Local lawmakers joined the majority of the floor to pass Senate Bill 24, which will allow an appointed state board to levy a tax on Georgia hospitals’ net patient revenue — with the money being used as state match to qualify for federal Medicaid support.
The new structure will replace an existing tax the General Assembly imposed in 2010, amid sagging revenues wrought by the Great Recession. That levy expires June 30, the end of the state’s budget year.
State Reps. Katie Dempsey, R-Rome, Eddie Lumsden, R-Rome, and Christian Coomer, R-Cartersville, all voted for the bill. Sen. Chuck Hufstetler, R-Rome, voted for it during its passage in the Senate on Jan. 17.
Coomer, a floor leader for Gov. Nathan Deal, co-sponsored the House bill that carried the same measure as SB24.
The 147-18 vote in the House on Friday is seen as a key budget victory for Deal, as it approves his plan to avoid losing more than $450 million in federal money for the Medicaid insurance program.
“Without this bill, we would certainly have an insurmountable hole in Medicaid financing across the state,” said Dempsey. “This is a continuation to provide the level of care that our citizens and the citizens of Northwest Georgia are accustomed to, which is some of the best in the state.”
The hospital industry, physicians and other health care providers wanted some kind of extension of the existing tax — which is 1.45 percent of net patient revenue — to prevent Medicaid payment cuts.
According to Lumsden, the levy raises approximately $235 million a year, which is matched by the federal government to provide an additional $450 million to provide Medicaid services.
“You have to have the match money from some source, and this is the source that is currently being used,” Lumsden said. “And, given the state of the budget, there is no other resource to get it from without taking it from another department that is already dealing with cuts.”
Dempsey, who has served as a trustee of Floyd Medical Center and as president of the Floyd Healthcare Foundation, said it was estimated that about 10 hospitals across the state would have to close if they had not extended the levy.
“The ability to deliver the care that they do, without the Medicaid reimbursement, would have been very difficult,” she said, adding that most of the ones that would have been affected were in rural areas.
Dempsey indicated that the continuation allows for job creation in the local health care industry.