Colorado’s health care providers — from rural medical centers to city hospitals to school programs — continued tallying Tuesday the potential damage of Bush administration-proposed cuts to Medicaid funds.
The estimated $157 million a year in cuts could be the state’s “own little Katrina,” said Patricia Gabow, chief executive of Denver Health, the city’s safety-net hospital.
“This is the most potentially devastating issue we have faced in more than three decades,” Gabow told the legislature Joint Budget Committee.
The White House last year proposed changes and $15 billion in cuts to Medicaid — a public health program for low-income people. Congress managed to postpone most cuts until this May or June, said U.S. Rep. Diana DeGette, D-Colo.
Monday, the U.S. House oversight committee released a report estimating potential losses to state programs at three times the White House estimate — $50 billion nationally, and a $787 million loss to Colorado over five years.
About 90 percent of the loss would come because new rules would no longer include Denver Health and University Hospital as “safety net” hospitals, which receive higher reimbursement from Medicaid because they treat more uninsured patients, DeGette said.
At Denver Health, about $60 million from the hospital’s $510 million annual budget would be lost if the rule changes go through, Gabow estimated.
Denver Health treated nearly 43,000 Medicaid patients in 2006 and more than 68,000 others in “charity care” programs for those with no insurance at all, said Denver Health spokeswoman Dee Martinez.
The rules could cut $30 million a year at University of Colorado Hospital, hospital chief executive Bruce Schroffel told the JBC.
Schroffel said that could lead to the hospital no longer serving indigent and underserved patients, except in the emergency room.
The proposal could have disproportionate impact on rural hospitals, said Russ Johnson, chief executive of the San Luis Valley Medical Center, a 59- bed hospital in Alamosa.
“Medicaid is our largest payer,” Johnson said. The medical center’s annual operating budget is about $50 million, Johnson said, with a margin of about $1.5 million annually.
At least 20 percent of that margin, possibly up to $1 million, would be eliminated in the proposal, he estimated.
“We’d be looking at cutting all kinds of services now provided: diabetes education, orthopedics, pediatrics,” said Johnson. “The only thing that would be covered would be emergency-room visits.”
Kim Erickson, a member of the Colorado School Medicaid Consortium, said the proposal also would eliminate $7 million annually in reimbursement to school-based Medicaid programs in school districts across the state.
