be reprocessed as a result of updating the provider rates, the bill requires a managed care organization to issue payment to a contracted provider within one year after the provider rate is updated.

The bill requires the state department to include in each new contract with, or renewal of a contract with, a managed care entity (MCE) a provision requiring the MCE to submit to the state department, on an annual basis, the amount the MCE is paid and the MCE's medical loss ratio. The state department is required to publish this information on the state department's website on an annual basis.

The bill prohibits the state department from imposing signature requirements on a physician or practitioner certifying a medicaid member's (member) plan of care that involves physical therapy or occupational therapy.

The bill prevents a member receiving home- and community-based services from losing the services the member currently receives if the member's disability and need for services have not changed in the preceding 3 years.

• Page 2, Line 1Be it enacted by the General Assembly of the State of Colorado:

• Page 2, Line 2SECTION 1.  In Colorado Revised Statutes, 10-16-1203, amend (12)(c) as follows:

• Page 2, Line 310-16-1203.  Definitions. As used in this part 12, unless the context otherwise requires:

• Page 2, Line 4(12)  "Qualified individual" means an individual, regardless of immigration status, who:

• Page 2, Line 5(c)  Is not eligible for the premium tax credit, medicaid, medicare,

• Page 2, Line 6or the children's basic health plan, except for individuals eligible pursuant to section 25.5-5-201 (6) or section 25.5-8-109 (7).

• Page 2, Line 7SECTION 2.  In Colorado Revised Statutes, 25-27-104, add (3) as follows:

• Page 2, Line 825-27-104.  Minimum standards for assisted living residences

• Page 2, Line 9- rules - definition. (3) (a)  Rules adopted by the state board

• Page 3, Line 1pursuant to subsection (1) of this section must exempt an

• Page 3, Line 2assisted living residencefrom complying with the facility

• Page 3, Line 3guideline institute (FGI) guidelines, except in the case of new

• Page 3, Line 4construction or major renovations. An assisted living residence

• Page 3, Line 5must still comply with all other fire and local building codes and the standards outlined in this section.

• Page 3, Line 6(b)  For purposes of subsection (3)(a) of this section, "major

• Page 3, Line 7renovations" means additions to a building's structure or

• Page 3, Line 8changes that affect the structural integrity of the building.

• Page 3, Line 9Major renovations do not include changing the functional

• Page 3, Line 10operation of a space if no construction is completed and the

• Page 3, Line 11floor plan of the building remains the same. It also does not

• Page 3, Line 12include adding beds to accommodate more residents or upgrades

• Page 3, Line 13to the heating or cooling systems and electrical systems if those improvements do not require construction.

• Page 3, Line 14SECTION 3.  In Colorado Revised Statutes, add 25.5-1-135 as follows:

• Page 3, Line 1525.5-1-135.  Billing manual.Using existing resources

• Page 3, Line 16allocated for billing manual reviews, the state department

• Page 3, Line 17shall establish a process to review and update the general

• Page 3, Line 18billing manual on an annual basis, which must ensure that the

• Page 3, Line 19general billing manual includes all necessary CPT codes, or provides links to the state department's list of CPT codes.

• Page 3, Line 21SECTION 4.  In Colorado Revised Statutes, 25.5-4-402.4, amend

• Page 3, Line 22(2)(f), (3)(d)(I), (3)(d)(V),(4)(b) introductory portion, (4)(b)(II), (5)(a),

• Page 3, Line 23(5)(b)(VI)(B), (6)(a)(I), (6)(b)(II), and (6)(c); amend as they will

• Page 4, Line 1become effective July 1, 2025, (4)(a) introductory portion and (5)(b)(VI)(D); and add (2)(f.5), (5)(b)(I.5), and (9) as follows:

• Page 4, Line 225.5-4-402.4.  Hospitals - healthcare affordability and

• Page 4, Line 3sustainability fee - receipt of public funds - Colorado healthcare

• Page 4, Line 4affordability and sustainability enterprise - federal waiver - fund

• Page 4, Line 5created - reports - rules - legislative declaration - repeal.

• Page 4, Line 6(2)  Legislative declaration. The general assembly hereby finds and declares that:

• Page 4, Line 7(f)  Consistent with the determination of the Colorado supreme

• Page 4, Line 8court in Nicholl v. E-470 Public Highway Authority, 896 P.2d 859 (Colo.

