Ohio Hospitals Cannot Afford New Taxes

With Ohio’s unemployment nearing 10 percent, and Lucas County specifically nearing 12 percent, state legislators cannot afford to worsen the financial burden of Ohio’s citizens and businesses. As elected representative of the 46th Ohio House District, I will represent your views earnestly and support policies that will incite Ohio’s economic recovery.

In the past 12 months alone more than 200,000 hardworking Ohioans have lost their jobs, according to the Ohio Department of Job and Family Services (ODJFS). Toledo-area hospitals are being hit especially hard by the economy and have initiated extensive layoffs. The University of Toledo Medical Center has closed its geriatric psychiatric unit and consequently left 37 employees jobless. Additionally, Mercy Health Partners has laid off 70 employees, and ProMedica has eliminated 30 jobs at Sylvania’s Flower Hospital and Toledo Hospital.

The increased layoffs are a direct result of the laboring economy and the high unemployment rates in Ohio. As unemployment rises, more hospital patients require charity services due to higher deductibles or a lack of insurance altogether. According to the Ohio Hospital Association, charity work by hospitals has increased by 41 percent since last June. As a result, hospitals are reimbursed even less for their services, forcing budget cuts and layoffs in the health care sector.

The governor’s proposed state operating budget included more than 150 new fees on everything from health screenings to motor vehicle registration. These fees act as taxes to raise more than $1 billion for the state. One specific fee proposed by the governor was a hospital franchise fee, which was implemented to fund Medicaid and projected to charge hospitals nearly $600 million during the next biennium.

House Democrats have recently made changes to the governor’s original budget proposal, increasing the hospital fees in order to raise the federal stimulus match and to increase Medicaid reimbursement to the hospitals. The new budget plan would only cost hospitals a net $127 million after reimbursement, compared to the governor’s proposed $411 million.

Nevertheless, increasing the hospital fee fails to address skyrocketing Medicaid costs and wasteful spending still present in the budget. The plan still puts the Medicaid budget on the shoulders of struggling hospitals, despite the higher reimbursement rates. In this difficult economy, the addition of any new taxes on hospitals will ultimately have adverse consequences, as more jobs and medical services are cut. A smarter solution would be to eliminate the hospital tax entirely and instead focus on reducing wasteful spending within the Medicaid system.

As both a state legislator and concerned citizen, I hope to see a solution arise that doesn’t require further government expansion and overspending. As the budget continues through the Legislature I will continue to advocate for policies that promote job growth, and I will faithfully represent your views in all legislative proceedings.

If you have any questions or concerns regarding legislation or state government, please feel free to contact my office at (614) 466-1731 or write to me at Representative Barbara Sears, 77 S. High Street, 10th Floor, Columbus, Ohio 43215. You may also email me at District46 at ohr.state.oh.us