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Non-Profit Led by Hospital Executives Hoping for Changes to Kentucky's Health Care Tax Code

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A new non-profit group in Kentucky is advocating state health care tax reform as a way to fund the state’s Medicaid expansion.

Balanced Health Kentucky is asking state lawmakers to review all of the health care industries in the commonwealth, and consider how much they are—or aren’t—being taxed.

Kentucky expanded the number of people eligible for Medicaid in 2014 under then-Governor Steve Beshear, a Democrat.

Republican Governor Matt Bevin has been a vocal critic of the move, citing the expansion’s costs and the state’s budget woes

Balanced Health Kentucky President Riggs Lewis, who is also Vice President of Norton Healthcare, says state lawmakers have the ability to reconfigure Kentucky’s health care tax to address the problems.

“The federal government recognizes 18 distinct health care categories that can pay the tax in order to draw down that two-and-a-half times federal match. For every dollar you raise at the state level, you can pull down two-and-a-half times. That money goes to pay for what will be 500,000 people on Medicaid expansion.”

Kentucky Hospitals currently pay the largest share of a “provider tax” that generates about $300 million a year for physicians, mental health counselors, and others who don’t pay the tax.  

Balanced Health Kentucky is hoping lawmakers look at expanding the number of groups who pay the provider tax, which would help fund the state’s Medicaid expansion.

Lewis said his group supports the Medicaid expansion, but wants lawmakers to find a sustainable way to fund it.

Jason Bailey, executive director of the progressive Kentucky Center for Economic Policy, told the Courier-Journal that while the provider tax hasn’t increased in 12 years, hospital revenue has increased over that time period, thanks in no small part to 2014 state Medicaid expansion.

Kevin is the News Director at WKU Public Radio. He has been with the station since 1999, and was previously the Assistant News Director, and also served as local host of Morning Edition.
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