May 17, 2017 By Jon Hurst
As the fiscal year 2018 state budget gets closer to implementation on July 1, it is becoming clearer that employers will be asked in some way to help fund a state Medicaid budget gap. The MassHealth budget has exploded under a combination of ACA related costs, mixed up consumer incentives, and a lack of provider expense control. And until the state can institute some guardrails, and move some over to more appropriate and affordable options, it appears that employers will be asked to fund some of the increased costs over a two year period.
Important discussions on the economic impact to small businesses have lowered the dollar ask and have allowed for discussions of better taxing plans, but still absent from the negotiations is skin in the game from the providers themselves. A proposal to cap commercial rate increases for the big, high cost providers was lost in the flood of unparalleled political power by “non-profit,” non-taxpaying healthcare providers. They aren’t shy about asking for more money from consumers, employers and taxpayers, but ask them to pay taxes or reduce their expenses, and they pull out all the stops to deflect the conversation.
Some of these providers are among the largest employers in the state, are far wealthier than most “for profit” employers, yet due to their tax status, they pay no corporate income tax, no commercial property taxes, and incredibly, no sales tax. With their direct tax avoidance they force the rest of us to pay more in taxes. More taxes, on top of uncontrolled, escalating health insurance premiums.
Furthermore, they are arguably given by government an unfair advantage under those tax laws compared to their for profit competitors. Taxes are supposed to not only fund important government services like healthcare, but also create fair playing fields, and incentives to do the right thing. Truly there is nothing like paying taxes to force you to closely examine your expenses and behavior. And ideally the tax system should be set up to make sure everyone is treated fairly and equally by government.