Colorado families are being told a “tsunami” is coming for healthcare. That is the word healthcare leaders are using as hospitals lose money, Medicaid reimbursements fall short of costs, insurance premiums climb and medical services disappear. And, right on schedule, everyone in charge has begun pointing at everyone else.
The Colorado Springs Gazette lays out a system already in serious trouble before the next round of federal Medicaid changes fully lands in 2027. Hospitals say government reimbursement does not cover the cost of care. Democrats blame the Republican-backed H.R. 1 budget law. Republicans point to years of Colorado mismanagement, regulation and exploding costs. Gov. Jared Polis says hospitals and insurers have plenty to answer for, too. Somewhere beneath this majestic festival of finger-pointing are ordinary Coloradans trying to figure out whether they can afford insurance, whether their hospital will still offer the service they need and why a system sold to them as increasingly compassionate keeps becoming increasingly expensive.
Remember when Obamacare was going to save us all? Bend the cost curve. Lower premiums. Expand affordable care. Happy days were supposedly one federal program away. Now even a Democratic socialist quoted in the Gazette calls Obamacare a Band-Aid, ACA premiums are climbing again, and one Democratic Colorado legislator says a family that had been paying about $500 per month can now face marketplace premiums above $2,000. Some rescue.
The Bullet Point Brief
- Colorado hospitals are flashing red. Nearly 75 percent ended 2024 with margins the Colorado Hospital Association considers unsustainable. Hospitals say Medicaid now pays about 67 cents for every dollar of care they provide, down from 80 cents five years ago and 85 cents a decade ago. Apparently losing money on every government-reimbursed patient is now a business model.
- Washington is about to turn the screws tighter. H.R. 1 changes Medicaid eligibility and imposes work or community-service requirements on certain able-bodied adults beginning by 2027. Democrats warn it will knock people off coverage and hammer hospitals. Republicans say it trims waste, restores personal responsibility and protects Medicaid for people who genuinely need it. Both sides have selected their preferred villain. Colorado families still get the bill.
- Colorado cannot credibly pretend this started yesterday. Medicaid spending in the state doubled from roughly $8 billion in 2015 to $16 billion in 2025 while enrollment returned to roughly its 2015 level, according to figures cited by Rep. Gabe Evans. The Gazette also reports that Colorado enacted 182 healthcare bills since 2019 that a Common Sense Institute analysis estimates added $858 million in annual costs. Apparently the cure for an expensive, complicated healthcare system was another truckload of expensive complications.
- The state left money sitting on the table while hospitals struggled. Colorado was late to pursue a Medicaid financing mechanism known as state-directed payments, which is now expected to bring hospitals more than $450 million. Former Democratic House Speaker Alec Garnett, now with UCHealth, said the delay “disproportionately set Colorado back.” When even the former Speaker is saying state policy cost Colorado dearly, perhaps “Washington did it” needs a few footnotes.
- This is already becoming painfully real outside Denver. Delta has eliminated labor and delivery services. Rural hospitals describe fixed operating costs that do not disappear when patient volume falls. Hospital leaders warn more closures, program cuts and eliminated services could follow. In rural Colorado, “healthcare policy” eventually means a longer drive when your wife is in labor, fewer doctors nearby and another service your community used to have.
My Bottom Line
Healthcare freefall is not a weather event. There is no healthcare hurricane forming mysteriously over Nebraska and drifting west. Somebody wrote the laws. Somebody set the reimbursement formulas. Somebody approved the mandates. Somebody built the insurance rules. Somebody decided which federal dollars Colorado would pursue and which it would leave sitting there. Somebody charged $2,000 for Tylenol and a Band-Aid. And a whole lot of somebodies have spent years telling us the next government intervention would finally make healthcare affordable.
That is what makes the finger-pointing so irritating. Democrats cannot simply yell “Trump” and erase years of Colorado policy choices that predate H.R. 1. Republicans cannot wave away legitimate questions about what new federal Medicaid rules will do to already-strained rural hospitals. Hospitals cannot complain about government payment formulas while pretending patients have not seen some utterly ridiculous bills. Insurers do not get to hide behind actuarial fog while premiums eat a larger chunk of family paychecks. Everybody wants accountability right up until the flashlight swings toward their desk.
And Colorado’s political class deserves particular scrutiny. This state loves wrapping public policy in the language of compassion. Every new mandate has a sympathetic name. Every expansion comes with a press conference about helping working families. Yet the end product is increasingly difficult to afford, increasingly complicated to navigate and, in some communities, increasingly difficult to find at all. Compassion measured by the number of laws passed is easy. Compassion measured by whether a working family can actually afford to see a doctor is apparently the advanced course.
Obamacare was supposed to bend the cost curve. It didn’t. Colorado layered on regulation, spending and promises. Costs kept climbing. Now the people who built, expanded, regulated, financed and administered this machine are standing around the smoking transmission arguing about who last changed the oil. Enough. Open the books. Name the mandates. Show the reimbursement math. Identify the administrative costs. Explain the tradeoffs. And for once, stop calling every warning light “progress” right up until the engine seizes.
Source: Colorado Springs Gazette