New Report Shows Financial Burden Passed On To Privately Insured Coloradans

By Consumers For Quality Care, on February 13, 2019

Over a 9-year period, Colorado consumers could have saved $11.5 billion if hospitals contained costs and profit margins, The Associated Press reports. According to a new state report, hospitals charged patients with private insurance more, even as revenues increased.

In 2009, Medicare and Medicaid in Colorado paid 78 cents and 54 cents, respectively, for every $1 worth of care their patients received. Privately insured patients paid $1.55 for every $1 worth of care.

In 2017, Medicare and Medicaid had equalized, each paying 69 cents for every $1 in care in Colorado. But privately insured patients were now paying $1.66 for every $1 worth of care, according to the report.

Over the 9-year span, payments to hospitals increased from $9.5 billion to $15.7 billion while hospitals’ profit margins grew from $147 million to $1.2 billion. In 2017 alone, hospitals charged privately insured patients $1.2 billion more than was necessary to cover other losses.

The report states that one explanation could be that hospitals have not been passing on the benefits of Medicaid expansion and the Affordable Care Act to privately insured customers.

Colorado’s Department of Health Care Policy And Financing’s CFO, John Bartholomew, said that if hospitals had better “managed their costs, the cost shift could have been flat.”

“There was a choice,” said Kim Bimestefer, the executive director of Colorado’s Department of Health Care Policy and Financing, which administers Medicaid in the state and produced the report. “The strategic decisions were a big driver of where we are today.”

A spokeswoman for the Colorado Hospital Association denied that hospitals shifted higher payments on to privately insured patients. A report published by the association in January blamed a competitive jobs market and a high cost of living for the cost increases.