five reasons to let it expire 18 provider tax one pager... · $70.3 $9.0 $2.4 fy 18 hcaf...
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CCHF, 161 St. Anthony Avenue, Suite 923, St. Paul, MN 55103 P: 651?646?8935 F: 651?646?0100 www.cchfreedom.org���������������������������������������������������������������� �������������������������������������������������������
MinnesotaCareProviderTax
FiveReasonstoLetitExpireTheprovidertaxisa2%grossrevenuestaxonservicesprovidedbyphysicians,dentists,chiropractors,andotherpractitionersaswellasonhospitals,surgicalcentersandwholesaledrugdistributors.Thetaxwassignedintolawin1992forthesolepurposeoffundingtheMinnesotaCareprogram.
1. The2019sunsetoftheprovidertaxwasagreedtoin2011aspartofnegotiations.ItsexpirationwillsignificantlyreduceHealthCareAccessFund(HCAF)revenue,whichhasbecomeaslushfundsustainedbytaxesonthesickandinjured.
2. InFY2018,theMNcareprogramwasfundedbytheFederalBasicHealthProgramFunding(89%),EnrolleePremiumsandCostSharing(8.8%)andtheStateofMinnesota(2.1%).Ofthe$414millionspentonMinnesotaCareinFY2018,aminoramount—roughly$9million—camefromtheHCAF.
3. FY2016HCAFrevenueswere$717.7millionincluding$598.5millionfromthe2%providertax.GeneralFundandSpecialRevenueFundprogramsreceivedroughly$682millionandStateAgenciesreceivednearly$66millionfromtheHCAF.
4. Accordingtothe1992MinnesotaCareandProviderTaxlaw: Sec.21.[FEDERALWAIVER;HEALTHCARERELATEDTAX.]
ThelegislaturefindsthattaxesimposedbythisarticlearenotsubjecttoorinviolationoftherestrictionscontainedintheSocialSecurityActorotherfederallaw.Thetaxisimposedsolelytofundastateprogramandisnotusedtopaythestateshareofmedicalassistance.
5. WiththemajorityofMinnesotaCarefundingcomingfromothersources,thesunsetoftheprovidertaxshouldberetained,notrepealed.Thesunsetofthistaxwillleadtoa2%reductionincosts,reducedadministrativeburdenforpractitionersandfacilities—andanendtotheunfairtaxationofpatients.
Diagrams:(seeotherside)
Graph1–FY2018HCAFRevenue
Graph2–FY2018HCAFExpenditures
Graph3–FY2018MinnesotaCareCosts
Provider Tax Used for Slush Fund, Not MNCare
(Revenues and Expenditures shown in millions)
*Graphs do not include tax refunds or pass-through funds (BHP + Enrollee Premiums)Source: Health Care Access Fund, February 2018 Update, MMBGraphic Created by Citizens’ Council for Health Freedom
$658.4
$101.2
$33.8
FY 18 HCAF Revenues
2% Provider Tax
1% Gross Premium Tax
Misc
$507.2
$214.0
$70.3
$9.0
$2.4
FY 18 HCAF Expenditures
General FundSpecial Revenue FundState AgenciesMNCareMisc
89%
8.8%
2.1%
FY 18 MNCare Costs
Federal
Enrollee Premiums
State
FY 2018