• Page 4, Line 91995), that the power to impose taxes is inconsistent with enterprise status

• Page 4, Line 10under section 20 of article X of the state constitution, it is the conclusion

• Page 4, Line 11of the general assembly that the healthcare affordability and sustainability

• Page 4, Line 12fee charged and collected by the Colorado healthcare affordability and

• Page 4, Line 13sustainability enterprise is a fee, not a tax, because the fee is imposed for

• Page 4, Line 14the specific purposes of allowing the enterprise to defray the costs of

• Page 4, Line 15providing the business services specified in subsections (2)(d)(I) and

• Page 4, Line 16(2)(d)(II) of this section to hospitals that pay the fee and is collected at

• Page 4, Line 17rates that are reasonably calculated based on the benefits received by those hospitals; and

• Page 4, Line 18(f.5)  Transfers from governmental health-care providers

• Page 4, Line 19to the enterprise through a mutually executed agreement, and

• Page 4, Line 20as authorized by 42 CFR 433.51, are not "grants" under section 20 of article X of the state constitution because:

• Page 4, Line 21(I)  Participating providers receive federal funds and other business services as described in this section; and

• Page 4, Line 22(II)  Such transfers must be repaid if they are not utilized

• Page 5, Line 1or approved, and thus do not meet the definition of "grant" set forth in section 24-77-102; and

• Page 5, Line 2(3)  Colorado healthcare affordability and sustainability enterprise. (d)  The enterprise's primary powers and duties are:

• Page 5, Line 3(I)  To charge and collect the healthcare affordability and

• Page 5, Line 4sustainability fee as specified and receive public funds as described in subsection (4) of this section;

• Page 5, Line 5(V)  To enter into agreements with the state department to the

• Page 5, Line 6extent necessary to collect and expend money from the healthcare affordability and sustainability fee revenue cash fund;

• Page 5, Line 7(4)  Healthcare affordability and sustainability fee. (a)  For the

• Page 5, Line 8fiscal year commencing July 1, 2017, and for each fiscal year thereafter,

• Page 5, Line 9the enterprise is authorized to charge and collect a healthcare affordability

• Page 5, Line 10and sustainability fee, as described in 42 CFR 433.68 (b), or as

• Page 5, Line 11otherwise in compliance with 42 CFR 433, on outpatient and inpatient

• Page 5, Line 12services provided by all licensed or certified hospitals, referred to in this

• Page 5, Line 13section as "hospitals", and receive public funds as described in 42

• Page 5, Line 14CFR 433.51, for the purpose of obtaining federal financial participation

• Page 5, Line 15under the state medical assistance program as described in this article 4

• Page 5, Line 16and articles 5 and 6 of this title 25.5, referred to in this section as the

• Page 5, Line 17"state medical assistance program", including disproportionate share

• Page 5, Line 18hospital payments pursuant to 42 U.S.C. sec. 1396r-4. If the amount of

• Page 5, Line 19healthcare affordability and sustainability fee revenue collected exceeds

• Page 5, Line 20the federal net patient revenue-based limit on the amount of such fee

• Page 5, Line 21revenue that may be collected, requiring repayment to the federal

• Page 5, Line 22government of excess federal matching money received, hospitals that

• Page 5, Line 23received such excess federal matching money are responsible for repaying

• Page 6, Line 1the excess federal money and any associated federal penalties to the

• Page 6, Line 2federal government. The enterprise shall use the healthcare affordability and sustainability fee revenue to:

• Page 6, Line 3(b)  The enterprise shall recommend for approval and

• Page 6, Line 4establishment by the state board the amount of the healthcare affordability

• Page 6, Line 5and sustainability fee that it intends to charge and collect and the

• Page 6, Line 6amount of public funds that it intends to receive. The state board

• Page 6, Line 7must establish the final amount of the fee by rules promulgated in

• Page 6, Line 8accordance with article 4 of title 24. The state board shall not establish

• Page 6, Line 9any amount that exceeds the federal limit for such fees or public funds.

