expects to lose more than $60 million annually — roughly the amount the city’s struggling safety-net hospital gained from a sales tax that voters approved last year — once federal Medicaid changes take effect in 2027.
CEO Donna Lynne recently told the that the hospital expects a $64.2 million annual loss, mostly because patients who currently have Medicaid will lose coverage, but keep coming for care.
“This is going to create a big problem for us,” she said.
Starting in 2027, people covered under the Medicaid expansion, which raised the maximum income to 138% of the poverty line, at least 80 hours each month.
The work requirement exempts people who are pregnant, “medically frail,” disabled veterans or parents of children under 14. In the few states that attempted to add work requirements, thousands of people became uninsured, including some who had jobs but struggled to navigate the paperwork.
providers would lose a combined $10 billion over five years due to provisions of Congressional Republicans’ tax-and-spending law H.R. 1, known as the “big beautiful bill.”
AdventHealth, CommonSpirit Health, HCA HealthOne and Intermountain Health said they hadn’t calculated the bill’s effects, but would work to protect vulnerable patients.
UCHealth said it hasn’t estimated an impact, because the state’s decisions could blunt or worsen the effects. Four of its hospitals are in the top eight Medicaid providers, by dollar amount of care provided, and all provide significant uncompensated care, spokeswoman Kelli Christensen said.
Children’s Hospital Colorado, which consistently ranks near the top of the state’s hospitals by share of patients covered by Medicaid, didn’t say what the cut’s financial impact could be, but said it could be “hugely disruptive” to children’s access to care in the state.
The city projects the sales tax Denver voters approved in 2024 will bring in about $65 million in its first year, though the amount could change, depending on whether economic conditions cause residents and visitors to spend more freely or to close their wallets. The tax adds 34 cents to a $100 purchase in the city.
The wording of the ballot question doesn’t allow Denver Health to simply replace any Medicaid revenue it loses with sales tax dollars. The tax proceeds must go to emergency and trauma care, primary care, pediatrics, mental health care, and addiction treatment and recovery services.
Denver Health roughly broke even in 2024, with about a 1% profit margin. It narrowly lost money in 2023, despite receiving $5 million from the state. It ended 2022 about $35 million in the red.
While patients becoming uninsured will have the biggest impact on hospitals, H.R. 1 also limited the “lookback period” to 30 days, Lynne told the council committee on Aug. 21.
If a person who is eligible for Medicaid, but not enrolled, gets care and enrolls within 90 days, the hospital or clinic that cared for them can get paid retroactively. Shortening that period will increase uncompensated care, because the state can’t always process the paperwork to determine someone is eligible within a month, she said.
Denver Health serves an unusually high number of people covered by Medicaid. In June, about 47% of patients had Medicaid as their insurance, and 10% were uninsured, Lynne said. Roughly one in 10 uninsured patients last year was a newcomer or migrant, she said.
The hospital system declined to discuss how it would close a new budget hole.
“Denver Health is committed to working closely with the state to mitigate some of these impacts on both us and our patients during this unprecedented time,” Denver Health said in a statement.
