Provider groups slam tax cuts in Medicaid bill

Porter: the tax cut is a "poison pill"
Porter: the tax cut is a "poison pill"

Legislation that aims to reduce the federal deficit by cutting Medicaid provider taxes has the nation's largest provider groups crying foul.

The Common Sense Savings Act of 2016 was marked up and slated for a vote by the House Energy and Commerce Committee on Monday evening. It, would reduce provider assessments to 5.5% from the current 6% cap. A similar cut was passed as part of the Spending Reduction Act of 2012.

That reduction could cut billions from state Medicaid dollars that are typically used to fund long-term care, according to AHCA Senior Vice President of Government Relations Clifton Porter II.

"This bill contains a poison pill that the association and its more than 13,000 provider communities nationwide cannot support,” Porter said in a news release. “Provider assessments are a critically important part of our care delivery system — a system that is continually asked to do more, yet facing ever-dwindling resources to meet these growing needs.”

Cheryl Phillips, M.D., senior vice president of LeadingAge, echoed AHCA's concerns about the potential negative impact of the bill.

"This would be significantly harmful for many states,” Phillips told McKnight's. “Reducing the provider tax would impact Medicaid rates and the ability of many providers to serve vulnerable individuals.”

Porter said AHCA will “actively fight to defeat” the section of the bill that includes the provider assessment cuts, as “no healthcare profession can improve — much less survive — under that payment structure.” The groups' frustration with the tax cut is a sign that long-term care financing as a whole needs “fundamental restructuring,” Porter noted.

The Common Sense Savings Act also includes provisions that would bar “multimillion dollar” lottery winners from receiving Medicaid, and reduce the share of Medicaid expenses the federal government covers for prisoners.