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DENVER (CBS4) – Despite being consistently ranked one of the healthiest states in the country, Coloradans face some of the highest health care costs. A new report from the Department of Health Care Policy & Financing found Colorado hospitals are increasing the price of care while receiving significant increases in Medicaid payment rates.

The report found Colorado hospital per patient profits rose from $538 in 2009 to $1,518 in 2018. The cost of health care has also gone up. In 2018, Colorado hospitals’ operating expenses were 14 percent higher than the national average.

“Since we took office, this administration has been focused on lowering the cost of health care for all Coloradans,” said Lt. Governor and Director of the Office of Saving People Money on Health Care Dianne Primavera. “This report shines a light on the fact that hospitals are not passing along savings to Coloradans, but are instead making record profits on the backs of consumers. We have to ensure these savings will make their way into the pockets of hardworking Coloradans.”

In a statement, the Colorado Hospital Association said they are actively working on solutions to improve health care affordability in Colorado. The association said the issue exists because of chronic underfunding of state and federal public health care programs – namely Medicare and Medicaid.

“This report is distracting from the unintended, yet predicted, consequences of the state’s own policies,” stated the Colorado Hospital Association. “For example, the state’s reinsurance program – touted as saving consumers 20 percent on average – has also caused prices to increase for some consumers, and now the state is attempting to unlawfully force hospitals to pay $40 million one year early. This has the potential to endanger the care hospitals provide in some communities across the state.”

The report found hospital margins have increased by more than 280 percent between 2009 and 2018, from $538 to $1,518 per adjusted discharge, which reflect both inpatient and outpatient care.  Pricing at Colorado hospitals grew 71.3 percent between 2009 and 2018, which inpatient and outpatient care volume only grew 16.6 percent.

“Hospital costs represent the largest component of overall health care costs,” said Kim Bimestefer, the Executive Director for the Department of Health Care Policy and Financing. “This Department report reveals the drivers of rising hospital prices so policymakers and stakeholders can work together to ensure all Coloradans have access to affordable health care.”

According to the report, the amount of money hospitals lose annually due to bad debt and charity care has decreased by more than $385 million annually. The report credits the drop to the Hospital Provider Fee, Medicaid expansion, and the Affordable Care Act.

The Colorado Consumer Health Initiative said that the best way to reign in hospital and industry profits is with the implementation of a public option for coverage.

“The problem is that hospitals are raking in record-high profits while everyday Coloradans suffer from high health care costs,” said  Adam Fox, CCHI’s Director of Strategic Engagement. “Colorado hospitals enjoy the second-highest profits in the country, and this report shows why we need a public option that holds hospitals accountable and makes health coverage more affordable.

The full report can be viewed here and the executive summary can be read here.

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