Denver Health, Colorado’s primary safety net healthcare provider, is facing a significant financial crisis due to rising uncompensated care costs. With uncompensated care totaling $140 million last year, the health system is struggling to maintain its $1.4 billion budget. Denver Health CEO Donna Lynne has warned that without additional funding, the organization may have to make drastic cuts to services and defer vital maintenance to keep facilities operational.
To address these financial challenges, the Denver City Council has approved putting a 0.34% sales tax increase on the ballot for the upcoming election. If passed by voters, this increase would raise an estimated $70 million annually for Denver Health. The total sales tax rate, including the state’s 2.9% rate, would rise to 9.15%, providing much-needed funding for the struggling healthcare provider.
Denver Health has seen a significant increase in uncompensated care costs attributed to migrants transported to the city from the southern border. The Denver city and county government reported supporting over 42,000 migrants, costing more than $72 million. This influx of patients has further strained Denver Health’s already limited resources, making the proposed sales tax increase even more critical for the organization’s survival.
Founded in 1860, Denver Health became an independent entity in 1996, with the transfer of healthcare programs, services, and facilities to the state-created Denver Health and Hospital Authority. Over the years, Denver has provided annual funding to support the health system, but additional, reliable funding is now essential to meet the growing healthcare needs of the community.
Despite its financial struggles, Denver Health has received external financial support in the form of one-time funding from Colorado lawmakers and revenue bonds from Fitch Ratings and S&P Global Ratings. These funds have helped stabilize the organization’s operating performance and allowed for essential investments in facilities and services. However, the proposed sales tax increase remains crucial for long-term sustainability.
Denver Health’s financial challenges underscore the critical need for increased funding through a sales tax increase. Without additional support, the organization may be forced to make harmful cuts to services and maintenance, jeopardizing the healthcare access and quality for the community. The upcoming election will be a pivotal moment for Denver’s residents to show their support for the vital services provided by Denver Health.