Hospitals are urging Colorado lawmakers to reconsider a proposal to cut about $50 million from a state program that helps teaching hospitals cover indirect costs associated with training resident physicians.
The proposal would reduce funding for Colorado’s Medicaid indirect medical education program by roughly $50 million. Because the funding draws federal matching dollars, the reduction also would result in the loss of additional federal support. The Colorado Senate passed a broader budget package that includes the proposed cuts in late February, according to reports from The Colorado Sun and The Daily Sentinel.
Indirect medical education funding helps hospitals offset costs associated with training physicians, including maintaining training infrastructure and equipment, as well as reduced patient volumes when attending physicians spend time supervising residents.
Hospital leaders have warned the cuts would shrink the state’s physician training pipeline, worsen existing workforce shortages and reduce access to care.
“We already have a shortage of doctors in general, pediatricians especially, so my greatest fear would be a decrease in the number of (people) who can train at Children’s Colorado, which, of course, would have a tremendous negative impact on access to pediatric care for Colorado,” Ben Hughes, MD, a pediatric pulmonologist and sleep physician at Children’s Hospital Colorado in Aurora, told The Daily Sentinel.
Each year, teaching hospitals in Colorado train about 1,800 medical residents. Aurora-based UCHealth trains roughly 1,200 residents annually and Children’s Hospital Colorado trains about 350, according to state data cited by the Sun.
Because the proposed cuts target larger hospital systems, UCHealth and Children’s Hospital Colorado are expected to see some of the largest funding reductions. State estimates suggest UCHealth’s University of Colorado Hospital could see a net funding reduction of about $18.1 million, while Children’s Hospital Colorado could face cuts of roughly $12.4 million.
If the proposal moves forward, UCHealth could consider eliminating about 208 resident full-time equivalent positions, which would translate to roughly 441 fewer physicians in training annually.
“There is no rational explanation for this,” Richard Zane, MD, chief medical officer at UCHealth, told the Sun. “It is such a generational decision that it’s not explainable.”
State officials say the proposal is necessary to address Colorado’s projected $850 million budget shortfall. The Colorado Department of Health Care Policy and Financing said the targeted reduction focuses on hospitals with greater resources while avoiding broader across-the-board cuts that would affect all hospitals.
“This proposal strikes a balance between the need for savings and minimizing the effect of budget reductions on hospitals with weaker finances,” the agency said in a statement to the Sun.
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