Into the Blue

The Legacy of 2020

Last year provided enough historic events to fill a volume of textbooks: a global pandemic, a sudden and deep economic recession, a contentious presidential election, and what may have been the largest social justice demonstration in U.S. history.

Current crises in public health, the economy, political polarization, and systemic racism constitute a syndemic — a set of challenges that build on each other and complicate efforts to respond. These events will reverberate throughout the upcoming legislative session and cast a shadow over nearly everything state policymakers attempt this year. 

Colorado’s political leaders have had little time to ponder the lessons of 2020, but given the delayed start to the session, now is a good time to ask what we have learned — or should have learned — to make 2021 a more just, peaceful, and successful year. Four observations:

Life comes at you fast. 

The coronavirus has taken us on a dizzying ride, with lulls in infection rates quickly giving way to spikes. The economy has followed the same path. It collapsed last spring at a speed not seen since the Great Depression but rebounded enough for Gov. Jared Polis to propose a larger budget with new spending priorities. Repeatedly, 2020 showed us that today’s situation isn’t a reliable predictor of tomorrow’s. Legislators would be wise to brace for another dip in the economy that could complicate the state budget and leave many Coloradans struggling to pay for basic needs.

Inequities can’t be ignored. 

Last year showed systemic inequities in stark relief. The voices of protesters in the streets led to a bipartisan police accountability bill. Promoting equity is highly likely to be an important part of policy discussions this session.  

You can’t count on the cavalry.  

President-elect Biden campaigned on promises that many Colorado Democrats would love to see fulfilled, such as a public option for health coverage and financial relief for cities and states. Raphael Warnock and Jon Ossoff’s victories in the Georgia runoff elections mean Democrats will soon control the U.S. Senate. But their majority is very narrow, whick makes it unlikely that we will see fundamental changes in federal health policy. Most innovations will come from the states. 

Policy depends on people. 

The most effective public health responses to the pandemic depend on ordinary people to carry them out — staying home, wearing a mask, and getting vaccinated when it’s your turn. The politicization of these actions has made the pandemic much worse than it needed to be. It will drag on longer still unless people have faith that their leaders are pushing policies that make sense and are justified.

Eyes on the ACA

In November 2020, a legal challenge to the Affordable Care Act (ACA) — California v. Texas — came before the U.S. Supreme Court. 

Playing offense is the state of Texas, which argues, along with 17 other states and two individuals, that the entire ACA needs to be struck down. They assert that the ACA became unconstitutional when Congress set the penalty for those who don’t have insurance (the “individual mandate”) to $0 in 2017.

Arguing in defense of the ACA is California, joined by 19 other states (including Colorado) and the District of Columbia. They argue that the zero-dollar individual mandate is not unconstitutional, and even if it were, they say that piece of the ACA can be separated — or “severed” — from the rest of the act.

The Supreme Court is expected to announce a ruling no later than June. Its decision will either leave the ACA fully intact, toss out the individual mandate, or — in the worst-case scenario for many advocates — strike down the entire ACA.

Many supporters of the ACA are optimistic that the justices will rule in their favor. But the impacts of an ACA repeal, however unlikely, would be profound and far-reaching. 

Colorado policymakers may hustle to shore up some state-level protections, like setting out sandbags for a hurricane that may or may not make landfall. Meanwhile, federal lawmakers have the power to pass legislation that would make the case moot. President Biden and Congress are almost certain to bolster the ACA following Georgia’s runoff elections, which gave Democrats control of the U.S. Senate. 

In the absence of swift and decisive Congressional action, the fate of the law is in the hands of nine justices in Washington, D.C. All eyes will be on the ACA this spring. 

State Election Results

Voters across Colorado spoke in the November election, and they spoke loudly. Nearly 3.3 million ballots were cast, setting a new state record of 76.4% participation by eligible voters. Only Minnesota had a higher turnout. 

Colorado is becoming a more reliably Democratic state, though politics at the local level can be extremely polarized. Democrats easily retained their majority in the state House while picking up an additional seat to pad their control in the Senate. With Polis entering the second half of his first term, Democrats’ trifecta is secure for at least another two years. 

