GWEN IFILL: Next: tough choices for states facing record budget shortfalls.
"NewsHour" correspondent Tom Bearden reports from Colorado.
TOM BEARDEN: A truck rolls up to a Denver soup kitchen, not to deliver food, but medical care for the homeless.
WOMAN: And, so, are you here about your throat?
WOMAN: Nice and fast and loud.
WOMAN: We have got look behind your ears, OK? It's real important that we do that.
TOM BEARDEN: Inside, people are treated for diabetes, high blood pressure, mental health problems, about 2,200 patients a year.
WOMAN: Hey, Roger. How you doing?
The Colorado Coalition for the Homeless has been operating the mobile clinic for eight years. And they believe it has saved countless lives.
WOMAN: All right. Well, I will look in your ears and I will listen to you again and see what else I have got to offer.
TOM BEARDEN: Sheri is homeless. The truck is her primary health care resource. She is scared, because this is the mobile clinic's last run.
SHERI, homeless: Freaking me out kind of, because, like now, when you are homeless, that's a whole day. And that's a lot. You are trying to find a safe place and warm place to sleep, and trying to make some money, so you can do what you have to do. And it's -- it's hard. And, sometimes, it's impossible. So, people will go -- will end up going without health care.
MAN: Now, the other day I was in the clinic.
TOM BEARDEN: The clinic is one of the victims of a $2 billion shortfall in the Colorado state budget. Forty-three states have cut services to their residents due to budget deficits.
Tax revenues have plunged during the recession. And the state has been forced to reduce funding for groups like the Coalition, as well as many other government services.
GOV. BILL RITTER, D-Colo.: Well, it's the worst recession since the Great Depression. Anybody who finds themselves in a position where they are trying to reconcile the shortfalls, I think, are dealing with really the worst budget decision we have seen since the 1930s.
TOM BEARDEN: Governor Bill Ritter says he went through the $18 billion state budget literally line by line, looking for cuts that would have the least impact on people.
GOV. BILL RITTER: This is a very difficult time, because there's a lot of different places where you can look at this budget and know that there's an impact on human beings and on real people. Because cuts have a different impact than growing the budget does, because they have a negative impact that could really hurt the quality of life in some respects, it's important to do them line by line.
JOHN PARVENSKY, president, Colorado Coalition For the Homeless: We have been meeting with the neighborhood now for a little bit over a year.
TOM BEARDEN: But John Parvensky, who runs the Coalition for the Homeless, says the $3.4 million hit his organization took is going to cost lives.
JOHN PARVENSKY: If we see more and more people on -- in the shelters and on the streets, more people who are denied access to the health and the mental health services that they need, there's no escaping the fact that there will be more people dying on the streets of our country.
TOM BEARDEN: The governor is sympathetic, but says something had to give.
GOV. BILL RITTER: We have done everything we can, everything we can, in the circumstance we find ourselves in to protect the safety net. And we have done that with input from John Parvensky and other people like him.
WOMAN: Follow the light with just your eyes.
TOM BEARDEN: Parvensky says the state funds totaled about 25 percent of his entire health care budget, that deciding how to allocate the remaining money was a challenge.
JOHN PARVENSKY: When they come in our door, they're very needy. So, we structured our programs very efficiently to be able to respond to the need. We have always done it on a shoestring, as much as we can, very light in the administrative side. So, there's not much to cut when you face a budget cut of that magnitude.
WOMAN: Hi, Alexander. How are you today?
TOM BEARDEN: Parvensky froze all salaries and then closed this women's mental health facility. He says the hardest decision was to close the mobile clinic, which cost about $250,000 a year to operate.
DR. AMY ALPER-PANEYA, Colorado Coalition For the Homeless: OK. With your mouth open, big breath.
TOM BEARDEN: Dr. Amy Alper-Paneya on the van for more than three years.
DR. AMY ALPER-PANEYA: Sometimes, we will get that person who just wants some ibuprofen. And so they will come on board. And then, as we sit and we talk to them and we hear their story, we find that there's a whole bunch of other things going on, whether it is socially or mentally or medically.
And, so, I feel like we are a first front-of-the-line kind of van or organization that can help connect people to further services that they may need.
TOM BEARDEN: Ritter says he understands the problem, but has no choice.
Three-point-four million dollars is pocket change in the state budget. Are you down to making decisions about amounts of money like that, that are so small?
GOV. BILL RITTER: Well, yes. And then that's -- this has been a surgical exercise. And the reason is because those small amounts ultimately can build to a big amount.
TOM BEARDEN: The cuts come just as the need for these services is increasing. More people are showing up at soup kitchens, because the Department of Housing and Urban Development estimates the number of homeless families has gone up almost 10 percent in just the last two years.
MELINDA PATTERSON, director, Father Woody's Soup Kitchen: Any emergency for anything of that nature, you just go to the emergency room, and you can't rely on the van any longer.
TOM BEARDEN: Melinda Patterson is the director of Father Woody's Soup Kitchen.
MELINDA PATTERSON: So, this time a couple years ago, even last year, we probably had 100 people, and now we are seeing about 400 a day.
TOM BEARDEN: Parvensky says the dilemma facing groups like his is how to help more people with less money.
JOHN PARVENSKY: I have been doing this work now for almost 25 years. And this is the first time that we have been faced with an increase in the need of the population at a time when the funding is -- is decreasing so rapidly.
It's very discouraging, and it's very heart-wrenching. Every day, I walk through the lobby and see more and more people, families with kids, adults, who are waiting for help.
TOM BEARDEN: Its last run complete, the Homeless Coalition's mobile clinic was put into storage. Parvensky is trying to find private grant money to put it back on the street.
In the meantime, Governor Ritter and the state legislature face another $1.5 billion budget shortfall in the next fiscal year, meaning they will have to go back through the state budget once again, looking for more ways to save money.