The state’s current “bed tax” is set to expire in 2017, and many stakeholders are already gearing up for what could be a controversial vote in the state legislature next year.
Sen. Renee Unterman, R-Buford, who is chairman of the Senate’s Health and Human Services Committee, has already had at least one committee meeting on hospital issues — and the bed tax was among the topics discussed. Ethan James, Senior Vice President of Government Relations for the Georgia Hospital Association, was among those testifying.
“Right now our (GHA) position is that we are discussing it with our hospital membership,” said James, during a recent interview. “We have begun looking at the options — the pros and cons of how this will benefit all providers. We will study all options before coming to our official position.”
The Hospital Provider Payment Agreement — or what has become known as the bed tax — was created in 2010 by then Gov. Sonny Perdue and the State Legislature as a fee that Georgia hospitals pay to help boost the state’s Medicaid program. This came at a time when many state agency budgets were taking big cuts.
According to officials, hospitals pay a “provider fee” of 1.45 percent of net patient revenue to the state, who draws down federal matching funds before sending money back to the hospitals according to the level of Medicaid care they provide. Because the Medicaid program is jointly paid for by the state and the federal government, Georgia can use the money collected from the hospitals to draw down the federal matching funds.
But many stakeholders see a huge disparity among the number of hospitals receiving the funds, as well as the amount received — leaving what they call “winners and losers” across the state. For example, Grady Memorial Hospital, in downtown Atlanta, received nearly $10 million as a result of the provider fee in fiscal 2011.
Hospitals with relatively small numbers of low-income patients, however, lose money. Piedmont Hospital in Buckhead, where less than 3 percent of its patients are on Medicaid, took the biggest hit in 2011, losing approximately $6.4 million.
This initial bed tax was set to expire in 2013, but the Governor and State lawmakers renewed it for an additional four years — adding to it the Hospital Medicaid Financing Program.
Now, with the latest tax set to expire in 2017, the debates are set to begin again.
