Tucson hospitals ask to be taxed in order to get matching federal funds

Tucson hospitals ask to be taxed in order to get matching federal funds

TUCSON, AZ (Tucson News Now) - The city of Tucson and local hospitals are teaming up to bring tens of millions of dollars flowing into the city.

St. Mary's Hospital is one of the Tucson hospitals that will benefit from this one-time deal if it's approved.

In fact, there are eight health care facilities in Tucson that could be sharing a windfall from the federal government through the Affordable Care Act.

Tucson Medical Center and University of Arizona Medical Centers are some of the others.

Hospital emergency rooms are where many Tucsonans go when they have no way to pay for health care.

Hospitals call it uncompensated care, and the situation has become worse because of state cuts to the Arizona Health Care Cost Containment System, Arizona's version of Medicaid.

"As a result, for the last few years, all hospitals have seen a significant increase in uncompensated care. Last year alone Tucson hospitals had over $134 million," TMC Chief Financial Officer Steve Bush said.

There's now a one-time program that will help offset some of the losses hospitals suffer.

The program would fill the gap until January 1 when the Medicaid expansion program put in place by Governor Jan Brewer begins.

The hospitals went to the city of Tucson to get the ball rolling to get federal funds to help them as they wait for the Medicaid expansion.

"They came to us and asked us to impose a tax on them--which is kind of man bites dog," Tucson Mayor Jonathan Rothschild said.

The city council voted Tuesday to approve participation in the program.

The tax money collected from the hospitals would be sent to the state which applies for matching funds from the federal government.

Hospitals would then get back the tax, plus the matching funds.

The amount depends on their individual levels of uncompensated care.

End result: About $70 million new dollars come back to the Tucson hospitals and the city's economy.

TMC's Steve Bush says not participating in the program is leaving money on the table.

The plan is not supposed to cost the city of Tucson anything.

"It's just putting $70 million into our economy, and that's something I can't see that we can't use," Rothschild said.

It's also not supposed to cost patients anything.

"The hospitals are not going to raise charges as a result of this. We're not going to change our fee structures as a result of this. Matter of fact, it's in the city ordinance that we're not allowed to pass this assessment on to our patient population," Bush said.

The city of Phoenix already is in the program, as are other cities across the country.

Tucson's participation still has to be approved by the federal government, and that has to be done by the end of September in order to meet the deadline for participation.

Copyright 2013 Tucson News Now All rights reserved.