New York proposes 3% tax on hospitals building new facilities

Under New York Gov. Andrew Coumo's $178 billion budget plan, hospitals hoping to build new facilities in the state would pay a 3 percent fee tied to the estimated project cost, according to The New York Post.

The state requires hospitals to file certificate of need applications for construction projects. These applications must be approved by the department of health before construction can begin. 

Hospitals filing certificate of need applications currently pay an administrative fee of up to $2,000 and a 0.55 percent fee that is determined based on the expected project costs.

The proposal would boost the 0.55 percent fee to 3 percent. The tax is an effort to generate $70 million in revenue to address a budget shortfall in the state's Medicaid program.

Some healthcare advocates argue the surcharge should be rejected because it may increase the hardship of some facilities.

"There are some wealthy hospitals that could afford to pay an extra $3 million for approval of a $100 million project. But there are many for which this fee would be a serious burden and hardship, especially facilities heavily dependent on Medicaid," Assembly Health Committee Chairman Richard Gottfried, D-Manhattan, told The Post. 

More articles on facilities management:
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6 hospital, health system construction projects costing $300M or more

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