Jesse Paul at The Colorado Sun reports that Colorado is stuck in a loop of roughly one billion dollar annual budget shortfalls, with Medicaid growth as the main driver. The Joint Budget Committee’s top staffer called the trend alarming and warned the shortfalls will keep coming. The governor proposes to slow Medicaid growth next year, while lawmakers argued over whether to cut, reform, or go hunting for new revenue.
The Sun recounts an exchange where Rep. Rick Taggart pressed the administration about deeper administrative cuts. Budget chief Mark Ferrandino said even a ten percent trim in operations would free up about two hundred million dollars, which would not fully cover Medicaid’s growth. The JBC chair mused about finding a way to raise more revenue, which in plain English means another run at your TABOR refunds.
The Bullet Point Brief
- Same movie, new year. Roughly one billion dollars in red ink driven by Medicaid trend. The one-time fixes are drying up.
- Polis team wants Medicaid up about five to six percent instead of twelve. The fight is what to change, not whether costs are rising.
- Taggart asks for bureaucracy cuts. Ferrandino calls two hundred million a drop in the bucket. Out here, that is a nice bucket.
- JBC chatter about more revenue means TABOR is back in the crosshairs. Guardrails matter when the car is swerving.
- Before touching TABOR, trim optional Medicaid. You start where the law gives you the most room.
My Bottom Line
Thank God for TABOR. Under one party rule, it is the last working brake on the state’s spending habit. When the JBC chair says we need to find a way to raise more revenue, that reads like shake the taxpayers again. Families feel inflation too. In my house, Julie and I cut restaurant nights from three or four a week to once a month. That helps our budget but it hurts local restaurants. Government should learn the same discipline.
Here is where to start: optional Medicaid. Federal law sets mandatory benefits like hospital, physician, and EPSDT for kids. States choose the rest. Colorado has layered on many optional benefits and expansions. Trim there first.
• Adult dental. Colorado removed the annual cap in 2023. HCPF now proposes to re-cap adult dental at three thousand dollars per year. That change saves the General Fund about two hundred fifty thousand in FY 2025 to 2026 and about 1.6 million in FY 2026 to 2027. Cap it and keep basic prevention, not unlimited bills.
• Coverage regardless of immigration status. HB22-1289 opens full Medicaid or CHP+ style coverage to children and pregnant people regardless of immigration status beginning January 1, 2025. The fiscal note projected state costs growing to about 15.2 million General Fund for services by FY 2025 to 2026 and total service costs of about 34.9 million. News reporting indicates real costs are spiking beyond early expectations as migrant numbers climb. Freeze enrollment growth, limit non-emergency add-ons, and hard-cap spending. (Colorado General Assembly)
• Gender-affirming care. Colorado Medicaid covers gender-affirming services by rule. The 2025 bill to codify that coverage required no new appropriation because the benefit already exists. If lawmakers want savings, focus on strict medical-necessity reviews, prior authorization, and surgical site-of-service rules; do not expect big line-item savings overnight. (HCPF)
• Non-emergency medical transportation. NEMT is optional and currently includes mileage reimbursement and even air and train travel in some circumstances. Tighten criteria to in-state, least-cost medically appropriate options and audit the broker model. Savings come from fraud control and tighter medical necessity. (HCPF)
• Adult vision, eyeglasses, hospice expansions, PT, OT, speech therapy, prosthetics, and prescription drugs are optional categories Colorado has authorized. Prescription drugs are a large spend but also bring rebates. Use a tougher preferred drug list, step therapy, and inflation penalties before cutting care. (Colorado General Assembly)
• Waiver services and in-home supports. Home and Community Based Services are optional but often cost less than institutions. Average waiver costs for adults with disabilities run about sixty nine thousand per member annually versus about one hundred three thousand in facilities. Do not slash waivers blindly or you pay more later. Instead, pause non-urgent new enhancements, consolidate admin, and attack waitlist management costs. (HCPF)
Reality check on two hot buttons. Abortion is not a budget driver in Colorado Medicaid. By rule and statute, coverage is limited to life endangerment, rape, and incest. Broader public funding is not allowed, so there is little to cut. Gender-affirming care exists, but the 2025 codification had no new fiscal note because HCPF already pays under existing rules. Savings there will be administrative, not headline numbers. (HCPF)
Now, do the basic blocking and tackling. Freeze new optional expansions. Cap adult dental. Tighten NEMT. Put a hard governor on Cover All Coloradans costs. Use pharmacy tools. Chase fraud and improper payments. And yes, take the two hundred million in administrative trimming that the governor’s shop waves away. It may not fix a billion dollar hole, but adults start by cutting what they can cut. Protect TABOR. Respect taxpayers. Shrink government. Use technology that actually works. Regulate less. Charge fewer fees. Then do something radical. Try cutting taxes.
Source: The Colorado Sun
