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House approves $25M provider stabilization fund to aid safety-net clinics, with debate over use of unclaimed-property interest
Summary
The House passed Senate Bill 290 to create a provider stabilization fund that will make payments to safety-net health providers serving low-income and uninsured Coloradans, funded primarily by interest on the Unclaimed Property Trust Fund and designed to seek federal matching dollars.
DENVER — The Colorado House approved Senate Bill 290, establishing a new provider stabilization fund to deliver one-time stabilization payments to safety-net health providers, including federally qualified health centers, rural health clinics and behavioral health providers that serve low-income uninsured and publicly insured Coloradans.
Representative Byrd, a co-sponsor, said the pandemic and the Medicaid unwinding left many safety-net providers facing higher uncompensated care burdens because patients lost Medicaid coverage and clinics continued to provide care. She said the new fund would help clinics preserve access to services, retain staff and avoid closures.
Under the bill as passed, the primary funding source is interest earned on the state—s Unclaimed Property Trust Fund; sponsors described the mechanism as using interest only and said projected interest in the first year exceeds the initial distribution.
Opponents objected to using the Unclaimed Property Trust Fund—s earnings and argued the trust is already heavily committed to previous transfers and should not be used to seed a large new program. Representative Marshall offered an alternate amendment that would have instead seeded the program with $5 million reallocated from various economic development and tourism line items and created a refundable tax-credit incentive for private donations; that amendment was defeated.
Supporters said the bill is designed to be TABOR neutral and that the state would seek federal matching funds to extend the dollars. Representative Byrd said the fund includes guardrails on eligibility and creates an advisory process for awarding stabilization payments based on each provider—s volume of care for low-income uninsured Coloradans.
The House approved the bill after adopting technical and clarifying amendments in committee and on the floor. Sponsors and committee staff said payments would begin in fiscal 2025-26 and that the department would develop application and distribution procedures.
Why it matters: Safety-net clinics provide primary care, behavioral health and other services to residents with low incomes or no insurance. Multiple lawmakers said the bill was intended as an immediate stabilization measure while the state pursues longer-term systemic fixes.
