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Monday, April 22, 2024

Colorado Closures

Nick Coltrain, The Denver Post:
Since 2021, at least 13 companies—operating about 35 clinics of different sizes—have closed or left the state over reimbursement rates that haven't kept up with rising costs, according to research by the Colorado Association for Behavior Analysis. Those closures have affected treatment for some 1,380 patients, and an estimated 1,000 Coloradans lost their jobs, according to the group.

"Colorado is relatively unique in the Medicaid landscape right now because of the number of programs that have closed and/or exited the state," said Mariel Cremonie-Fernandez, the vice president of government affairs for the national Council of Autism Service Providers.


Rebecca Urbano Powell, executive director of Seven Dimensions Behavioral Health, said she watched her waitlist balloon from two months to six months as the industry contracted in recent years. And with low reimbursement rates, she's lost entry-level staff to Starbucks and Walmart, she said, effectively cutting off entry into the behavioral health workforce before workers can get their feet under them.

"They could choose to work with kids with very severe, dangerous behaviors, or go work at Starbucks as a barista, and make the same—if not more—as a barista," said Urbano Powell, who also is board president of the Colorado Association for Behavior Analysis.


The growing role of private equity investment firms also complicates matters, HCPF warned, as firms buy up providers and close down autism services when they don't hit profit goals.

HCPF cited a national report from the Center for Economic Policy and Research that found private equity firms "move in and skim funds to pay high salaries to executives and outsized returns to private equity partners." The study did not cite any Colorado-specific impacts but noted that many of the firms it looked at operate in dozens of states.

While some budget committee members were "agnostic" to ownership structures of autism providers, as one put it, Sen. Jeff Bridges was more skeptical. While the Arapahoe County Democrat ultimately voted to increase funding, he worried it would set a precedent that investment firms could demand money to pad profits to their liking—and hold autism services hostage to do so.

"To me, it feels like a monopoly," Bridges said. "There's a real problem here if private equity is coming in here and doing what they did to other markets to autism providers. If those folks are getting in the way, then we absolutely have to take the fight to them."