Colorado received’t should claw again almost $60 million it paid to public hospitals, together with Denver Well being and greater than two dozen rural amenities, beneath a deal introduced Tuesday to finish the state’s court docket battles with UCHealth.
“We thank UCHealth for working with us to resolve this difficulty in a fashion that protects all Colorado hospitals,” Kim Bimestefer, government director of the Colorado Division of Well being Care Coverage and Financing, mentioned in a information launch.
UCHealth sued the division, alleging it had incorrectly labeled two of its hospitals as public, fairly than non-public nonprofits. A Denver District Court judge agreed, and ordered the state to reclassify Memorial Hospital in Colorado Springs and Poudre Valley Hospital in Fort Collins. The division filed an attraction in July.
Their classification issues due to the state’s supplier tax.
Hospitals pay about $1.3 billion every year, gaining about $500 million in federal matching funds. Most come out forward, although these with comparatively few sufferers lined by Medicaid lose out. In future years, the state should cut back its tax price beneath provisions of H.R. 1, colloquially often called President Donald Trump’s “massive lovely invoice.”
The state swimming pools the cash by hospital sort, and distributes it primarily based on how every facility’s Medicaid share compares to the others of their group.
Shifting Memorial and Poudre Valley from the general public to the non-public bucket signifies that much less cash stays for all public hospitals to divide up, and that Memorial and Poudre Valley seemingly will get extra again from the supplier tax, as a result of they’re being in contrast in opposition to hospitals that usually see fewer Medicaid sufferers.
The state mentioned that to retrospectively reclassify the UCHealth hospitals and distribute the funds accordingly, it must take again $59.7 million paid final yr to 29 publicly owned hospitals.
Denver Well being didn’t touch upon the likelihood, however a gaggle representing 13 Japanese Plains hospitals mentioned some wouldn’t be capable of hand over a big chunk of money, as a result of they already used their share of the supplier tax to pay staff and canopy different bills.
Below the settlement, the Division of Well being Care Coverage and Financing will drop its attraction, and UCHealth received’t demand redistribution of supplier taxes it paid in earlier years.
UCHealth president and CEO Elizabeth Concordia mentioned the system helps the supplier tax program, and thanked the state for working collectively on an answer.
“The best successes for sufferers and our state occur when hospitals, HCPF and the administration work collectively collaboratively,” she mentioned in a information launch.
The hospital system additionally agreed to donate $5.7 million to compensate public hospitals that will lose out with much less cash coming into their bucket. The Colorado Hospital Affiliation will assist decide methods to divide up the donation.
“Instability or uncertainty within the payment might have pushed weak hospitals previous the breaking level,” Jeff Tieman, president and CEO of the Colorado Hospital Affiliation, mentioned in a information launch. “UCHealth’s method to waive adjustments for final yr and make investments tens of millions this yr demonstrates an actual dedication to defending entry to care in rural Colorado. We’re deeply grateful for his or her partnership.”
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