Colorado Mental Health Centers Struggling After Medicaid Rollout

DENVER — Colorado mental health centers are trying to adjust to a massive loss of funds after American Rescue Act funds expired. Falling Medicaid funding has led to sharp declines in enrollment, leaving many Coloradans uninsured.

State data shows 1.8 million people are covered by Medicaid during the pandemic. After re-evaluating eligibility criteria, the state believed that about 300,000 Coloradans would lose enrollment. However, more than 600,000 Coloradans were excluded from the system.

Changing eligibility standards resulting in loss of coverage has been called a Medicaid “rollback.” Most of those who lost insurance exceeded the Medicaid income limit. A single person’s annual household income in Colorado to qualify for Medicaid must be below $20,030 and $41,496 for a family of four.

“We started hearing stories from people we serve who were losing Medicaid and struggling to meet their health care needs,” said Dr. Kiara Kuenzler, president of the Jefferson Center, a mental health facility.

Due to promotion, the center had to make significant cuts. The Jefferson Center announced last month that it would lay off 25 employees, mostly in administrative and clinical positions.

“At a time when behavioral health is needed more than ever before, it is devastating to see the impact in Colorado,” Kuenzler said.

Jefferson Center the company now has more than 6,000 customers without insurance, and they are not alone.

WellPower, A Denver-based psychiatry group has had to cut more than 100 jobs. The group also ended its virtual therapy program and ended its lease on Garfield House, an apartment complex that helped patients in need of housing. WellPower President Dr. Carl Clark said the virtual therapy program has helped 600 people.

“We are one of the top 10 states in the country where people have lost Medicaid,” Clark said. “This resulted in a $6 million decrease in our revenue.”

Both WellPower and the Jefferson Center are trying to avoid huge deficits this year.

In addition to cuts to Medicaid funding, health centers also lost grants and investments from local governments.

Before the cuts, WellPower’s annual budget was about $150 million, but has now dropped to $144 million.

“We expected a drop, but we didn’t expect it to be this big,” Clark said.

Both organizations argue that state, city and federal leaders need to reconsider funding mechanisms for mental health groups. They fear that without change, the industry could face major setbacks.

“This is really a crossroads in behavioral health,” Kuenzler said.

Colorado Mental Health Centers Struggling After Medicaid Rollout