Hospital provider fee should be an enterprise fund

By James R. Briscoe


Dear Editor:

Attached is my letter to state legislators expressing my concern for supporting, promoting and maintaining the rural hospitals of Colorado, even in the face of TABOR limitations and demands for financing roads, schools, etc.


It saddens me to write this letter but will scare the hell out of me if I don't. We have been anxious about how your legislative actions might impact the hospital provider fee during the past legislative session and, now, in the 2017 session of the Legislature. The concern is regarding your focus on reducing Medicaid payments to hospitals in Colorado from the hospital provider fee so you stay within the TABOR monetary limits and still provide funding for other state-funded services.

As a director on the board of Delta County Memorial Hospital (DCMH) I am constantly reminded of how important it is to DCMH to receive the payments from the hospital provider fee it has historically received. DCMH is of paramount importance to the health and well-being of citizens of western Colorado and the main provider of medical services in Delta County, which has a very high number of persons who receive Medicaid or Medicare. The financial information the board receives every month from DCMH shows that approximately 75 percent of the revenue of the hospital comes from Medicaid and Medicare payments and only about 30 percent of the actual bills are approved for payment by Medicaid and Medicare. Obviously, it is very important, financially, for rural hospitals to receive some supplemental income from the hospital provider fee to serve Medicaid and Medicare patients and be able to keep the hospital doors open.

During the past year we have been proud to learn that three hospitals in Colorado were recognized as being in the top 100 rural hospitals in the nation, those being the Montrose Memorial Hospital, the Sterling Regional Medical Center and Delta County Memorial Hospital. It is the result of the hard work and dedication of the medical services providers at those hospitals that has earned the accolades. If your actions as elected officials result in a loss of income to the rural hospitals of Colorado there will certainly be closures of some of those hospitals, leaving the population in those areas without adequate medical services and causing the cost of medical services to go up even more. The purpose of the hospital provider fee is to enhance and increase the funds available to support and assist hospitals, particularly rural hospitals, with the cost of providing such services to Medicaid and Medicare patients. Without the extra aid from the hospital provider fee rural hospitals will need to reduce some medical services and will not be able to provide certain services at all. Some hospitals will eventually close, leaving those areas of the state without adequate medical services.

Often the hospital is the largest employer in the county, as is Delta County Memorial Hospital. If a hospital has to reduce the medical services it provides then the number of employees will be reduced, adversely impacting the economy in the area. If a hospital closes, a large number of the area residents become unemployed. As the CEO at DCMH has said, "(i)t is not likely that we will close in one year due to the amount of reserves we have wisely set aside, but it will be very difficult to survive beyond one year of cuts." The impact of the loss of payment from the hospital provider fee historically received will certainly damage all rural hospitals in Colorado and place some of them in jeopardy as to whether they will be able to remain open.

I recognize the need in the state for highway repairs/construction, for an increase in educational funding, but if the health and well-being of our citizens is at risk and medical services unavailable, or many miles away or unaffordable, then improved roads and expanded educational opportunities won't benefit them, particularly if medical providers are unemployed because of the reduction in medical services or closure of a hospital.

My plea to you is to recognize the paramount importance of rural hospitals in Colorado being financially able to provide medical services to citizens of the areas served and to maintain the hospital provider fee level of support. Make the hospital provider fee an enterprise fund in the 2017 session, but don't cut the payments to the hospitals.

If you are not persuaded by the importance of maintaining rural hospitals and holding off on funding other projects later, then consider that if the hospitals are not going to receive the benefits normally received from the hospital provider fee, those hospitals should not be required to pay into the hospital provider fee as they historically have. As an alternative, I suggest that, as our elected representatives, you pass legislation that amends, even temporarily, the hospital provider fee provisions so that the rural hospitals, which provide medical services to the larger percentage of Medicaid patients, continue to receive the financial benefits from the fund that they normally have.

James R. Briscoe
Paonia