Budget committee backs staff plan to limit parts of Cover All Coloradans amid $207.6M forecast gap

The Joint Budget Committee on (date) adopted staff recommendations to constrain portions of the Cover All Coloradans program after staff warned a new February forecast added roughly $207.6 million in general fund pressure across FY25-26 and FY26-27.

Mr. Kurtz, a budget staff analyst for the Department of Health Care Policy and Financing, told the committee the February medical forecast came in higher than the governor’s November request — $69.7 million more in FY25-26 and $137.6 million more in FY26-27 — leaving the committee with a multi-year shortfall. To reduce exposure, staff recommended sponsoring legislation to change statutorily defined eligibility and benefits for Cover All Coloradans because “the benefits are defined in statute” and a bill is required to change them, Mr. Kurtz said.

Staff proposed multiple changes: stop enrolling new people into certain long-term services and supports (LTSS) beginning after the current fiscal year, remove children from the Accountable Care Collaborative (ACC) while keeping pregnant people in ACC to preserve access and federal match, move some behavioral health capitation payments to fee-for-service, and either cap or eliminate dental benefits for the Cover All Coloradans population. The staff analysis shows the program’s actual expenditures far exceed the original fiscal note for the bill that authorized these benefits, and that growth has accelerated since implementation.

Committee members pressed staff on tradeoffs. Several members said they were uncomfortable eliminating dental coverage entirely; others emphasized the need to preserve prenatal care and coordination for pregnant people because of complexity and federal match rules. Staff responded that children’s coverage is fully state-funded (no federal match) while pregnant people receive a CHIP match (about 65 percent federal), which influenced the recommendation to keep pregnant people in ACC.

Vice Chair Bridges moved a package adopting department recommendations with staff modifications: accelerate the implementation timeline where feasible, grandfather current LTSS recipients while stopping new enrollments, require a service-cap approach for grandfathered cases to limit growth, and retain pregnant people in ACC. The motion passed without recorded objection.

The committee asked staff to return with precise implementation language, cost estimates for the proposed caps and grandfathering approach, and technical details on systems changes; staff noted coding changes to CBMS and billing systems would be required and estimated about $3 million in system costs to accelerate implementation in the near term. The committee also instructed staff to draft the bill that would be necessary to make the statutory changes.

The committee’s action is procedural direction to draft legislation and adopt staff recommendations for budget balancing; no final statute or appropriation was enacted during the meeting. The committee scheduled follow-ups to refine timelines, caps, and savings estimates before final budget votes.