In the most recent fiscal year<\/a>, Colorado hospitals paid roughly $1.3 billion in fees and got back about $1.8 billion in payments, netting the industry a $500 million win. But some hospitals end up getting back less than they put in.<\/p>\n How this reallocation works depends in part on how a hospital is categorized<\/a> \u2014 whether it is grouped with state government-owned hospitals, private hospitals or other public hospitals. The state had classified Poudre and Memorial as \u201cnon-state government owned,\u201d but UCHealth disagreed and sued in state court to reclassify the hospitals as private.<\/p>\n Last month, a district court judge in Denver agreed, writing, \u201cBecause the court holds the hospitals are the sole owners and operators of Memorial and PVH (Poudre Valley Hospital), the court also holds Memorial and PVH were incorrectly categorized.\u201d<\/p>\n The state is considering whether to appeal the judge\u2019s ruling.<\/p>\n The lawsuit focused narrowly on technical arguments about federal law and rules. But the context is this: Both Memorial and Poudre don\u2019t currently benefit a lot from the provider fee system. Last fiscal year, Memorial netted<\/a> less than $1 million, while Poudre paid in about $12 million more than it got back.<\/p>\n UCHealth spokesperson Kelli Christensen wrote in an email that recategorizing the hospitals \u201ccould result in higher payments,\u201d but she added that it\u2019s not certain, given the complexities of the system.<\/p>\n UCHealth is Colorado\u2019s largest provider of services to Medicaid patients, and Memorial and Poudre treat more Medicaid patients than any other hospital in their respective regions, Christensen noted.<\/p>\n \u201cFollowing federal law and correctly classifying hospitals is important to ensure proper payments to hospitals that care for Medicaid patients,\u201d she wrote. \u201cAn incorrect classification can result in underpayments \u2014 and this hurts both the hospital and Medicaid patients.\u201d<\/p>\n State warns of consequences<\/strong><\/p>\n State officials say the court ruling could hurt other hospitals that treat a lot of Medicaid patients, namely the others categorized as non-state government owned public hospitals. This list includes Denver Health and a slew of small, rural hospitals operated by local hospital districts.<\/p>\n Nancy Dolson, the special financing division director for the Department of Health Care Policy and Financing, said pulling Memorial\u2019s and Poudre\u2019s contributions out of that pool and moving them over to the pool for private hospitals could shift $25 million to $50 million annually away from publicly owned hospitals.<\/p>\n \u201cWe need to really recognize the impact and harm that, in some circumstances, could be more than significant to our rural hospitals and Denver Health if this decision would prevail,\u201d Kim Bimestefer, the executive director of the Department of Health Care Policy and Financing, said in an interview.<\/p>\n 79% of hospitals benefit<\/strong><\/p>\n Of the 85 acute care hospitals listed in the most recent annual report for the Colorado Healthcare Affordability and Sustainability Enterprise \u2014 the entity within the Department of Health Care Policy and Financing that collects and redistributes the fees \u2014 67 received a net benefit last year.<\/p>\n The biggest beneficiaries were also some of the state\u2019s biggest providers of services to Medicaid members \u2014 Denver Health and UCHealth University of Colorado Hospital.<\/p>\n At the other end, there were 18 hospitals that received back less than they put into the system, with HCA HealthONE Sky Ridge at the bottom. The hospital paid in $24 million more than it got back.<\/p>\n Provider fee under fire<\/strong><\/p>\n The hospital provider fee could be up for big changes at the federal level.<\/p>\n A proposal by Republicans in the U.S. Senate, part of the under-construction version of the giant tax and spending bill, would cut how much states can charge in provider fees<\/a>, thus also limiting how much matching federal dollars they could draw down. (The version of the bill that passed the U.S. House would have frozen existing fee rates<\/a> in place.)<\/p>\n![\"\"](\"https:\/\/www.europesays.com\/us\/wp-content\/uploads\/2025\/06\/COVID-VACCINES_215.jpg\")
Colorado Gov. Jared Polis, left, points to the COVID-19 vaccine in a small vial as he watches as Gina Harper, a clinical pharmacy coordinator, reconstitutes a dose of the vaccine before it is administered to the first patients in Colorado at UC Health Poudre Valley Hospital on December 14, 2020 in Fort Collins, Colorado. (Pool photo by Helen H. Richardson\/The Denver Post)<\/p>\n
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The U.S. Capitol. (Photo by Adam Michael Szuscik, via Unsplash)<\/p>\n