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UCHealth warns Medicaid shifts, unveils $442M North campus expansion
Summary
UCHealth Southern Region told Colorado Springs council its uncompensated‑care burden and federal reimbursement changes risk access across Colorado; the system plans a $442 million phased expansion at its North campus to add operating rooms, ED capacity and inpatient beds to ease trauma‑center strain.
UCHealth Southern Region President Lonnie Kramer told the City of Colorado Springs council on Monday that the health system is facing mounting financial pressure as Medicaid enrollment declines and federal policy changes shift reimbursements.
“University of Colorado Hospital sees more transfers than any other hospital,” Kramer said, describing transfers of specialized cases and noting a rise in uncompensated care. He warned that recent and proposed policy changes — including the work‑requirement elements of what Kramer called “HR 1” and a reduction in the hospital provider (Chase) fee — are likely to increase the number of uninsured patients and shrink funding available to safety‑net providers.
Why it matters: Kramer presented data showing a large increase in uncompensated costs in recent years and an estimate that 100,000–150,000 Coloradans could lose Medicaid coverage under the state’s proposed revalidation and work‑requirement approach. He said validating work requirements could require roughly $57 million in state investment for staffing and technology, and he cited an estimate that fee reductions could pull billions from statewide health funding.
Kramer highlighted service‑line volume at UCHealth Memorial — among the busiest emergency departments in the state — and described investments in virtual care and behavioral health that the system says have expanded access across Southern Colorado. "We now are providing primary and urgent care visits across Colorado Springs virtually," he said, pointing to an innovation center and about 2,000 virtual‑care patient contacts per day.
Capital plan: Kramer announced that UCHealth’s board approved a $442 million expansion of the North campus to address capacity constraints at the Level I trauma center, which has experienced occupancy above 100 percent at times. The initial scope will include four operating rooms to open, four additional shelled ORs, eight emergency department rooms, 50 inpatient beds and an estimated 200 jobs in the first phase. Kramer described the build as phased for the long term — “building for the next 25 years, not the next five.”
Council reaction and context: Council members raised questions about rural transfers, military births and regional capacity. Kramer and council members repeatedly framed the funding pressures as a combination of federal reimbursement changes and long‑term underinvestment in safety‑net finances.
Next steps: Kramer offered to meet with council members and invited site tours of UCHealth facilities, including the forensic center of excellence and virtual health operations. No formal action was taken; the presentation served as an informational briefing.
