Provider Tax Remains Veiled

Oregon Health Plan caseloads and an economic forecast next Friday could play havoc with the provider tax.

May 8, 2009 -- Negotiations over a provider tax that could potentially insure 180,000 Oregonians appear stalled after lawmakers cancelled a legislative hearing scheduled for Thursday morning (May 7) because an agreement had not been reached with the hospitals and health insurers. 

Senator Alan Bates (D-Ashland) had hoped negotiations could be wrapped up before the economic forecast is revealed next Friday. State economists predict a shortfall of $4.4 billion over the next biennium (2009-11).
 
Earlier, lawmakers considered a tax on union trusts and self-insured employers. However that proposal has fallen by the wayside, said Tom Burns, an aide to Rep. Mitch Greenlick (D-Portland), who drafted House Bill 2009. It was impossible to determine whether those funds would qualify for federal matching dollars, he said.
 
Meanwhile, the State Capitol buzzed with rumors about the plight of the provider tax and the impact of the revenue forecast. With fewer dollars in the state’s general fund over the next two years, the Oregon Health Plan could fall victim, with benefits slashed, which could lead to lower reimbursements to hospitals, along with physicians and other providers.
 
“Potentially everyone could lose on May 15th,” said Lynn Read, deputy assistant director of the Division of Medical Assistance Programs. “This is an incredibly unfolding scenario. There’s no firewall. Everything’s on the table.”
 
At the same time, the recession is taking its toll on state-funded services such as food stamps, temporary assistance for needy families and the Oregon Health Plan – with caseloads rising higher than anticipated when the 2009-11 budget was developed last fall.
 
The spring forecast released by the Department of Human Services predicts that 328,628 Oregonians will receive food stamps over the next two years – a 20.3 percent jump from earlier projections, while the Oregon Health Plan population will reach 486,851, representing a 6.4 percent increase. There’s also a growth of 24.9 percent in families who receive temporary assistance.
 
The dollar figures for these increased caseload projections are still being worked out. “Everything’s been driven by the recession,” Read said.
 
For related stories on the provider tax click here.

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