The Colorado Department of Health Care Policy & Financing released three hospital transparency reports covering fiscal years 2014 through 2021.
New analyses of Colorado hospital costs, prices and profits show overall hospital patient revenues have grown faster than operating expenses, leading to growing profits and margins. Specifically, from 2018 through 2020, Colorado hospitals were ranked in the Top 10 nationally for each of the costs, prices and profits metrics tracked. While each of the metrics is moving in the right direction overall, the report illustrates that specific hospitals could be making far more impactful strategic decisions to reduce their prices to the betterment of the communities they serve.
The Hospital Expenditure Report analyzes major hospital financial metrics such as patient revenue, uncompensated care and operating expenses over the fiscal years 2014 through 2021. It shows Colorado hospitals saw historic growth in net patient revenues, which grew $1.105 billion, an average of 7.3% each year, between 2014 and 2021.
Hospital mergers and acquisitions over the last decade have generated ‘mega-systems’ across Colorado. These systems have amassed billions in reserves – the result of higher than necessary prices paid by patients and employers year over year. The report illustrates that for many hospitals, reserves are generating profits equal to or greater than patient service margins.
The reports also illustrate a stark contrast between the financial performance of Colorado’s large hospital systems to many rural hospitals, independent hospitals, and the state’s primary safety-net hospital system, Denver Health, which have persistently struggled financially. The report recommends continued investments in rural hospitals and policies that help rural hospitals better meet the needs of the communities they serve.
The Colorado Hospital Community Benefit Annual Report found that communities across the state overwhelmingly want hospitals to invest in behavioral health services. However, the hospitals’ reported information lacked sufficient detail to understand exactly how community investment dollars are being spent and whether the hospital community benefit investments decisions match the needs identified by their communities.
The Colorado Healthcare Affordability and Sustainability Enterprise (CHASE) Annual Report shows that Medicaid has increased its reimbursement to hospitals, reduced the number of uninsured Coloradans by half, and reduced their uncompensated care costs and the related need to shift public program underpayments to private insurance.
Together, the three reports provide Colorado lawmakers, policy makers, employers, advocates and residents transparent analysis based on hospital reported data to inform initiatives that improve Colorado’s health care delivery system and drive affordability. The reports and analyses are annual and required by the Colorado General Assembly.
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Colorado Department of Health Care Policy & Financing Reports: