Report on Physician Tax Shows Mixed Results

Michigan isn’t the first state to consider a tax on healthcare providers to help fund Medicaid. As HLP previously reported, Governor Granholm is pushing again this year for a 3% tax on physician revenue. The taxes can help bring matching federal support for Medicaid, so supporters of the tax argue that physicians who see a significant number of Medicaid patients stand to benefit. A recent study by the Tax Foundation, as reported in the Kaiser Health News, says that results in the 22 states who already have such a tax are showing varied results. In Kansas, for instance, a tax that raises $33 million annually brings in $77 million of federal dollars. On the other hand, in Ohio, the collective burden on hospitals exceeds the rate increases they’ll receive from Medicaid by almost $150 million.