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New Colorado law to help insure 67,500 more

Jennifer Brown
The Denver Post
Vail, CO Colorado

Colorado can afford to add about 67,500 people to Medicaid and other government insurance next week, thanks to a new state law that requires hospitals to chip in toward the landmark initiative.

Hospitals made their initial payments – and in return, received more state and federal cash to take care of needy patients – this month. The amount each hospital paid was worked out through a complicated formula that left some hospitals in the hole and others millions of dollars ahead of where they were before the new law.

The state Department of Health Care Policy and Financing released a list of hospital winners and losers at The Denver Post’s request.



The point of the Health Care Affordability Act, considered Gov. Bill Ritter’s most significant health care reform, is to create a pot of money through hospital fees that would draw matching federal money. The state is using the additional money – expected to reach $1.2 billion annually – to provide more Coloradans with health insurance, as well as pay back hospitals for treating patients who are either uninsured or on Medicaid.

In basic terms, the hospitals that treat the highest number of needy patients will benefit most from the 2009 law.



Denver Health Medical Center, for example, will pay $12.3 million in fees this year but come out $16.5 million ahead after collecting $28.8 million from the state pot and matching federal money, according to state data. The hospital, near downtown Denver, recorded more than 47,000 “Medicaid days” in 2007, a tally of Medicaid patients who stay 24 hours.

University of Colorado Hospital, which had more than 26,000 Medicaid days, will come out $2.2 million ahead this year.

“Trying to limit losers”



Some hospitals, however, didn’t fare as well under the new system.

Centura Health’s Adventist hospitals – Porter, Avista, Littleton and Parker – will lose a combined $6.3 million through the hospital fee. Still, the 12-hospital Centura system comes out winning, with a net gain of about $4.4 million.

“The state did a very nice job of trying to limit the losers,” said Randy Safady, Centura’s chief financial officer. “We have a number of losing hospitals and we have a number of winning hospitals.”

The “losing” hospitals, the ones that don’t see as many Medicaid patients, are mainly in suburban areas. “It’s geography,” Safady said. “It’s the demographics of those communities.”

Denver Health chief financial officer Peg Burnette said her hospital might have made “deep cuts” in its primary care, cardiology, dermatology or psychiatric programs this year without the influx of money. The hospital expects to spend $365 million in 2010 carrying for indigent and uninsured patients. And Denver Health’s Medicaid reimbursement from the state was cut about $23 million last year, Burnette said.

The new fee “helps us continue to see these patients,” she said. “We are seeing more uninsured patients because of the current economy.”

The state’s formula for dispersing funds takes into account not only the number of needy patients treated, but the size of the hospital, whether it’s rural or urban, whether it takes the sickest of infants and whether it’s a teaching hospital, said Chris Underwood, the Department of Health Care Policy and Financing’s director of state programs and federal financing.


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