Conn. hospital association contests state provider tax
The Connecticut Hospital Association is contesting the state’s provider tax, which taxes 26 not-for-profit Connecticut hospitals, claiming it is unconstitutional and harms hospitals’ finances. The tax was imposed to obtain additional Medicaid funds.
The association filed letters with the state’s Social Services and Revenue Services departments to determine whether the provider tax, which went into effect in 2012, is constitutional. The association claims the hospitals were told their tax dollars would be reimbursed and they would receive additional federal funding.
But since 2013, the association claims, those payments have plummeted and the state is using the money instead to balance its budget.
The Social Services department contends that the provider tax structure is not stripping hospitals of resources, since Medicaid payments from the state to the hospitals increased this year to $1.74 billion from $1.66 billion in 2012.