The General Assembly is not unique in its increasingly blue hue. The state’s voters are moving this direction too, based on how they voted for items on their ballots. Policies that were recently thought to be too progressive by legislators were easily approved by voters in November, even in historically conservative hubs like El Paso, Douglas, and Weld counties.

Spotlight: Ballot Measures

Proposition EE: Tobacco and Nicotine Tax

Coloradans have historically opposed efforts to increase the taxes they pay, but they sometimes make an exception for “sin” taxes, or taxes on items considered dangerous or unhealthy.

Some 68% of voters were in favor of Prop. EE, an increased tax on tobacco and nicotine products — which represents a landslide victory and a reversal of how Coloradans voted on smoking taxes in the past. A similar amendment failed in 2016, thanks to millions of dollars from tobacco companies lobbying against the measure. This year was different, with most counties across the state, save for a large swath on the Eastern Plains, voting to increase tobacco and nicotine taxes. 

Prop. EE will increase the tax on most tobacco products from 40% to 50% of their list price starting this year. Taxes on nicotine products, including those for vaping, will begin at 20% of their list price — up from no tax at all. This will gradually increase to 62% by 2027 for both tobacco and nicotine taxes, with funds dedicated to education, health, and housing programs. 

Proposition 116: Reduction in State Income Tax

Coloradans voted to reduce the state income tax starting in 2021. Colorado’s previous 4.63% state tax, already one of the lowest in the nation, will be reduced to 4.55%. The average Coloradan can expect to pay $37 less in income taxes thanks to Prop. 116, though savings will depend on individual income. 

Proponents of the proposition say tax relief is coming at a time when Coloradans need it most. Critics of Prop. 116 argue that while Coloradans will see modest decreases to their income taxes, the blow to the budget and state-funded programs will be substantial, offsetting the relatively small gains to individual households. Decreasing taxes leaves the state with $154 million less to spend in the next fiscal year when the budget is already tight. Prop. 116’s financial impact on the budget will continue to grow as Colorado’s economy and workforce recover from the recession. 

Proposition 118: Paid Family Leave

State legislation for mandated paid family leave had failed to pass six times under the Gold Dome, even when Democrats held full control, so the widespread support for such a progressive measure was surprising. Nearly six out of 10 voters (57.7%) said they wanted the state to establish a paid family and medical leave program. Counties that supported President Donald Trump, including El Paso and Weld, also voted in favor of paid family leave. 

Prop. 118 ensures employees can take 12 weeks of paid family leave starting in 2023. Employers will be required to pay into the state-run program unless they purchase paid-leave insurance on the private market. Under the state plan, employers and employees will chip in equally to pay for this benefit through a new payroll tax, costing the average worker around $4.50 per week, or $234 per year. 

Other Ballot Measures

Coloradans frequently said “yes” during the 2020 general election. Nearly all amendments and propositions on the state ballot passed, including measures officially approving the state joining the National Popular Vote Interstate Compact, reintroducing gray wolves onto public lands, and adding more public control of state enterprise funds. Proposition 115 — a proposed ban on abortion after 22 weeks — and a measure to allow charitable gaming activities were the only state ballot measures that did not pass.

Gallagher Repealed, TABOR’s Undoing? 

In a historic move, state legislators from both parties voted to put Amendment B on the November ballot. The amendment asked Coloradans if they wanted to repeal a 1982 statewide standard for property taxes, commonly called the Gallagher Amendement, which has meant residential property taxes in Colorado could not account for more than 45% of total property taxes. This has required other properties, like commercial buildings, to make up the remaining 55%. The cap has shifted the tax burden onto businesses as home values have continued to skyrocket over the past decade. While this has provided relief for homeowners through lower taxes, Gallagher has also prevented local governments from receiving crucial funding for public services like fire departments. 

The strong vote to repeal Gallagher could inspire new attempts to repeal the Taxpayer’s Bill of Rights, known as TABOR. TABOR limits state revenue and requires voters to approve all tax increases. Democrats have loathed TABOR, saying its restrictions have robbed Coloradans of vital aid, while TABOR proponents say limiting government spending is a necessary restriction to ensure fiscal accountability. 

