A four-year extension of the hospital assessment tax, which is used to fund the bulk of the state Medicaid program, appears headed for swift passage this session, without any of the partisan theatrics that have dogged previous extensions of the tax.
Senate President Peter Courtney, D-Salem, told reporters Wednesday morning that he expected it to move ahead quickly, and House Bill 2395 easily passed its first hurdle in the afternoon, clearing the House Health Committee unanimously.
“We have agreement from everybody on this bill,” said Rep. Mitch Greenlick, the Health Care chairman.
The bill now heads to the Committee on Ways & Means, where it will first have a public hearing before the Human Services subcommittee, headed by Sen. Alan Bates, D-Medford and Rep. Nancy Nathanson, D-Eugene. From there, it is expected to quickly move through the full budget committee before a full House vote next month.
The proposed $1.4 billion assessment on the revenues of the Oregon’s 28 major hospitals over the next four years will be used to leverage $7.3 billion from the federal government between July 2015 and 2019. The assessment is popular among Oregon hospitals because it not only ensures funding for the Oregon Health Plan, but the hospitals themselves are often able to take in more money than they pay in.
“The assessment is on the revenue of the hospital,” Greenlick explained. “The money is returned to the hospitals as a whole.”
Greg Van Pelt, the former chief executive of Providence Health & Services in Oregon and the current director of the Oregon Health Leadership Council, laid out the major provisions of the revenue package to The Lund Report before the session, highlighting the transformation fund, which in its new conception will benefit coordinated care organizations as well as hospitals, which was conceived in the 2013 tax package.
Bureaucratic delays from the federal government have kept any of that transformation money from actually compensating hospitals which have shifted away from emergency care toward providing more coordinated care. In January, hospital association spokesman Philip Schmidt informed The Lund Report that the first allotment of dollars from the 2013 transformation pool will be disbursed in March.
Gov. Kate Brown’s healthcare advisor, Sean Kolmer, explained that 1 percent of the revenue generated from the hospital assessment tax will go into the new transformation pool, and half of that will be distributed to the CCOs. Since several of the CCOs are controlled by the hospitals, much of that money would still likely benefit the hospital systems.
Before the session, the Oregon Health Leadership Council promoted the new assessment tax as another two-year deal, but Courtney and Greenlick worked out a longer deal, which would make the new hospital assessment last four years so that the Legislature will not have to go through the motions of passing an assessment next session, as it has done in past years.
“We’ve been doing it every two years, and it’s a mess,” Courtney told reporters. Not only does Courtney believe he’ll get a bye from pushing it through in 2017, he believes that the Republicans are on board with the assessment renewal vote for 2015.
In 2013, the passage of the hospital and nursing home assessment tax (which runs through 2020) was tied up for months by Senate Republicans hoping to extract political concessions from Democrats before finally voting to renew the tax. All taxes must receive the backing of 60 percent of legislators, even politically popular ones such as the hospital assessment tax.
“I haven’t been told there’s any leveraging going on with this provider tax,” Courtney said.
Speaking with The Lund Report, freshman Republican and orthopedic surgeon Rep. Knute Buehler of Bend concurred: “I think that will have little or no opposition from my colleagues.”
The bill was presented to the House Health Committee by Dave Underriner, the chief executive of Providence Health & Services -- Oregon; Martin Taylor, the director of CareOregon, which contracts with four CCOs to manage care for the Oregon Health Plan; and Kolmer.
Kolmer has remained in state government as Brown’s healthcare advisor, despite both his role in the development of Cover Oregon and his close relationship to former Gov. John Kitzhaber, who was railroaded out of office earlier this month amid ethics allegations involving his fiancee, Cylvia Hayes.
“In light of where we are in the legislative session, there is benefit to restoring stability, and she values the institutional knowledge of senior staff in specific policy areas,” Brown’s spokeswoman, Kristen Grainger, told The Lund Report in response to a question about Kolmer’s continued role.
