Runaway Medicaid Spending Forces Colorado Toward Hard Choices

By: Nash Herman | Commentary, Complete Colorado

The legislature’s Joint Budget Committee (JBC) recently held a hearing with the Department of Healthcare Policy and Financing (HCPF), the Governor’s office, and Manatt, a healthcare consulting firm, to address the unsustainable growth of Colorado’s Medicaid spending.

Here’s a look at some of the highlights from the hearing.

Runaway spending

According to HCPF and the Governor’s office, General Fund spending on Medicaid increased at an average rate of 6 percent from fiscal year 2015-16 to fiscal year 2018-19. However, after the federal government windfall from COVID, General Fund spending blew up, growing at an average rate of 19 percent from fiscal year 2021-22 to fiscal year 2024-25.

Health care is rapidly crowding out most other spending, and is the primary driver of the state’s budget challenges, as those federal funds have since expired.

HCPF now accounts for nearly one-third of the General Fund and is also the fastest-growing department.

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