• Page 6, Line 10The state board may deviate from the recommendations of the enterprise,

• Page 6, Line 11but shall express in writing the reasons for any deviations. In establishing

• Page 6, Line 12the amount of the fee and in promulgating the rules governing the fee, the state board shall:

• Page 6, Line 13(II)  Establish the amount of the healthcare affordability and

• Page 6, Line 14sustainability fee and public funds so that the amount collected from the

• Page 6, Line 15fee, the amount received from public funds, and federal matching

• Page 6, Line 16funds associated with the fee and public funds are sufficient to pay for

• Page 6, Line 17the items described in subsection (4)(a) of this section, but nothing in this

• Page 6, Line 18subsection (4)(b)(II) requires the state board to increase the healthcare

• Page 6, Line 19affordability and sustainability fee or the amount of public

• Page 6, Line 20funds to be received above the amount amounts recommended by the enterprise; and

• Page 6, Line 21(5)  Healthcare affordability and sustainability fee cash fund.

• Page 6, Line 22(a)  Any healthcare affordability and sustainability fee collected or

• Page 6, Line 23public funds received pursuant to this section by the enterprise must be

• Page 6, Line 24transmitted to the state treasurer, who shall credit the fee or public

• Page 7, Line 1funds to the healthcare affordability and sustainability fee cash fund,

• Page 7, Line 2which fund is hereby created and referred to in this section as the "fund".

• Page 7, Line 3The state treasurer shall credit all interest and income derived from the

• Page 7, Line 4deposit and investment of money in the fund to the fund. The state

• Page 7, Line 5treasurer shall invest any money in the fund not expended for the

• Page 7, Line 6purposes specified in subsection (5)(b) of this section as provided by law.

• Page 7, Line 7Money in the fund shall not be transferred to any other fund and shall not

• Page 7, Line 8be used for any purpose other than the purposes specified in this subsection (5) and in subsection (4) of this section.

• Page 7, Line 9(b)  All money in the fund is subject to federal matching as

• Page 7, Line 10authorized under federal law and, subject to annual appropriation by the

• Page 7, Line 11general assembly, shall be expended by the enterprise for the following purposes:

• Page 7, Line 12(I.5)  To maximize the inpatient and outpatient hospital reimbursements, as permitted in 42 CFR 438.6(c);

• Page 7, Line 13(VI)  To pay the enterprise's actual administrative costs of

• Page 7, Line 14implementing and administering this section, including but not limited to the following costs:

• Page 7, Line 15(B)  The enterprise's actual costs related to implementing and

• Page 7, Line 16maintaining the healthcare affordability and sustainability fee and

• Page 7, Line 17receipt of public funds, including personal services, operating, and consulting expenses;

• Page 7, Line 18(D)  The enterprise's personal services and operating costs related

• Page 7, Line 19to personnel, consulting services, and for review of hospital costs

• Page 7, Line 20necessary to implement and administer the increases in inpatient and

• Page 7, Line 21outpatient hospital payments made pursuant to subsection (5)(b)(I)

• Page 7, Line 22subsections (5)(b)(I) and (5)(b)(I.5) of this section, disproportionate

• Page 8, Line 1share hospital payments made pursuant to subsection (5)(b)(II) of this

• Page 8, Line 2section, and quality incentive payments made pursuant to subsection (5)(b)(III) of this section;

• Page 8, Line 3(6)  Appropriations. (a) (I)  Except as otherwise provided in

• Page 8, Line 4subsection (6)(b)(I.5) or (6)(b)(I.7) of this section, the healthcare

• Page 8, Line 5affordability and sustainability fee is and public funds are to

• Page 8, Line 6supplement, not supplant, general fund appropriations to support hospital

• Page 8, Line 7reimbursements. General fund appropriations for hospital reimbursements

• Page 8, Line 8shall be maintained at the level of appropriations in the medical services

• Page 8, Line 9premium line item made for the fiscal year commencing July 1, 2008;

• Page 8, Line 10except that general fund appropriations for hospital reimbursements may

• Page 8, Line 11be reduced if an index of appropriations to other providers shows that

• Page 8, Line 12general fund appropriations are reduced for other providers. If the index

• Page 8, Line 13shows that general fund appropriations are reduced for other providers,

• Page 8, Line 14the general fund appropriations for hospital reimbursements shall not be

• Page 8, Line 15reduced by a greater percentage than the reductions of appropriations for the other providers as shown by the index.

