Colorado hospitals are facing a deepening financial crisis as nearly 70 percent operate on margins too slim to support long-term stability. The Colorado Hospital Association’s recent industry update, released on October 28, 2025, paints a stark picture of rising costs, uninsured patient surges, and federal policy shifts threatening the state’s healthcare system.
CHA Report Highlights Growing Fiscal Pressures
The Colorado Hospital Association’s Q2 2025 Colorado Hospital Industry Update details how hospitals statewide are grappling with narrow operating margins that limit investments in staff and equipment. Officials note that these challenges stem from a mix of economic pressures and policy decisions at the federal level.
For instance, charity care demands have spiked, with hospitals providing over $141 million in uncompensated services during the first quarter of 2025 alone. This trend continues as more patients seek help without insurance, straining resources in both urban and rural areas. Tom Rennell, a senior vice president at the association, explained that such financial squeezes force tough choices on service offerings, potentially reducing access to essential care.
The report also points to workforce strains, where economic tightness affects not just patients but hospital employees who are part of local communities. As costs rise for supplies and labor, hospitals find it harder to maintain competitive wages or expand services.
Federal Policies Fuel the Healthcare Crunch
Recent federal legislation, including the One Big Beautiful Bill Act signed into law on July 4, 2025, has exacerbated Colorado’s hospital woes by slashing more than $10 billion in funding over five years. This H.R. 1 measure is projected to strip Medicaid coverage from over 100,000 Coloradans, leading to higher uninsured rates and greater reliance on emergency services.
In addition, the termination of $250 million in federal funding for public and behavioral health programs in March 2025 has rippled through the system. These cuts, tied to the end of pandemic-era supports, have left gaps in crisis resolution teams and substance use recovery services, pushing more individuals toward hospital emergency departments.
Experts warn that without swift intervention, these policies could trigger widespread service reductions. For example, some facilities have already closed emergency rooms or maternity units to cut losses, a pattern seen in recent months across the state. This aligns with broader national trends where Medicaid reductions threaten rural access, but Colorado’s situation feels particularly acute given its diverse geography and growing population.
Surge in Uninsured Emergency Visits Alarms Experts
Emergency departments in Colorado treated around 15,000 uninsured patients in May 2025, marking a 20 percent increase from pre-pandemic levels and a 50 percent jump from during the COVID era. This rise correlates with ongoing Medicaid disenrollments, where over 500,000 people lost coverage in the past 18 months due to the unwinding of emergency protections.
Hospitals now screen more patients for eligibility, but many still end up billing charity care or absorbing costs from under-reimbursed government programs. Rennell highlighted how federal changes could accelerate this trend, with more community members facing economic hurdles that delay preventive care and lead to costlier emergency interventions.
To illustrate the scale:
- Uninsured ED visits in May 2025: 15,000 patients
- Increase from pre-COVID: 20 percent
- Projected Medicaid losses from H.R. 1: Over 100,000 Coloradans
- Charity care provided in Q1 2025: $141 million
These numbers underscore a system under duress, where frontline workers juggle higher volumes amid budget shortfalls.
Rural Facilities Bear the Brunt of the Crisis
Rural Colorado hospitals face even steeper challenges, with over 80 percent operating on unsustainable margins. These facilities often serve vast areas with limited resources, making them vulnerable to federal cuts and rising operational costs.
In recent years, several rural sites have shuttered key units, such as emergency rooms in remote counties, due to hemorrhaging funds on Medicaid patients. The association’s data shows that while urban hospitals like those in Denver manage through higher volumes, rural ones struggle with lower patient throughput and higher fixed costs.
A comparison of hospital performance highlights the disparity:
| Category | Urban Hospitals Unsustainable Margins | Rural Hospitals Unsustainable Margins | Key Challenge |
|---|---|---|---|
| End of 2024 | 65% | 78% | Rising supply costs |
| Q2 2025 | 70% | 82% | Uninsured visit surges |
| Projected 2026 | 75%+ | 85%+ | Medicaid coverage losses |
This table reveals how rural areas risk losing vital services, potentially forcing residents to travel hours for care. Community leaders in places like Grand Junction express fears over job losses and reduced healthcare access, tying into statewide economic concerns.
Looking Ahead: Calls for Stability and Support
As open enrollment approaches on November 1, 2025, worries mount over health insurance premiums set to double in 2026 due to unextended federal subsidies. This could leave up to 75,000 more Coloradans uninsured, further burdening hospitals already at a breaking point.
The Colorado Hospital Association urges lawmakers and stakeholders to safeguard funding and explore state-level protections. Recent legislative efforts, like Medicaid optimizations in the 2025 session, offer some relief, but experts agree more action is needed to avert closures and ensure equitable care.
In light of these developments, similar to past crises like the 2024 budget gaps that led to provider pay freezes, Colorado must prioritize sustainable reforms. Readers dealing with healthcare access issues can explore local resources through state exchanges, but sharing experiences in comments below could help build awareness and push for change. What are your thoughts on these hospital struggles, and how has it affected your community, share and comment to keep the conversation going.
