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July 28, 2023 HB 23-1226
Legislative Council Staff
Nonpartisan Services for Colorado’s Legislature
Final Fiscal Note
Drafting Number:
Prime Sponsors:
LLS 23-0720
Rep. Soper;
deGruy Kennedy
Sen. Roberts; Will
Date:
Bill Status:
Fiscal Analyst:
July 28, 2023
Signed into Law
Kristine McLaughlin | 303-866-4776
kristine.mclaughlin@coleg.gov
Bill Topic: HOSPITAL TRANSPARENCY & REPORTING REQUIREMENTS
Summary of
Fiscal Impact:
☒ State Revenue
☒ State Expenditure
☐ State Transfer
☐ TABOR Refund
☐ Local Government
☐ Statutory Public Entity
The bill adds information to be disclosed by hospitals for the hospital expenditure
report and allows the Department of Health Care Policy and Financing to enforce data
collection procedures through fines. The bill also places disclosure requirements on
hospitals. The bill increases state expenditures and may increase state revenue on an
ongoing basis.
Appropriation
Summary:
For FY 2023-24, the bill requires and includes an appropriation of $150,332 to the
Department of Health Care Policy and Financing.
Fiscal Note
Status:
The fiscal note reflects the enacted bill.
Table 1
State Fiscal Impacts Under HB 23-1226
Budget Year
FY 2023-24
Out Year
FY 2024-25
Revenue
- -
Expenditures Cash Funds $75,166 $82,169
Federal Funds $75,166 $82,168
Centrally Appropriated $31,345 $37,175
Total Expenditures $181,677 $201,512
Total FTE 1.7 FTE 2.0 FTE
Transfers - -
Other Budget Impacts - -
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July 28, 2023 HB 23-1226
Summary of Legislation
The bill requires hospitals to disclose additional information for the purposes of the hospital
expenditure report, which the bill renames the hospital transparency report, produced by the
Department of Health Care Policy and Financing (HCPF). The new reporting requirements include
details on specific revenue and expenditure streams, including historical data. HCPF may enforce data
collection procedures through corrective action plans or fines. Where HCPF determines a hospital’s
noncompliance is knowing or willful or there is a repeated pattern of noncompliance, HCPF may set
a fine amount up to $20,000 per week until the hospital takes corrective action.
Additionally, beginning July 1, 2024, the bill requires hospitals to provide patients with a plain
language description of the services billed and disclose that the patient has the right to further billed
services information.
Background
In its 2023 hospital expenditure report, HCPF recommended that the legislature consider establishing
corrective action and financial penalties for hospital noncompliance with reporting requirements.
State Revenue
Beginning in FY 2023-24, the bill may increase state revenue from fines, credited to the General Fund.
This revenue is classified as a damage award and not subject to TABOR. Given the uncertainty about
the number of violations and the potential penalty amounts, the revenue impact cannot be estimated.
State Expenditures
The bill increases state expenditures in the Department of Health Care Policy and Financing (HCPF)
by $180,000 in FY 2023-24 and $200,000 in FY 2024-25, split evenly between the Healthcare
Affordability and Sustainability (HAS) Cash Fund and federal funds. Expenditures are shown in
Table 2 and detailed below.
Table 2
Expenditures Under HB 23-1226
FY 2023-24 FY 2024-25
Department of Health Care Policy and Financing
Personal Services $134,697 $161,637
Operating Expenses $2,295 $2,700
Capital Outlay Costs $13,340 -
Centrally Appropriated Costs
1
$31,345 $37,175
Total Cost $181,677 $201,512
Total FTE 1.7 FTE 2.0 FTE
1
Centrally appropriated costs are not included in the bill's appropriation.
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July 28, 2023 HB 23-1226
Department of Health Care Policy and Financing. HCPF requires 2.0 FTE to ensure compliance and
incorporate the new data into the report. Based on noncompliance with current reporting, examining
the data that hospitals submit for compliance with the current and the expanded requirements and
implementing a corrective action plan is expected to be a complex process. Additionally, the newly
required data is more granular than the current data and will require time and expertise to aggregate
to a level appropriate for the report.
The state-share of the FTE costs will be funded by the HAS Cash Fund, because this bill concerns data
and analysis to measure the efficacy of the HAS fee, cost shift, and Hospital Transformation Program.
Standard operating and capital outlay costs are included, and costs in FY 2023-24 are prorated to
reflect the bill’s effective date.
Centrally appropriated costs. Pursuant to a Joint Budget Committee policy, certain costs associated
with this bill are addressed through the annual budget process and centrally appropriated in the Long
Bill or supplemental appropriations bills, rather than in this bill. These costs, which include employee
insurance and supplemental employee retirement payments, are shown in Table 2.
Effective Date
The bill was signed into law by the Governor on June 2, 2023, and takes effect on August 7, 2023,
assuming no referendum petition is filed.
State Appropriations
For FY 2023-24, the bill requires and includes an appropriation of $150,332 split evenly between
Healthcare Affordability and Sustainability Cash Funds and federal funds, to the Department of
Health Care Policy and Financing, and 1.7 FTE.
State and Local Government Contacts
Health Care Policy and Financing Public Health and Environment
The revenue and expenditure impacts in this fiscal note represent changes from current law under the bill for each
fiscal year. For additional information about fiscal notes, please visit: leg.colorado.gov/fiscalnotes.