• Page 8, Line 16(b)  If the revenue from the healthcare affordability and

• Page 8, Line 17sustainability fee is insufficient to fully fund all of the purposes described in subsection (5)(b) of this section:

• Page 8, Line 18(II)  The hospital provider reimbursement and quality incentive

• Page 8, Line 19payment increases described in subsections (5)(b)(I) to (5)(b)(III)

• Page 8, Line 20subsections (5)(b)(I), (5)(b)(II), and (5)(b)(III) of this section and the

• Page 8, Line 21costs described in subsection (5)(b)(VI) of this section shall be fully

• Page 8, Line 22funded using revenue from the healthcare affordability and sustainability

• Page 8, Line 23fee and federal matching funds before any eligibility expansion is funded;

• Page 8, Line 24and

• Page 9, Line 1(c)  Notwithstanding any other provision of this section, if, after

• Page 9, Line 2receipt of authorization to receive federal matching funds for money in

• Page 9, Line 3the fund, the authorization is withdrawn or changed so that federal

• Page 9, Line 4matching funds are no longer available, the enterprise shall cease

• Page 9, Line 5collecting the healthcare affordability and sustainability fee and

• Page 9, Line 6receiving public funds and shall repay to the hospitals any money received by the fund that is not subject to federal matching funds.

• Page 9, Line 7(9)  State-directed payments program - funding and

• Page 9, Line 8implementation.The enterprise, acting in concert with, or

• Page 9, Line 9through an agreement with, the state department, if required by

• Page 9, Line 10federal law, shall seek a state plan amendment or any federal

• Page 9, Line 11authorization necessary to fund and, in cooperation with the

• Page 9, Line 12state department and hospitals, support the implementation of

• Page 9, Line 13a state-directed payment program in compliance with 42 CFR

• Page 9, Line 14438.6(c) that complies with all federal requirements for

• Page 9, Line 15financing of the non-federal share and shall support a total

• Page 9, Line 16payment rate for each state-directed payment that does not

• Page 9, Line 17exceed the average commercial rate and is distributed pursuant to the requirements of subsection (5) of this section.

• Page 9, Line 18SECTION 5.  In Colorado Revised Statutes, 25.5-5-402, add(7.3) as follows:

• Page 9, Line 1925.5-5-402.  Statewide managed care system - rules -

• Page 9, Line 20definitions.(7.3) (a)  Beginning January 1, 2026, for a claim that

• Page 9, Line 21must be reprocessed as a result of updating the provider rates,

• Page 9, Line 22an MCO shall issue payment to the contracted provider within one year after the provider rate is updated.

• Page 9, Line 23(b)  The state department shall notify the MCOs of any

• Page 10, Line 1change to the provider rates within sixty days of changing the provider rates.

• Page 10, Line 2SECTION 6.  In Colorado Revised Statutes, add 25.5-5-427 as follows:

• Page 10, Line 325.5-5-427.  Managed care entities - disclosure of payment and

• Page 10, Line 4medical loss ratio - definition. (1)  The state department shall

• Page 10, Line 5include in each new contract with, or renewal of a contract

• Page 10, Line 6with, an MCE a provision requiring the MCE to submit to the

• Page 10, Line 7state department, on an annual basis, the amount the MCE is paid for delivering services and the MCE's medical loss ratio.

• Page 10, Line 8(2)  The state department shall annually publish the following information on its website:

• Page 10, Line 9(a)  The information received pursuant to subsection (1) of this section;

• Page 10, Line 10(b)  Historicalmedicalloss ratio data for each MCE; and

• Page 10, Line 11(c)  Audit findings regarding an MCE's most recently completed medical loss ratio audit.

• Page 10, Line 12(3)  For purposes of subsection (1) of this section, "medical

• Page 10, Line 13loss ratio" means the percentage of premium revenue that the

• Page 10, Line 14MCE spends on health-care services and quality improvement activities.

• Page 10, Line 15SECTION 7.  In Colorado Revised Statutes, add 25.5-6-117 as follows:

• Page 10, Line 1625.5-6-117.  Plan of care - rehabilitation therapy -

• Page 10, Line 17requirements - definition. (1)  As used in the section, unless the

• Page 10, Line 18context otherwise requires, "plan of care" has the same meaning

• Page 10, Line 19as set forth in section 25.5-6-403.

