Colorado hospitals call for the state to address Medicaid issues

In an open letter to the Polis Administration and the Department of Health Care Policy & Financing (HCPF), 47 Colorado hospitals made a joint request that the state address what they call, “significant problems that Colorado’s hospitals and patients are facing with the state’s Medicaid office.” 


Get the latest state-specific policy intelligence for the health care sector delivered to your inbox.


The joint group of hospitals and health systems who sent the letter are concerned that new policies enacted by HCPF may make it more difficult for people to stay enrolled in Medicaid. The letter cites an 8 percent drop in Colorado Medicaid participants compared with 2.3 percent for the rest of the country — to make its case that Medicaid patients are increasingly at risk due to issues the HCPF has neglected to address. 

There are 6 specific issues cited the group has asked the HCPF and the Governor’s Office to help correct: 

1. HCPF’s new system of prior authorizations and concurrent reviews: The group says that the system “delays patients’ surgeries and admissions for urgent health care needs by a week or more. In some cases, patients’ outcomes are poorly impacted by HCPF’s delays.”

 2. Data transmission: The HCPF requires manual upload or faxed information, which the group calls “antiquated, time-consuming and expensive”, forcing hospitals to hire additional employees to deal with the administrative burden. 

3. Payment claim denials: Despite prior authorization for a surgery or inpatient stay, according to the group, Colorado Medicaid may still incorrectly reject patients’ claims for payment, forcing them to grapple with a backlogged appeals process. 

4. Claim denials for patients: placed in observation over 48 hours: For patients placed in observations over 48 hours, the group asserts,“tens of thousands of claims have been erroneously denied since 2017, and hundred of patients’ accounts still have not been corrected.” 

5. Billing responsibility: The group mentions a back and forth cycle wherein the HCPF defers billing responsibility for behavioral health patients to behavioral health organizations who then refuse responsibility, stating the HCPF is responsible. 

6. Drug cost reimbursement: Due to HCPF’s unwillingness to reimburse hospitals for the cost of the drugs they administer to patients, the group cities losses that exceed $30 million in total for hospitals. To remedy this issue, the group wants the state to reimburse at 100 percent of the 340B  acquisition cost, a move that is consistent among state Medicaid programs with high-cost drug policies. 

The group has asked that HCPF and the Governor’s Office work with them to ameliorate the above issues within 90 days.