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April 17, 2024 SB 24-168
Legislative Council Staff
Nonpartisan Services for Colorado’s Legislature
Revised Fiscal Note
(replaces fiscal note dated March 18, 2024)
Drafting Number:
Prime Sponsors:
LLS 24-0080
Sen. Roberts; Simpson
Rep. McCluskie; Martinez
Date:
Bill Status:
Fiscal Analyst:
April 17, 2024
Senate Appropriations
Brendan Fung | 303-866-4781
brendan.fung@coleg.gov
Bill Topic: REMOTE MONITORING SERVICES FOR MEDICAID MEMBERS
Summary of
Fiscal Impact:
☐ State Revenue
☒ State Expenditure
☐ State Transfer
☐ TABOR Refund
☐ Local Government
☐ Statutory Public Entity
The bill requires the Department of Health Care Policy and Financing to reimburse
outpatient facilities for telehealth remote patient monitoring services, award grants for
facilities to purchase equipment for telehealth remote monitoring, and cover
continuous glucose monitors for Medicaid members. It increases state expenditures
beginning in FY 2024-25.
Appropriation
Summary:
For FY 2024-25, the bill requires an appropriation of $98,703 to the Department of
Health Care Policy and Financing.
Fiscal Note
Status:
This revised fiscal note reflects the introduced bill, as amended by the Senate Health
and Human Services Committee. It has been revised to reflect new information.
Table 1
State Fiscal Impacts Under SB 24-168
Budget Year
FY 2024-25
Out Year
FY 2025-26
Out Year
FY 2026-27
Revenue - - -
Expenditures General Fund $98,703 $1,433,112 $1,172,301
Cash Funds - $119,369 $174,171
Federal Funds - $1,722,638 $2,520,983
Centrally Appropriated $18,401 $23,001 -
Total Expenditures $117,104 $3,298,120 $3,867,455
Total FTE 0.8 FTE 1.0 FTE -
Transfers - - -
Other Budget Impacts General Fund Reserve $14,805 $214,967 $175,845
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April 17, 2024 SB 24-168
Summary of Legislation
The bill requires the Department of Health Care Policy and Financing (HCPF) to provide
reimbursement and grants to outpatient health care facilities that use expanded telehealth
remote patient monitoring (RPM) services for certain patients and geographic locations. HCPF
must also provide coverage for continuous glucose monitors (CGM) under Medicaid.
Telehealth remote monitoring – reimbursement. The bill expands patient eligibility for RPM
services and requires HCPF to reimburse outpatient facilities for service costs provided to
Medicaid members beginning July 1, 2025. HCPF must also initiate a stakeholder process with
providers who serve rural and underserved populations to determine the billing structure for
RPM services, and make rules by June 30, 2025.
Telehealth remote monitoring – grant program. The bill creates the Telehealth Remote
Monitoring Grant Program in HCPF to award grants for outpatient facilities located in a
designated rural county or health care professional shortage area to acquire equipment for RPM
services. To be considered for a grant, an outpatient facility must meet certain criteria and have
a demonstrated need for financial assistance.
Additionally, the bill requires the administration and oversight of RPM services to be performed
by a licensed physician, podiatrist, advanced practice registered nurse, physician assistant,
respiratory therapist, pharmacist, or a licensed professional working under the supervision of a
medical director.
Continuous glucose monitors – coverage. Beginning on November 1, 2025, HCPF must
provide coverage for CGMs and related supplies to members under the Medicaid medical and
pharmacy benefit, including repairs and replacement. The bill expands eligibility for coverage
and aligns criteria with local determination standards issued by the Centers for Medicare and
Medicaid and individuals with gestational diabetes.
Background
Colorado’s Medicaid program, Health First Colorado, offers RPM for members through
equipment that sends data from the member's home to their home health agency. This service
manages and monitors members with medical needs that can be met at home, ensuring timely
interventions and cost efficiency. Eligibility for this service requires members who are receiving
home health services from a provider offering telehealth, need frequent monitoring for their
disease or condition, have a compatible home environment for the equipment, and the member
or caregiver must be capable of complying with self-monitoring of vital signs.