State Legislature

The balance of power in Colorado’s state legislature tilted only slightly following the 2020 election.

Democrats in the House of Representatives retained 41 of the 65 districts, cementing their near supermajority. House Democrats will only need 33 votes to move bills through the chamber, something they can easily accomplish provided policy or political disagreements do not split their caucus. 

Republicans had a chance to regain control of the state Senate, which would have required winning three battleground races in the 19th, 25th, and 27th districts. Republicans held two of these districts before the election but only managed to win one — allowing Democrats to expand their majority by one seat. Democrats in the Senate will need 18 votes to pass a bill, which they can do with their now 20 seats, but will need nearly the entire party in agreement to do so. 

See Appendix A for more detail on the makeup of the House and Senate, along with 2021 health committee assignments. 

Legislative Leadership

A notable change for the 2021 session is the entirely new leadership team in the House. Rep. Alec Garnett (D–Denver) will serve as Speaker of the House, and Rep. Daneya Esgar (D–Pueblo) has moved from chair of the Joint Budget Committee to House Majority Leader. Republicans nominated Rep. Hugh McKean (R–Loveland) as the new House Minority Leader. McKean, seen as a moderate and traditional conservative, replaces Rep. Patrick Neville (R–Castle Rock), who has been less inclined to compromise with those across the aisle and represented more of President Trump’s conservative brand. 

Colorado’s Senate leadership team sees no change from the previous year. Sen. Leroy Garcia (D–Pueblo) will remain as President of the Senate, along with Sens. Steve Fenberg (D–Boulder) as Majority Leader and Chris Holbert (R–Parker) as Minority Leader. 

The Joint Budget Committee

Democrats again hold a four-to-two majority in the bipartisan Joint Budget Committee (JBC), which is tasked with writing Colorado’s budget each year. Sen. Dominick Moreno (D–Commerce City) will serve as committee chair, with Rep. Julie McCluskie (D–Dillon) as vice chair. Rep. Leslie Herod (D–Denver) is the lone new member of the JBC, but she is not new to fiscal policy. Herod served as a senior policy advisor under Gov. Bill Ritter earlier in her career. 

A seat on the JBC can be an enviable position when the state’s economy is booming, as its members allocate how the state spends its money. But serving on the committee is not all glory: Those who control the money are often the first to be blamed for reductions in funding when money is tight, like during the current recession. 

Last year’s JBC used many one-time moves to help balance the budget amid the fallout from the COVID-19 pandemic. Those measures won’t be available this year should the economy take a turn for the worse. Continued uncertainty means the JBC has a difficult job this session. 

The Budget

In the 2021 session, the budget may be the most significant factor determining which bills pass into law. The final budget, also called the Long Bill, determines what legislators can afford to do. Since 2020 was anything but a typical year, fiscal repercussions will follow legislators for years to come. 

Polis submitted an optimistic Fiscal Year (FY) 2021-22 budget request in early November, given the economic volatility and widespread unemployment, though recent forecasts project a fast economic recovery for the next fiscal year. Polis’ budget emphasizes pandemic, economic, and wildfire recovery; restoring funding for state departments; and replenishing state reserves that were impacted by Colorado’s response to COVID-19. The plan includes $13.6 billion in the General Fund — a 20% increase from the current fiscal year’s budget, which took a major hit last spring. 

Health care continues to be a primary focus in the budget, accounting for a large portion of total dollars. Polis’ priorities are to establish a public option and rein in the costs of pharmaceuticals. The Department of Health Care Policy and Financing (HCPF) would receive over a quarter (25.9%) of General Fund dollars, second only to the Department of Education, which receives a third (33.2%). Polis also aims to backfill federal funding losses for Child Health Plan Plus (CHP+) — a public insurance program for kids and pregnant women with low incomes — as well as improve IT resources for behavioral health programs and identify and address racial disparities among Medicaid enrollees. 

