A hospital provider fee, or provider tax, collects money from hospitals and pays them back through reimbursements. The amount hospitals get back hinges on their amount of Medicaid business, so some providers lose money while others gain funds.
Most hospitals favor provider fees because it allows the state to gain additional Medicaid revenue from the federal government. However, in Connecticut, the formula changed in 2012, and hospitals are reimbursed for less than what they pay, according to the report.
A recent report from the Connecticut Hospital Association indicates that starting this July, the tax on hospitals will more than double to $235 million, and the reimbursement back will not cover all the fees. The CHA expects this year’s tax will raise the average cost of a patient by $49.
A proposed bill would phase out the provider fee by 2019.
More Articles on Hospitals and Provider Fees:
Moody’s: Medicaid Provider Fee Extension Benefits California Hospitals
New Hampshire May Alter Medicaid Provider Tax
Helping Turn Around an Essential Safety Net: Q&A With Grady Health System CFO Mark Meyer