• Page 11, Line 1(2)  The state department shall not impose signature

• Page 11, Line 2requirements beyond what is required by the federal centers for

• Page 11, Line 3medicare and medicaid services pursuant to 42 CFR 409.43 on a

• Page 11, Line 4physician or practitioner certifying a member's plan of care that

• Page 11, Line 5involves physical therapy, occupational therapy, or speech therapy services.

• Page 11, Line 6SECTION 8.  In Colorado Revised Statutes, add 25.5-6-118 as follows:

• Page 11, Line 725.5-6-118.  Long-term care for members with permanent

• Page 11, Line 8disability. (1)  For a member receiving services through a

• Page 11, Line 9long-term care program pursuant to parts 3 to 10 of this article

• Page 11, Line 106, if a service the member receives is discontinued or is no longer

• Page 11, Line 11a covered service, the state department must confirm the

• Page 11, Line 12timeline for continuity of treatment with the federal centers

• Page 11, Line 13for medicare and medicaid during the transition period of the

• Page 11, Line 14benefit or service being discontinued. Upon confirmation, the

• Page 11, Line 15state department shall communicate the timeline to the member impacted by the benefit or service being discontinued.

• Page 11, Line 16(2)  This section applies to members who are functionally

• Page 11, Line 17and financially eligible to receive long-term care services pursuant to parts 3 to 10 of this article 6.

• Page 11, Line 18SECTION 9.  In Colorado Revised Statutes, 25.5-6-2001, amend (2)(a), (2)(c)(II), (2)(c)(III), (3)(a), and(7)(b) as follows:

• Page 11, Line 1925.5-6-2001.  System of care for children and youth - federal

• Page 11, Line 20authorization - leadership and implementation team - report - rules

• Page 11, Line 21- definition. (2) (a)  No later than November 1, 2024, Thestate

• Page 11, Line 22department shall convene a leadership team that is responsible for the

• Page 12, Line 1decision-making and oversight advising and reviewing the

• Page 12, Line 2development and operation of the system of care for children and youth who have complex behavioral health needs.

• Page 12, Line 3(c)  The leadership team has the following duties and responsibilities:

• Page 12, Line 4(II)  To oversee and advise review and advise on the strategic direction of the development of the system of care; and

• Page 12, Line 5(III)  To provide fiscal oversight of the state department's

• Page 12, Line 6development and oversight of the system of care review and comment

• Page 12, Line 7on the state department's fiscal development and oversight of the system of care.

• Page 12, Line 8(3) (a)  No later than October 1, 2024, Thestate department shall

• Page 12, Line 9convene an implementation team that shall create a plan utilizing the

• Page 12, Line 10recommendations from the leadership team, as appropriate, to

• Page 12, Line 11implement the system of care for children and youth who have complex behavioral health needs.

• Page 12, Line 12(7) (b)  Beginning January 2025, and each quarter thereafter, the

• Page 12, Line 13state department shall report progress on the development and

• Page 12, Line 14implementation of the system of care developed pursuant to this section

• Page 12, Line 15to the joint budget committee, the implementation team, the

• Page 12, Line 16leadership team, the senate health and human services

• Page 12, Line 17committee, and the house of representatives health and human

• Page 12, Line 18services committee. The report required by this subsection (7)(b)

• Page 12, Line 19must include the rationale for any recommendation from the leadership team that the department elects not to implement.

• Page 12, Line 20SECTION 10.  Act subject to petition - effective date. This act

• Page 12, Line 21takes effect at 12:01 a.m. on the day following the expiration of the

• Page 13, Line 1ninety-day period after final adjournment of the general assembly; except

• Page 13, Line 2that, if a referendum petition is filed pursuant to section 1 (3) of article V

• Page 13, Line 3of the state constitution against this act or an item, section, or part of this

• Page 13, Line 4act within such period, then the act, item, section, or part will not take

• Page 13, Line 5effect unless approved by the people at the general election to be held in

• Page 13, Line 6November 2026 and, in such case, will take effect on the date of the official declaration of the vote thereon by the governor.