Congress unlikely to block use of hospital taxes to help pay for Haslam health plan

Jan. 24--NASHVILLE -- As Gov. Bill Haslam continues trying to build support for his Medicaid-alternative health insurance plan, he likely can take one major threat cited by its opponents off the table -- potential federal action blocking the use of hospital provider taxes to pay the state's share of the health plan.
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Tennessee has been using "hospital assessment fees" since 2007 to offset some of the state tax revenue needed to pay the state's share of Medicaid/TennCare, which is about 65 percent federally funded and 35 percent state funded. The Tennessee Hospital Association came up with the idea, voluntarily, to offset more cuts to Medicaid under former governor Phil Bredesen, because many hospitals get back more in Medicaid payments than they pay in fees due to the federal-state Medicaid funding structure. The fee is now about 4.52 percent of hospital gross patient revenue. Now, Tennessee hospitals have agreed to foot the bill, through the fee, for any additional costs the state faces in paying for Insure Tennessee. (link)

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