Maintaining a balanced budget means that spending money for one program can mean cuts for others. A new inpatient and residential substance use disorder treatment program under Medicaid will start in 2021, but this meant reductions in the governor’s request to different substance use programs under HCPF, the Office of Behavioral Health (housed in the Department of Human Services), and Community Corrections (housed in the Department of Public Safety). The governor’s approach has concerned some advocates who believe that there is not enough money for substance use disorder programs to begin with and that adding funds for some programs while taking them away from others will not ultimately help the problem. 

Most years, the Long Bill looks very similar to the governor’s budget request, but this year its final form may differ more than usual from what has been proposed. Uncertainty related to the pandemic’s lasting effects and whether the legislature will actually reconvene on February 16, as planned, may lead the JBC to allocate state dollars differently than Polis has sought.

Bills and Issues to Watch 

Bills to Expect

As 2021 progresses, how might “COVID policy fatigue” affect the session? Considerable time and energy have already been dedicated to urgent policy actions in response to the pandemic, though challenges persist. COVID’s impacts and the state’s response will loom over the session and could push aside other policy conversations, such as those related to hospital financial reform. 

But it appears that despite the pandemic, the session will be an active one for health policy. Many health bills are expected, and many of them will look familiar from the 2020 regular session. If not for the pandemic, it’s likely that some of these proposals would have already been signed into law.

While by no means a comprehensive list, the following is an overview of important health policy topics for the year ahead.

The Big Three

Public Option

Conversations around creating a public insurance option — which instead became known last session as a “state option” — have taken center stage at the Capitol for several years. A new public option proposal will be introduced in 2021, and the governor signaled his support for the idea by calling it out as a priority in his budget request. Health policy watchers generally agree that this will be the most anticipated, and one of the most controversial, bills this session.

During the 2020 session, House Bill (HB) 20-1349 called for a state-designed insurance plan to be offered by private carriers. The plan would achieve affordable premiums through savings from hospital rate setting for services provided to its enrollees, and at least two insurers would be required to offer coverage in each county of the state.

Industry representatives were not supportive of the approach, and both hospitals and insurers prepared for a fight at the Capitol. Hospital advocates instead floated a proposal for a “total cost of care” model, which they said was more fair. (Notably, hospitals are not planning to bring this bill back in 2021.) But then COVID-19 interrupted the session, hospital finances changed drastically, and sponsors announced during the legislative recess that they were withdrawing the bill.

A similar group of legislators is likely to carry the new version of the bill in 2021, though the program’s design will differ. Sponsors are likely to propose a “true” public option — allowing people to buy in to the Medicaid program or something else administered by the state, almost certainly under HCPF, instead of last year’s public-private hybrid structure. The funding could and likely will look different, as sponsors can consider federal, state, and industry sources to pay for the plan. Other states, for example, have proposed using ACA waivers to reallocate federal funds for a state-level public option.

Prescription Drug Pricing

While Polis and Democratic leaders have made progress on many of their top health policy goals in the past two years, success in addressing pharmaceutical prices has eluded them. Legislators did pass a high-profile bill (HB 19-1216) to cap the price of insulin for Coloradans enrolled in state-regulated health insurance plans, but broader attempts to increase transparency or save consumers money have failed to gain traction.

Pharmaceutical companies are in the crosshairs of the governor’s office, and Polis’ budget request indicates interest in considering options up for discussion in other states. 

A forthcoming bill will propose the creation of a Prescription Drug Affordability Board. The effort, led by the Colorado Consumer Health Initiative, was planned for last year but was never introduced. The new board would include experts on health care and prescription drugs with no conflict of interest in industry. Its five members would conduct affordability reviews and, most notably, it would have the authority to set upper payment limits for the most unaffordable prescription drugs in Colorado.

Rep. Dylan Roberts (D-Avon) intends to bring another bill focused on the price of insulin for uninsured Coloradans and those on insurance plans regulated at the federal level or by other states. In addition, recent bills to require greater transparency — such as a 2020 effort to create the “Colorado Prescription Drug Price Transparency Act” — may be back, as may bills targeting pharmaceutical rebate practices. 

Elected officials across the political spectrum want to do something about unaffordable prescription drug prices, so this topic may present a strong opportunity for bipartisan collaboration.

