BRISTOL - Gov. Dannel Malloy signed a nearly 900-page two-year state budget Tuesday but line-item vetoed appropriations related to supplemental federal Medicaid reimbursements for its “language,” which raises taxes nearly $5 million a year for Bristol Hospital.
The repercussions of the increased tax could be “devastating” for Bristol Hospital, said Chris Boyle, director of public relations and marketing.
Boyle said the hospital estimates it will now pay the state around $8 million a year in taxes because of the increase in the hospital provider tax, versus the roughly $3 million it previously paid.
Hospital projects could also be more difficult to fund because of this, Boyle explained, referencing the new Downtown Ambulatory Care Center, inpatient Senior Behavioral Health Center and recruiting new health care providers to start those practices.
“It’s continues to be a tough road for us and all the hospitals in Connecticut,” Boyle said. “But we are still going to provide the safest and highest quality care to the community despite all these obstacles.”
However, Boyle is “confident” that the Connecticut Hospital Association and Malloy’s administration will come to a resolution. He said, “We have such great representation from our organization here in Bristol and all of our representatives. They all have this one thing in common, and that’s fighting on behalf of our patients and families and we’re grateful for that. They are really dedicated to the health of the Bristol community.”
The $41.3 billion budget is estimated to increase the hospital provider tax from 6 percent, to 8 percent, which, without the line-item veto, would have increased the federal Medicaid reimbursements the state receives and helped compensate for the increase in provider tax.
However, because of the line-item veto, the federal Medicaid reimbursements are not set in stone and the change to taxes still has to be approved by the U.S. Centers for Medicare and Medicaid Services, which oversees the Medicaid program.
The line-item veto was to prevent taxpayers from being exposed to “legal challenges and a potential $1 billion budget shortfall per year,” Malloy said in a press release. “I strongly urge my colleagues in the General Assembly to convene as soon as possible to pass a legal alternative to the illegal hospital tax and troublesome supplemental payment and rate language presented in the bill.”
Jennifer Jackson, president and CEO of the CHA, said in a press release: “The governor’s line-item veto of hospital supplemental payments undermines the agreement to maximize federal funds for the benefit of the state, hospitals and the patients they serve.
“In his line-item veto letter, Gov. Malloy articulated concerns with language in the state budget document related to hospitals. Hospitals have addressed his concerns. We agreed to one change the state suggested, and we pointed out that the language in the budget approved by the General Assembly is similar to language used and approved in other states. We stand ready to work with the state to address additional legitimate issues throughout the implementation of the hospital agreement contained in the budget.”
Lorenzo Burgio can be reached at email@example.com or 860-973-5088.