Colorado Health Centers Face Crisis as Government Shutdown Continues

Community health centers in Colorado are confronting a financial crisis as the federal government shutdown disrupts funding essential for providing care to low-income residents. The federal community health center fund, which allocates approximately $111 million annually to Colorado clinics, lapsed at the end of September 2023. This funding is crucial for covering services for uninsured individuals, leaving many centers uncertain about their financial future.

Ross Brooks, president and CEO of the Colorado Community Health Network, highlighted the precarious situation. While centers can continue to access funds from existing grants, the duration of these resources varies. Some clinics may have up to six months of funding remaining, while others could see their resources depleted in as little as one or two months. Brooks stated, “I’m hopeful that the federal government’s going to come to a resolution on it. If it goes more than two to three months, I think we’re in a pretty tough spot.”

A prolonged shutdown could jeopardize additional programs supporting health centers, including loan repayment plans for doctors serving in underserved areas. The longest government shutdown recorded lasted 34 days from December 2018 to January 2019, raising concerns about the potential impact if the current stalemate continues.

Colorado’s community health centers operate approximately 250 sites, providing care to around 850,000 people in 2024. Donald Moore, CEO of the Pueblo Community Health Center, expressed concern that financial difficulties might arise sooner than anticipated. While his center is legally permitted to draw down reimbursement, there is uncertainty regarding whether employees at the U.S. Department of Health and Human Services are available to process these payments. The Pueblo center relies on about $5.4 million in federal funds each year, which constitutes roughly 15% of its overall budget.

During the shutdown, the Department of Health and Human Services has furloughed approximately two-fifths of its workforce. This reduction has led to delays in responses to media inquiries, complicating the situation for health centers seeking clarity on funding processes.

Despite traditionally enjoying bipartisan support, community health centers are facing challenges as Congress grapples with budget negotiations. Brooks noted that while Congress could potentially extend funding for community health centers independently, this scenario seems improbable. As of October 4, 2023, congressional Republicans and Democrats remain at an impasse. Democrats are advocating for a budget deal that includes enhanced tax credits for health insurance purchases, while Republicans insist on resolving broader government funding issues first.

President Donald Trump appeared open to discussions regarding tax credits but stated that negotiations could only occur after the government shutdown ends. With open enrollment for the individual marketplace set to begin on November 1 and coverage starting on January 1, the urgency to reach a resolution is increasing.

The president’s budget proposal includes cuts to the Health Resources and Services Administration, which is responsible for distributing federal funds to community health centers. Although the proposal does not specify which programs will be affected, Moore noted that these centers are already facing funding challenges, with increases lagging at 1.7% annually, falling short of the rate of medical inflation.

Looking ahead, the coming years will pose significant challenges, particularly with impending changes to Medicaid. Moore expressed concern that if patients lose Medicaid coverage due to new work requirements, they may continue to seek care at health centers without the ability to pay. The sliding fee scale at these centers often allows uninsured individuals to receive care for as little as a few dollars.

“If the uninsured numbers increase in the future, that’s the straw that can break the camel’s back,” Moore warned. Currently, about two-thirds of community health centers in Colorado are operating with negative margins, forcing them to dip into reserves or make difficult decisions such as consolidating clinics or freezing hiring.

Although no additional cuts have been made in response to the ongoing shutdown, Brooks indicated that health centers may have to consider such measures if funding does not materialize soon. Despite these challenges, the Pueblo center plans to continue treating patients, operating under the assumption that funding will eventually be restored following a budget resolution. Yet, if the shutdown extends for months, Moore fears the center may have to halt accepting new patients and could even close prenatal care clinics in rural areas of southern Colorado. “Hopefully, they won’t break their record,” he said, referring to the duration of the shutdown.

As the situation remains fluid, community health centers are left to navigate a precarious future, with their ability to serve vulnerable populations hanging in the balance.