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Florida Funding For Hospitals Could Be Affected By Proposed Property Tax Cuts

Armen Hareyan's picture

Proposed cuts to Florida property taxescould reduce funding for safety-net hospitals in fiscal year 2009,the Tampa Tribunereports. The "low-income pool" of local and state taxdollars, which receives federal matching funds to reimburse hospitalsthat provide care to low-income and uninsured residents not coveredby Medicaid, is mostly funded by ad valorem property tax revenue.Gov. Charlie Crist (R) and state lawmakers have proposed cuttingthose taxes this year.

According to the Tribune,the pool and related programs in FY 2009 will require an additional$98.1 million from local sources to cover the projected costs ofcharity care. If the taxes do not provide adequate revenue, stateofficials will have to decide whether to fill the gap with statefunding. Florida faces an estimated $2.5 billion budget shortfall inFY 2008 and FY 2009.

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State HouseHealthcare Council Chair Aaron Bean (R) said that he cannotpromise that his committee will not cut services in light of theshortfall, adding that lawmakers could trim the FY 2008 budget at thebeginning of the spring legislative session before making cuts to theFY 2009 budget. According to Gary Carnes, CEO of All Children'sHospital, lawmakers also have proposed reducing Medicaidreimbursements by up to 8%, which could increase hospitals' reliancethis year on the low-income pool and related programs.

Accordingto the Tribune, the pool relies heavily on "donorcounties," which pay more than their proportionate share intothe program. State Sen. Nan Rich (R) said, "The property taxamendment disproportionately affects our most populous communities,"adding, "When we cut back now on ad valorem taxes, we run therisk of them not being able to provide the full amount they have beencontributing. They won't have it to give, and that will affect theentire state" (Dolinski, Tampa Tribune, 1/3).

Reprinted with permission fromkaisernetwork.org.You can view the entire KaiserDaily Health Policy Report, search the archives, andsign up for email delivery at kaisernetwork.org/email. The Kaiser Daily Health Policy Report ispublished for kaisernetwork.org, a free service of The Henry J.Kaiser Family Foundation.