Members are currently eligible for a CGMs if they have been diagnosed with Type 1 Diabetes,
Type 2 Diabetes, or Gestational Diabetes; if they are receiving at least three insulin
administrations per day; and if their treatment regime requires frequent adjustment based on
CGM results, among other criteria.
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April 17, 2024 SB 24-168
In September, 2022, HCPF released its contract for the Pharmacy Benefit Management System
(PBMS), Rebate Administration, Real-Time Benefit Tool, and Preferred Drug List modules in
Change Healthcare, the department’s healthcare management system. The department is
finalizing its contract for a new PBMS and under the contract, may bill CGMS as a pharmacy
benefit, which are eligible for pharmacy rebates.
State Expenditures
The bill increases state expenditures in HCPF by about $117,000 in FY 2024-25, $3.3 million in
FY 2025-26, and $3.9 million FY 2026-27 and ongoing, paid from the General Fund, the Health
Care Affordability and Sustainability (HAS) Cash Fund, and federal funds. Expenditures are
shown in Table 2 and detailed below.
Table 2
Expenditures Under SB 24-168
FY 2024-25 FY 2025-26 FY 2026-27
Department of Health Care Policy and Financing
Personal Services $91,009 $113,761 -
Operating Expenses $1,024 $1,280 -
Capital Outlay Costs $6,670 - -
Telehealth Remote Monitoring – Reimbursement - $583,554 $752,670
Telehealth Remote Monitoring – Grant Program - $500,000 -
Continuous Glucose Monitors – Coverage (see Table 3) - $2,076,524 $3,114,785
Centrally Appropriated Costs
1
$18,401 $23,001 -
Total Cost
$117,104 $3,298,120 $3,867,455
General Fund
$98,703 $1,433,112 $1,172,301
HAS Cash Fund - $119,369 $174,171
Federal Funds - $1,722,638 $2,520,983
Centrally Appropriated $18,401 $23,001 -
Total FTE 0.8 FTE 1.0 FTE -
1
Centrally appropriated costs are not included in the bill's appropriation.
Telehealth remote monitoring – reimbursement. HCPF expenditures for RPM reimbursement
will increase by an estimated $584,000 in FY 2025-26 and $753,000 starting in FY 2026-27. RPM
is eligible for a 51 percent federal match.
The amount of reimbursement for RPM services under the bill will depend on a variety of
factors, including the prevalence of members who use the service, the monthly cost per
member, and the number of outpatient facilities that currently provide RPM as compared to
those in the future that will provide the services after receiving grant funding.
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April 17, 2024 SB 24-168
The fiscal note assumes that:
of eligible members—estimated at 1,117 members living in rural areas and 6,755 members
living in urban areas—about 8 percent will receive services based on current utilization rates;
the average monthly cost per member is $155 and includes one add-on service each month,
such as medication management; and
only half of eligible outpatient facilities are currently equipped to provide services prior to
implementation of the grant program.
Based on these assumptions, 620 newly eligible members will utilize RPM services at an annual
rate of $1,863 and a one-time start-up cost. In FY 2025-26, it is assumed that only 50 percent of
estimated members will receive services and incur reimbursement costs for HCPF due to limited
facilities currently offering services. Beginning in FY 2026-27, upon full implementation of the
Telehealth Remote Monitoring Grant Program, it is assumed that additional facilities will offer
services, allowing 65 percent of eligible members to receive services and increase
reimbursement costs for HCPF.
Telehealth remote monitoring – grant program. The Telehealth Remote Monitoring Grant
Program will increase HCPF expenditures by about $117,000 in FY 2024-25 and $638,000 in
FY 2025-26, paid from the General Fund, to award grants to eligible outpatient facilities offering
RPM services.
