Thursday, November 27, 2014
My Account  | Login
Nashua;33.0;http://forecast.weather.gov/images/wtf/small/nsn.png;2014-11-27 04:31:17
Thursday, June 5, 2014

Medicaid tax deal sails through NH Legislature to governor’s desk

CONCORD – With surprising ease, a settlement to resolve legal action brought against a controversial tax on hospitals cleared the New Hampshire Legislature on Wednesday.

While last week only one Republican legislator offered support for the deal that Gov. Maggie Hassan brokered with 25 of the state’s 26 acute-care hospitals, the plan sailed through the House and Senate with little debate or opposition. ...

Sign up to continue

Print subscriber?    Sign up for Full Access!

Please sign up for as low as 36 cents per day to continue viewing our website.

Digital subscribers receive

  • Unlimited access to all stories from nashuatelegraph.com on your computer, tablet or smart phone.
  • Access nashuatelegraph.com, view our digital edition or use our Full Access apps.
  • Get more information at nashuatelegraph.com/fullaccess
Sign up or Login

CONCORD – With surprising ease, a settlement to resolve legal action brought against a controversial tax on hospitals cleared the New Hampshire Legislature on Wednesday.

While last week only one Republican legislator offered support for the deal that Gov. Maggie Hassan brokered with 25 of the state’s 26 acute-care hospitals, the plan sailed through the House and Senate with little debate or opposition.

The House passed the plan 278-72, and the Senate by a voice vote.

“In New Hampshire, unlike in Washington, D.C., we continue to work across party lines to solve problems in order to keep our economy moving forward and to protect priorities that are critical to our people,” Hassan said.

“I thank legislators from both parties, hospitals and other stakeholders for working together to find a solution to this issue, and I look forward to signing this bipartisan legislation in order to protect our budget and help ensure the health and well-being of Granite Staters.”

The agreement is meant to commit the state to supporting payments to hospitals for four years starting July 1, 2015.

But even supporters acknowledged that it has to be ratified every year by lawmakers.

“We can always, as a Legislature, change our mind and cannot, by definition, bind our successors,” said state Rep. David Hess, R-Hooksett.

Sen. Robert Odell, R-Lempster, said the agreement challenges the newly elected governor and Legislature to find the state money to pay for it early next year.

“It is a significant amount of money that is going to cost the state of New Hampshire in the next two years, but it is the right thing to do,” Odell said.

State officials believe the proposal will cost the state at least $43 million in state dollars for the first two years.

Depending on changes to the health care system, the exposure to the state from this agreement could be as much as $93 million for that two-year period, officials said.

St. Joseph Hospital, of Nashua, is the only hospital whose executives declined to sign this agreement. St. Joseph and three other hospitals convinced a Hillsborough County Superior Court judge that the Medicaid Enhancement Tax was unconstitutional because it made hospitals pay the levy while other health care providers giving the same outpatient services did not.

The final deal lowers the tax slightly to 5.4 percent by mid-2017 from its current 5.5 percent rate.

If hospital spending targets are reached by mid-2018, then the tax would drop further, to 5.25 percent.

Under the agreement, all hospitals are guaranteed to receive at least 50 percent of services they provide to inpatients for free or at reduced cost. St. Joseph Hospital offers little free or reduced care.

Smaller, rural hospitals would continue to get at least 75 percent back for what they paid out for uncompensated care.

In turn, the agreement caps the financial exposure facing the state over a four-year period.

The deal exempts rehabilitation hospitals from the tax.

Under the agreement, hospital executives agree to drop lawsuits in state courts over the tax and in federal court over the rate the state pays hospitals for patients on Medicaid.

“This is an important agreement that will allow New Hampshire to move forward, building a strong and sustainable health care system for our people,” the New Hampshire Hospital Association said in a statement.

“It’s also a good example of how the state and the hospital community can, working together, make progress on a major and complex public policy issue that has challenged our state for many years.”

Kevin Landrigan can reached at 321-7040 or klandrigan@nashuatelegraph.com. Also, follow Landrigan on Twitter (@Klandrigan).