Behavioral Health

Even before the arrival of a global pandemic, more than a million Coloradans were struggling with behavioral health conditions — and COVID-19 has only exacerbated stresses related to mental health and substance use. The House has even renamed one of its two health committees to emphasize a focus on this issue: the Public and Behavioral Health and Human Services Committee.

Recent discussions in the legislature and work by the bipartisan Interim Committee on Opioid and Other Substance Use Disorders have made clear that the political will exists to tackle behavioral health needs and gaps in most areas, though some harm reduction efforts — like a proposal for supervised use sites — have proven too controversial at the Capitol. The bigger constraint in 2021 will be a lack of funding. While a group of notable bills passed last session to address substance use issues, many of the bills had the bulk of their funding stripped due to COVID-caused economic hardship. Since then, a variety of behavioral health programs have been delayed or recommended for budget cuts.

All eyes are on the Behavioral Health Task Force, a group convened by the governor that produced a report in September outlining problems and policy recommendations. For example, the Task Force identified that the $1.4 billion the state spends on behavioral health is spread across 10 agencies and at least 75 programs. Not only is this inefficient, according to its members, but the dispersed programs put a burden on people seeking services to navigate a complex system.

A bill this session will direct the Colorado Department of Human Services to draft a proposal for a streamlined Behavioral Health Administration, which would be created in 2022. The proposal would include recommendations for alignment between the Administration and both Medicaid and private insurers, which would continue to function separately. 

Also expected: the return of recent bills to require free, annual mental health wellness exams for Coloradans; to define the role of peer support professionals; to institute protections for secure transportation for people experiencing a behavioral health crisis; and to fund a pilot program to place more social workers in Colorado schools.

Other Notable Health Legislation

Supporting Health Care Providers

Health care providers have been under tremendous stress during the pandemic, and a handful of bills will aim to help them in different ways. In light of threats targeting everyone from nurses to Dr. Anthony Fauci, the director of the National Institute of Allergy and Infectious Diseases and the face of the U.S. pandemic response, a bill from the Colorado Association of Local Public Health Officials will seek to add public health workers to the list of professionals who are protected from having their personal information posted online. There likely will be legislation to protect confidentiality for health care providers who choose to access peer assistance program services, as advocates say that a failure to do so could have a chilling effect on doctors seeking support during challenging times. Expect legislation that eliminates the legal requirement for physician supervision of Physician Assistants, often called PAs, with at least three years of experience, but allows practices to establish their own supervision standards. And there may be bills or other proposals to support direct care workers, such as home health aides or personal care assistants, who have been stretched thin and underpaid since long before the pandemic.

Improving Technology

Technology has been a lifeline for many patients while in-person visits have been unsafe or largely inaccessible. Telehealth usage has surged since March, including among providers who hadn’t conducted remote visits previously. Policymakers want to ensure continued access to care and data integrity. While last spring’s successful Senate Bill (SB) 20-212 codified some temporary telehealth rule changes, uncertainty remains. Some state leaders question the necessity and sustainability of Colorado’s payment parity rule, passed in 2015, which requires equal reimbursement rates for in-person and virtual visits. HCPF had planned to bring legislation proposing some type of change to this rule, but ultimately reversed course and left tackling telehealth parity off the final version of its 2021 legislative agenda. However, there may be other telehealth-focused bills, including one seeking to expand the use of teledentistry. In addition, a likely bill would propose a process for streamlining and automating public health data reporting, which proponents say would improve data quality while lessening the burden on overworked health care providers.

Protecting Consumers

The governor and legislative leaders have been open about their desire to pass policies protecting consumers, regardless of industry opposition. (See, for example, successful recent bills to create a reinsurance program, mandate more hospital financial reporting, and the ongoing pursuit of a public option.) This session will feature additional bills aimed at consumer protection. For instance, an effort led by the Colorado Center on Law and Policy would require better compliance and enforcement for a hospital discount program that consumer advocates feel is not working as intended. The House Health and Insurance Committee Chair, Rep. Susan Lontine (D–Denver), will once again sponsor a bill targeting health care sharing arrangements (often known as health care sharing ministries), which have been the subject of recent consumer advisories and cease-and-desist orders from the Division of Insurance (DOI). And more work is expected on regulating out-of-network (or “surprise”) billing practices, which are also being targeted at the federal level. Details aren’t yet available, though groups that backed HB 19-1174 — a breakthrough in tackling surprise bills — are likely to collaborate again. 

