Colorado patients shouldn’t bail out larger hospitals

High-quality and affordable health care is out of reach for most working families — and as patient costs increase, so do hospital profit margins.

Colorado hospitals, especially the large hospital systems, saw historical growth in net patient revenues, which grew more than $1.1 billion a year from 2014 to 2021.

Just in 2020 and 2021, net patient revenues increased 10.2% or over $1.8 billion, not including the $1.2 billion in federal stimulus that Colorado hospitals received.

In 2020, Colorado hospitals overall had the nation’s seventhhighest profit per patient, as well as the nation’s sixth-highest total profit.

To be clear, there’s a significant difference between many of Colorado’s rural hospitals, which operate at lower costs with thinner margins, and big systems, which have consolidated and expanded. Although major corporate systems such as Healthone and Uchealth — while technically “nonprofits” — are raking in billions, they are quick to point to rural hospitals as an excuse for their high charges and profits.

Perhaps CEOS of big hospital systems have lost sight of the vital role hospitals play in our communities and instead they continue to put profit over patients. That’s no surprise when the average hospital CEO rakes in more than eight times that of hospital workers, a gap that is increasing. In fact, the CEO of Banner Health makes $11.2 million, and the CEOS of Centura Health and SCL Health make $3.1 million and $1.8 million, respectively. That’s more money than most Coloradans will see in their lifetimes

All this at a time when too many families are drowning in medical debt and squeezed to pay more.

Despite record revenue and high salaries for executives, major corporate hospital systems have been gambling with those profits. Hospitals now say they’re in a financial bind because of their own risky investment choices. They got greedy and put their money into Wall Street.

Most of Colorado’s big hospital systems are considered nonprofits, but are they really acting that way? As nonprofits, their surplus revenue and putting profits in the stock market come at the expense of taxes that would otherwise be paid, funds that could be better invested at the community level or to help struggling rural hospitals.

For example, Uchealth reported a $157.5 million loss in the quarter ending Sept. 30, following a whopping $1.2 billion in investment gains in 2021. Children’s Hospital claimed a $180 million loss that resulted in an overall

$82 million loss for the first nine months of 2022. Big hospitals claim their 2022 losses are putting a strain on them, but that belies the years of excessive profits and revenue they’ve earned from increasing charges on Coloradans and years of massive investment gains.

Let’s be clear: They chose to put the profits that they made from patients into the stock market. They lost money for part of 2022, and now they cry poverty, even as the market and their stock portfolios recover.

It’s also important to note how much hospital systems benefit from their nonprofit status. Nearly $1 billion Colorado hospitals save in lieu of paying taxes that are supposed to benefit communities they serve, dollars that could be used to make services more affordable instead of charging higher costs or adding surprise out- of-pocket fees to your bill

Big hospitals are not telling the full story of how they dug themselves into the losses they are claiming. If the past is any guide, they will now use this to raise prices and charge exorbitant, vague, and unexpected fees — and continue charging hidden and arbitrary “facility fees.”

Hospitals are supposed to be in the business of healing, saving lives and serving their communities, not increasing costs to patients to pad their bottom line or to make up for losses in the stock market.