"It's a choice between bad and awful"; Group pushes healthcare tax reform

09/04/2018 03:58 PM

A group of hospital officials are behind a new non-profit policy group pushing for comprehensive healthcare tax reform.

The group Balanced Health Kentucky’s goal is a change in the state healthcare tax code to help fund the nearly $300 million shortfall the Medicaid system is facing—in order to save Medicaid expansion.

The group is proposing the General Assembly consider taxing all the 18 healthcare categories that makeup the healthcare economy in the state—however, they have no position on which ones—or how much they are taxed. Currently, only five categories are taxed. Which are hospitals, nursing facility services, supports for community living, ICF-MR, and licensed home health care agency services. The remaining 13 categories making up the economy are:

  • Physicians’ services
  • Outpatient prescription drugs
  • Services of managed care organizations
  • Ambulatory surgical centers services
  • Dental services
  • Podiatric services
  • Chiropractic services
  • Optometric services
  • Psychological services
  • Therapeutic/therapist services
  • Nursing services
  • Other laboratory and x-ray services
  • Emergency ambulance services

Of course, it can seem self-serving for a group of hospital officials to push lowering taxes their systems pay. Balanced Health Kentucky President Riggs Lewis says they don’t have a position on their rate or what rates the other services are charged.

“There’s 18 categories, five currently pay taxes, provider taxes, 13 categories pay nothing. And I said there are no bad actors, but if you apply a simple conservative approach. Lower the rate, broaden the base as far as the legislature wants to broaden it. You can lower the rate broaden the base, and fully fund Medicaid expansion. And in that hospitals will get a tax break, but we aren’t advocating for that. We’ve advocated for a tool and we’ve built a tool.” he said.

Balanced Health Kentucky says without a change in the tax code, the nearly 500,000 people covered through the Medicaid expansion face losing their health coverage.

“The choice isn’t whether or not you want to be involved in this tax code. Do you want to provide healthcare for 500,000 Kentuckians because if the only solution is to unplug it. You will wreck rural healthcare. You will wreck it. It will begin to shutdown and that will affect large systems in larger cities. So the choice between bad and awful. Awful is ending the program, ending healthcare immediately for 500,000 Kentuckians.”

Lewis says they are currently speaking with legislators and community members about their plan. But—they are not asking for endorsements from lawmakers, instead providing the tools to show how various tax codes would affect funding.

The Balanced Health Kentucky website provides maps with the number of people covered through Medicaid expansion by House and Senate district, Congressional District, and county. Lewis says this is to show that it is not only certain regions covered through expansion.

“You will find out there are everywhere. They are in East Kentucky, West Kentucky, Northern Kentucky. There are 75,000 in the Louisville area, 60,000 in Northern Kentucky, 750,000 in West Kentucky, and 110,000 in East Kentucky. They are everywhere but they are also called Kentuckians and they need their healthcare,” he said. “They are everywhere and this responsibility is everyone’s.”

Gov. Matt Bevin has long been an opponent of Medicaid expansion which expanded in 2014 by former Gov. Steve Beshear. The Bevin administration has said they are considering ending Medicaid expansion to fill the $300 million hole in the budget.

More information on Balanced Health Kentucky can be found at balancedhealthky.com

Watch the entire interview:

Michon Lindstrom

Michon is a producer for Pure Politics. Michon comes to Kentucky from Springfield, Illinois where she served as the statehouse reporter for the NBC affiliate. During her time in the Land of Lincoln she covered the state’s two year budget impasse and the largest school funding overall in Illinois history. Pure Politics airs weeknights at 7 and 11:30 on Spectrum News. Follow Michon on Twitter at @MichonLindstrom or reach her by email at michon.lindstrom@charter.com

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