Increasing Access to Services

Several bills in 2020 proposed adding benefits to the list of those covered by insurance companies. Some passed and others stalled out, hurt by both the pandemic and a veto from Polis with a warning that he would not sign additional bills to increase insurance mandates. This session, a returning bill from the Colorado Association of Health Plans would require up-front analysis of any new legislation that adds to the list of covered services — a policy change that could cause some groups to hold off on pushing additional benefit proposals. (Notably, there’s no need for one of the 2020 mandate bills to come back. It had proposed lowering the age for covered colon cancer screenings, but after the session that change was made at the national level, making a state policy change unnecessary.) In this category, there will also be a bill from the Colorado Organization for Latina Opportunity and Reproductive Rights (COLOR) to expand Medicaid coverage to include contraceptives for people without documentation. Several groups are working on maternal health proposals, with a focus on both physical and mental health for people who are pregnant or postpartum. With a pending decision on the legality of the ACA in the Supreme Court, there may also be bills or other discussions about ensuring more state-level protections for parts of the decade-old law.

Addressing Contributing Factors

Health is a broad subject that intersects with many other topics, such as housing, food security, and income. A great deal of “health-adjacent” legislation is in the works. For example, legislators will introduce another slate of housing bills in 2021, including more focus on rental assistance and tenants’ rights. There will be efforts to protect Coloradans against different types of discrimination, such as age-based discrimination in hiring — protections that advocates say are essential when unemployment is high. Conversations about universal preschool and employee classification (and how it affects workers’ benefits) are additional examples. Other bills and budget priorities, including those passed during the special session providing relief for child care, food pantries, and broadband, indicate a larger focus on combatting health inequities in Colorado. Expect racism to increasingly be called out as a public health issue, too.

Continuing Efforts

Beyond new bills and policy ideas, many important efforts from recent legislative sessions are in the planning or implementation phase. Some point to these efforts as examples of Colorado’s impressive progress and status as a health policy leader; however, others say the number of working groups and new programs already in motion should give policymakers pause, as they may want to see how certain initiatives play out before pushing even more large-scale changes.

Ongoing work at state agencies deserves close attention. This work includes the development of affordability standards at the DOI; the efforts of groups such as the Primary Care Payment Reform Collaborative and the new Health Insurance Affordability Enterprise Board, both overseen by DOI; and next steps for the Health Care Cost Analysis Task Force, which is considering the cost and feasibility of different insurance systems in the state.

In addition, there is continued interest in scaling up the community purchasing alliance model, pioneered by Peak Health Alliance in Summit County. Leaders in the governor’s office and DOI have made clear their enthusiasm for this model, and other communities outside the metro area are interested in replicating it.

There is no shortage of work in HCPF to improve Medicaid services, which impact nearly one in four Coloradans (current enrollment is over 1.4 million people). This ranges from attempts to shorten payment turnaround time for providers who are struggling during the pandemic to contingency planning for fluctuations in Medicaid enrollment over the coming months.

Finally, a deeply important topic in 2021 is immunizations. The first COVID-19 vaccines arrived in Colorado in mid-December, and vaccine distribution will be top of mind for everyone. State leaders will face challenges around the logistics of vaccine distribution, messaging to those hesitant about getting the vaccine, and the pros and cons of potential vaccination requirements. The state is also working through the rules and timeline for changes brought about by SB 20-163, a bill passed last session to tighten Colorado’s child immunization exemption requirements.

Conclusion

It’s the dawning of a new year but, in some ways, the 2021 legislative session feels like a redo. Similar efforts will return in the form of attempts to establish a public option, lower pharmaceutical costs, and increase patients’ access to care. But legislators will need to solve for new issues stemming from last year’s unprecedented events. A rebounding economy and vaccine distribution signal that 2020 may soon be entirely behind us — though hopefully not without lessons learned.