Staff. In FY 2024-25 and FY 2025-26, HCPF requires 1.0 FTE Program Manager III to establish
the program, develop program materials, conduct outreach to rural outpatient facilities,
audit grant recipients, and evaluate program metrics. Staff costs and FTE are prorated in the
first year based on the bill’s effective date. This staffing level assumes $500,000 will be made
available for grants; however, if more or less funding is available for the grant programs,
staffing costs will decrease or increase accordingly.
Grants. In FY 2025-26, the fiscal note assumes that $500,000 will be available for grants to
purchase remote monitoring equipment and train staff on procedures. The number and size
of grants awarded through the program depend on the amount of funding, which may be
set at the discretion of the General Assembly. It is assumed that HCPF will begin awarding
grants on July 1, 2025, and require staff beginning in FY 2024-25 to set up the grant
program.
Continuous glucose monitors – coverage. Expenditures for CGM coverage will increase by
about $2.1 million in FY 2025-26 and $3.1 million starting in FY 2026-27. Currently, CGMs are
eligible for a 69 percent federal match. The cost for HCPF to cover CGMs depends on the
number of additional eligible members under the bill, the increase in resource utilization, and
the availability of rebates.
The fiscal note assumes that:
all members with Type 1 diabetes, 30 percent of members with Type 2 diabetes, 20 percent
of members with gestational diabetes, and no members with problematic blood sugar are
eligible for a CGM under current law; Page 5
April 17, 2024 SB 24-168
of the remaining members with Type 2 diabetes, gestational diabetes, and problematic
blood sugar, about 64,000 members will become eligible for a CGM;
about 8.5 percent of newly eligible members will utilize a CGM;
75 percent of total expenditures will come from the pharmacy benefit, of which, 44 percent
of expenditures will be eligible for rebates, which are available in the same year as the cost is
incurred.
Based on these assumptions, an estimated 5,434 new members will become eligible for
coverage. Applying utilization costs and quantities of CGM-related equipment by currently
eligible members, including transmitters, receivers, and subcutaneous needles, costs are
anticipated to increase by $3.1 million per year, with FY 2025-26 costs prorated for a coverage
start date of November 1, 2025. See Table 3 for detail on net CGM costs to Medicaid after
accounting for rebates.
Table 3
Continuous Glucose Monitor Coverage Costs
FY 2024-25 FY 2025-26 FY 2026-27
Pharmacy Benefit - $2,345,348 $3,518,021
Durable Medical Equipment Benefit - $763,129 $1,144,693
Rebates - ($1,031,953) ($1,547,929)
Total CGM Costs - $2,076,524 $3,114,785
Savings. RPM and CGM services may reduce service costs to the extent that members who
currently seek in-person services become eligible and utilize telehealth services. CGM service
costs may also reduce to the extent that CGMs currently billed under the medical benefit will be
billed under the pharmacy benefit and become eligible for rebates. Cost savings may also be
realized from improved health outcomes. While the fiscal note does not estimate the potential
savings for HCPF, it is assumed that any savings that are realized will be addressed through the
annual budget process.
Legal services. HCPF may require legal services, provided by the Department of Law, which can
be accomplished within existing legal services appropriations. Legal counsel is related to
rulemaking, implementation, and ongoing administration of the programs.
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.
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April 17, 2024 SB 24-168
Other Budget Impacts
General Fund reserve. Under current law, an amount equal to 15 percent of General Fund
appropriations must be set aside in the General Fund statutory reserve. Based on this fiscal note,
the bill is expected to increase the amount of General Fund held in reserve by the amounts
shown in Table 1, decreasing the amount of General Fund available for other purposes.
Effective Date
The bill takes effect 90 days following adjournment of the General Assembly sine die, assuming
no referendum petition is filed.
State Appropriations
For FY 2024-25, the bill requires a General Fund appropriation of $98,703 to the Department of
Health Care Policy and Financing, and 0.8 FTE.
State and Local Government Contacts
Health Care Policy and Financing Personnel 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 the General Assembly website.