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Lamont Offers No Tax Relief To Hospitals

by | Feb 21, 2019 12:49pm () Comments | Log in to Facebook to Post a Comment | Share
Posted to: Health Care, State Budget

Christine Stuart / ctnewsjunkie file photo

HARTFORD, CT — Gov. Ned Lamont may not use the same rhetoric as his predecessor, but his budget is just as harsh on Connecticut’s hospitals when it comes to taxing them.

Lamont’s two-year $43 billion budget canceled a previously approved tax cut for hospitals and it maintained a much lower rate for inpatient hospital rates that was not expected.

“Look folks there are no easy choices,” Office of Policy and Management Secretary Melissa McCaw said Wednesday. “There’s pain throughout and we’re looking for all stakeholders to be a part of the solution.”

Asked why they tax hospitals McCaw’s predecessor, Ben Barnes, said because, “It’s like why do you rob banks? … It’s where the money is.”

The rhetoric might be different, but the end result is the same.

After two years of paying $900 million annually in provider taxes, hospitals were supposed to see the tax drop to $384 million. Lamont’s budget maintains the tax at $900 million and gives them back $453 million as part of a calculation to get more federal Medicaid reimbursement. That ends up being a $43 million loss per year for the hospitals.

In addition the administration doesn’t change the calculation for the inpatient hospital rates.

“We are not making any adjustments to the rates in the biennium,” McCaw said Wednesday.

That means hospitals will lose about 16.8 percent or about $170 million annually. The decision will save the state about $59.1 million in 2020 and $61.8 million in 2021.

Christine Stuart / ctnewsjunkie file photo The Connecticut Hospital Association is not happy with the proposal.

“We are strongly opposed to the proposed budget,” Jennifer Jackson, CEO of the Connecticut Hospital Association, said. “The current administration is not honoring the bipartisan agreement for this year or next year, and the budget makes additional cuts to hospitals.”

Senate Republican Leader Len Fasano, R-North Haven, said Lamont’s budget undoes a lot of the progress made by the bipartisan budget agreement.

“I don’t understand when he says we’ve got to get together and we’re not Washington—we did two years ago,” Fasano said. “Why are you messing with that?”

Lamont has pledged to work in a bipartisan way, but Democrats won big last November and no longer need Republican votes to get things passed.

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