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  • on 14.03.2011
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Health tax plan faulted [The Telegraph, Nashua, N.H.]


March 15CONCORD A proposal for the state to carve out more profit from a tax on hospitals has some House Democrats crying foul and a think tank warning it could lead to higher health insurance costs.
A working group on the House Finance Committee is considering the change to raise the so-called bed tax that hospitals pay.
Currently, hospitals pay the 5.5 percent tax on revenue but then share in a federal reimbursement bonus that returns most of the money to them and the state.
Under this latest proposal, the tax would go up to 6 percent and the hospitals would pay in $165 million.
In return, those critical care access hospitals that treat the largest number of indigent patients would get $50 million, about one third of the reimbursement of the current arrangement .
Rep. David Campbell, D-Nashua, claimed that if adopted, this runs counter to the claims of GOP legislative leaders that they would oppose all tax and fee increases while writing this next, two-year state budget.
"This would be one of the largest tax increases in state history," Campbell said. "This not only would decimate some hospitals, it could convince some employers to leave the state or cancel plans to expand here."
Health and Human Services Commissioner Nick Toumpas proposed this change as a way for the House to balance its budget spending $500 million less than Gov. John Lynch.
But Toumpas did not endorse the plan.
Meanwhile, a report from the New Hampshire Center for Public Policy Studies concluded that the hospital cuts could trigger the same "down shifting" that would occur with Lynch’s plans to reduce state aid to cities and towns.
The hardest-hit hospitals could be those that are losing money in contrast to the larger, profitable ones, many of which are in the southern tier, according to Steve Norton, executive director of the center and author of the report.
"As a system, the health care industry still has positive profit margins but there are number of hospitals in the red," Norton said. "Those are the ones most affected by the budget reductions."
Rep. Neal Kurk, R-Weare, chairs the House Finance working group that has discussed the cut in aid to hospitals.
He stressed Monday that all proposals are subject to change and the full committee sometime next week could decide to reject any of the proposals.
The working group has backed off or lessened the impact of some cuts.
Originally, they talked about doing away with state spending on grants for family planning, domestic violence, victims with sexually transmitted diseases and family supports for those on Medicaid.
The working group is now discussing 50 percent cuts for those programs.
A separate working group has proposed a 45 percent cut in state aid to the four-year public college system. Lynch last month proposed a 5 percent cut.
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