Taxing hospitals to pay hospitals

Rocket science in government!

Arizona governor plans to tax hospitals to expand Medicaid

PHOENIX — Arizona Gov. Jan Brewer has built a political career in standing up to the federal government over everything from immigration to health care. So she surprised almost everyone when she announced last week that she not only plans to push for an expansion of the state’s Medicaid program under the federal health care law — she plans to fund it by raising taxes.

A conservative Republican, Brewer is believed to be the first governor to publicly come up with a way to fund the controversial Medicaid expansion. Not even California Gov. Jerry Brown, a Democrat in a state that largely supports the new federal health plan, has figured out how to pay for a boosted Medicaid plan.

Her proposal to add about 300,000 low-income Arizonans to her state’s Medicaid plan relies on funding from hospitals through a so-called provider tax. The idea is already used to fund some Medicaid plans in 39 states, but none has tapped it to pay for the federal expansion and many have at least some room to expand their hospital taxes.

So, Governor Brewer proposes increasing taxes on hospitals to pay for the program by which the state pays for poor people to receive hospital care. If that, in itself, isn’t amusing enough, consider all that it means:

  • Hospitals will have to charge all patients more, because the providers’ tax is hospital wide.
  • Because all patients will have to pay more, patients who have private health insurance will see their rates rise, because their insurance companies will have to pay more.
  • Because hospitals will have to charge all patients more, Medicaid will have to pay more to treat Medicaid patients, due to the tax imposed to support Medicaid.
  • Because private insurance companies will have to pay more, and will therefore have to charge their customers higher insurance premiums, fewer companies and individuals will be able to afford health insurance, meaning that the number of uninsured persons will increase, which will dump more people onto Medicaid.

All of this is because our politicians are simply not honest enough about taxes and the costs of government. In the end, all of the costs will be borne by individuals. Everything has to be paid for, somehow, but rather than Governess Brewer stating, openly, that Arizona will have to increase taxes on individuals to pay for the expansion of Medicaid, she’s come up with a scheme to (supposedly) tax hospitals, which will lead to increases in insurance premiums, which won’t be actual taxes, mind you, but they will still be taking money out of the pockets of Arizonans. Your Editor is apparently not sophisticated enough to see how an individual having to pay, say, $100 more per month in insurance premiums (when health insurance has now become a mandatory purchase) is somehow better off than an individual having to pay $100 more a month in taxes.

There will, your Editor expects, be more stories along these lines coming in the future. Governess Brewer went first, because, according to the original news story, Arizona was going to be the first state to see a large increase in costs due to how its Medicaid program is structured.

But conservatives had been saying all along, both before the ObaminableCare law was passed and after, that the President’s promises on it were pure bovine feces: you cannot add thirty or forty million people who could not pay for health insurance before to the insurance rolls and not have costs go up for everybody else, and you cannot create a federal guarantee that, in the end, the government will see to it that you get health care, without everybody having to pay more for health care. Of course, the Democrats trying to sell nationalized health care coverage were never going to be honest about that, because, had they been honest, it would never have passed.

So, they resorted to gimmicks and lies, and claimed that if you liked your current health insurance, you could keep it, that it would lower costs and thus be better for everybody, yada, yada, yada. They got it passed, and now people are starting to see that yes, creating yet another federal entitlement — regardless of whether it was structured like a traditional entitlement — costs more money, and will cost every American who actually works for a living more money.

We told you so!

Of course, it’s too late now to change it. Our last chance to undo the disaster that is the laughably named Patient Protection and Affordable Care Act was lost on November 6, 2012. Now, that abysmal law will have come into full force before President Obama’s term in office is over, and it would be tremendously difficult to repeal after he leaves office without replacing it with some other form of universal health care coverage. It will be possible to change the way universal health care coverage is provided — something which might or might not somewhat reduce the tremendous costs — but repealing the universal coverage guarantee itself simply will not happen.

And we will all be poorer for it.
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Update:

Phineas noted how Stark State College is limiting the courses and hours taught by one Robert Balla, specifically to avoid having him cross the threshold beyond which they would have to allow him to enroll in the colleges health insurance plan.

The Affordable Care Act requires large employers to offer a minimum level of health insurance to employees who work 30 hours a week or more starting in 2014, or face a penalty. The mandate is a particular challenge for colleges and universities, which increasingly rely on adjuncts to help keep costs down as states have scaled back funding for higher education.

A handful of schools, including Community College of Allegheny County in Pennsylvania and Youngstown State University in Ohio, have curbed the number of classes that adjuncts can teach in the current spring semester to limit the schools’ exposure to the health-insurance requirement. Others are assessing whether to do so, or to begin offering health care to some adjuncts.

In Ohio, instructor Robert Balla faces a new cap on the number of hours he can teach at Stark State College. In a Dec. 6 letter, the North Canton school told him that “in order to avoid penalties under the Affordable Care Act…employees with part-time or adjunct status will not be assigned more than an average of 29 hours per week.”

Mr. Balla, a 41-year-old father of two, had taught seven English composition classes last semester, split between Stark State and two other area schools. This semester, his course load at Stark State is down to one instead of two as a result of the school’s new limit on hours, cutting his salary by about a total of $2,000.

The JOURNAL article notes that Mr Stark earns about $40,000 a year, and claims that he cannot afford health insurance on his income.

So, what does the PP&ACA do in the case of Mr Balla and those similarly situated? States are reducing funding to public education, because state budgets are tight, and things have to be cut. This means that people like Mr Balla are going to have to go through the government to get assistance to pay their now-required health insurance premiums. Without the law, Mr Balla would be earning more, and might, might, be able to afford health insurance, but even if he couldn’t, the government would not be under any obligation to buy it for him. Because the government is now required to help people like Mr Balla obtain health insurance, the government will have to spend more money to do so. Since the government will have to spend more money to help Mr Balla get health insurance, it will have less money available for Stark State College, and Stark State College will have to cut more spending, possibly by cutting Mr Balla’s hours further.

Then-Speakess of the House Nancy Pelosi famously said that we’d have to pass ObaminableCare to see what was in it. Well, we did, and now we are finding out what was in it. A law, written by bureaucrats and lawyers and lobbyists, by people with little knowledge about health care and even less about business and economics, to assert control over one-seventh of our economy, all because they thought it was a great idea; what could possibly go wrong?

One Comment

  1. I can’t say as I blame Gov Brewer for her actions. Obama is forcing her state to pay for all these health care mandates, and that money has to come from somewhere.

    Of course, it pretty much puts the nail in the coffin of the notion that the “Affordable” Care act will make health care in any way more affordable.

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