HB23-1243 ensures large, tax exempt hospital system community investment dollars are better aligned with the actual needs of the communities they serve
FOR IMMEDIATE RELEASE
May 10, 2023
Department of Health Care Policy & Financing
Denver, CO - Today Gov. Jared Polis signed HB23-1243 (prime sponsors Representative Judy Amabile and Senator Dominick Moreno) into law, which builds upon existing legislation to further increase nonprofit, tax-exempt hospitals’ transparency and accountability to their communities. This bill requires Colorado’s nonprofit, tax-exempt hospitals to better engage the communities they serve in determining how they spend community benefit dollars. In the Department of Health Care Policy & Financing (HCPF’s) 2023 Hospital Community Benefit Accountability Report, hospitals spent 7% of their patient revenues or $965 million in community benefit investments. Such contributions are significant and valued. Through HB23-1243, communities will now have more say in where those investments are made.
In exchange for their tax exemption, nonprofit hospitals are federally required to provide community benefit investments. Like the current Colorado law, HB23-1243 does not affect Colorado’s 32 critical access hospitals in rural and frontier communities.
“House Bill 23-1243 strives to ensure that the local community voice is reflected in hospital community investments while the reporting provisions verify that alignment going forward,” said HCPF Executive Director Kim Bimestefer. “The bill will better leverage the hundreds of millions in hospital community benefit dollars to improve the health and well-being of Coloradans, tailored to the unique needs of each community.”
HB23-1243 increases transparency by requiring more detailed reporting on how and where community benefit dollars are invested and how that relates to the community voice. As an example, HCPF’s 2023 Hospital Community Benefit Annual Report found that communities across the state overwhelmingly want hospitals to invest in behavioral health services. In fact, 95% of hospitals’ Community Health Need Assessments included behavioral health as a priority. Yet, under current reporting, HCPF does not have enough information to understand if that level of investment in behavioral health is happening. By requiring more specific reporting from hospitals, this bill closes that information gap to improve transparency and accountability.
HB23-1243 accomplishes five main objectives:
- It requires hospitals to provide more specific and detailed spending information, so policymakers and communities across the state can tell what activities and initiatives are being funded, and how those initiatives compare with what the community asked for.
- The bill requires the hospital to solicit, consider, and provide the community the opportunity for feedback in creating their community benefit spending plan and any changes to spending priorities, improving on the current annual public engagement process.
- The bill expands requirements for HCPF to undertake stakeholder work to develop community engagement best practices and efficiencies.
- The bill includes the calculation of the value of the nonprofit hospitals’ tax exemption. Colorado’s communities need sound estimates of the value of the tax exemption to understand the value of hospitals’ community benefit spending in lieu of paying taxes.
- The bill adds reasonable non-compliance measures.
The bill takes effect in August 2023.
About the Colorado Department of Health Care Policy & Financing: The Department administers Health First Colorado (Colorado's Medicaid program), Child Health Plan Plus, and other programs for Coloradans who qualify. These health care programs now cover about one in four Coloradans. For more information about the Department, please visit hcpf.colorado.gov.