Hospitals are a vital community resource

Hospitals are a vital community resource, providing both patient care and economic support that sustain and enrich our lives. As the heart of 24/7 healthcare, hospitals deliver crucial emergency and specialty services that can mean the difference between life and death. Facilities such as Neonatal Intensive Care Units (NICUs), burn units, and in-patient psychiatric care are indispensable, making hospitals the only sites capable of offering such unique and life-saving services.

Hospitals are more than just places for patient care; they are engines of innovation, workforce training, and community vitality. They serve as the primary sources of care in rural and underserved communities, ensuring that healthcare reaches every corner of our state. This commitment to care and innovation is reflected in the trust they garner. A significant 72 percent of Americans trust hospitals, compared to just 56 percent for government agencies, 34 percent for pharmaceutical companies, and 33 percent for insurance companies. Additionally, nine out of ten patients report satisfaction with their hospital care, underscoring the critical role hospitals play in our communities.

Hospitals are pillars of the local economy. In Colorado, hospitals provide more than 86,000 jobs, representing nearly 8 percent of all jobs in the state. In 2022 alone, they made almost $2 billion in community investments. Vail Health, for example, has provided more than $137 million in community benefits between 2019-2023 and has committed more than $200 million to behavioral health efforts.

Despite their indispensable role, hospitals are facing mounting financial pressures largely beyond their control. Issues like low reimbursement rates, staffing shortages, low patient volume, and regulatory barriers are widespread. Consequently, many hospitals are operating at a net loss. The cost of providing care has skyrocketed, with Medicare reimbursement rates failing to keep pace, covering only 82 cents for every dollar hospitals spend on patient care. Additionally, large corporate insurance companies exacerbate financial strains through denials, delays, and red tape, leaving hospitals to bear even more costs.

In Colorado, these issues are acute. Hospitals have seen labor and supply expenses grow by more than 30 percent since 2019, with over 70 percent of the state’s hospitals reporting unsustainable margins, most of which are in rural areas. The consequences of these financial pressures are dire. Since 2010, 136 rural hospitals have closed, forcing patients to travel long distances or forgo care entirely. These closures not only impede access to essential healthcare but also have significant economic ramifications. Jobs are lost, demand for local goods and services diminishes, and potential residents and businesses look elsewhere, weakening the economic fabric of these communities.

Compounding these challenges, corporate insurance companies advocate for further cuts to hospital reimbursements through legislation like The SITE Act and FAIR Act. Such "site-neutral" policies would significantly reduce the funds hospitals receive for providing care, exacerbating the financial strain and pushing more hospitals toward closure. At a time when hospitals are already struggling, further cuts to patient care are untenable.

The situation is unsustainable, and immediate action is necessary to strengthen our hospitals. Hospitals are working to mitigate these issues through innovative solutions, and policymakers must step up and provide the resources needed to ensure hospitals can continue to provide care and employment. This includes rejecting further cuts to patient care proposed by legislation such as the SITE Act and FAIR Act.

Protecting access to care, bolstering local economies, and supporting rural communities requires a concerted effort to strengthen and support our hospitals and health systems. Hospitals are doing their part; it’s time for policymakers to do theirs.

Chris Romer is president & CEO of Vail Valley Partnership, the regional chamber of commerce. Learn more at VailValleyPartnership.com