Discounting all the other reasons to modify or discontinue the North Lake County Hospital District, the new ObamaCare Health Plan may be the final straw for the Tax District, which taxes all property for 1 mill to pay for "continued Hospital Care". As readers of this blog know, we and local activists have pointed out that the law that established the tax district contained no specific requirements, or accountability for how $11-million or more in tax funds were spent by
the two local hospitals that received the funds.
Below is an article describing the reasons for the elimination of the need for such Districts.
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850M in play from health districts
By Leon Fooksman and Tim Collie
4/9/2010 © Health News Florida
The passage of a new federal health law expected to cover most of the
uninsured raises an intriguing question: What will happen to the $850
million raised every year by local taxing districts around Florida to
support care of the uninsured?
At the very least, some health care experts say, taxpayers should expect
a sizeable chunk of that money back beginning in 2014, when the federal
government will provide avenues to coverage to the vast majority of
Florida’s 3.8 million uninsured.
"I don't think local communities are looking at a windfall right away,
but I think you can say there's going to be a significant cost reduction
-- maybe even a very substantial reduction -- in the cost of indigent
care that local communities are paying for through taxing districts
now,” said Bruce Vogel, an economist and expert in health care policy at
the University of Florida. “It's not going to go down to zero, but I
think it will be substantial sometime after 2014."
Under the new law, uninsured persons will get coverage in a number of
ways: through their employers, who will have tax credits and the threat
of fines to encourage them to cover their workers; through expanded
Medicaid, for those who have very low incomes; and through private
policies purchased with federal subsidies.
Up to now, much of the burden for Florida’s indigent care, which can
have a huge impact on hospitals since many poor people are treated in
emergency rooms, has been picked up by a crazy quilt of special taxing
districts often established at the county level around the state.
In Hillsborough County, members of the city council and county
commission are already discussing how the half-cent sales tax that pays
for indigent care can be eliminated in light of the new Patient
Protection and Affordable Care Act.
Tampa City Council Chairman Tom Scott, who is running for mayor, sent a
memo to the Hillsborough County Commission in mid-March suggesting the
tax can be repealed as clients move into Medicaid or private plans. The
county could then lower a proposed 1-cent sales tax, expected to be on
the ballot in November, that is slated to pay for improved bus, rail and
road transportation.
Hillsborough’s health care program, launched in 1992 to care for
low-income residents, is considered a national model. It served some
34,000 people with a budget of $89 million in 2009.
“This is only the beginning – you’re going to see more and more of this
questioning of local health care taxes as communities in Florida look
for more money in the budget to cover the costs of transportation and
other basic services,” said Kathy Harris, a former chief administrator
of human services in both Hillsborough and Broward counties. “It’s an
idea that’s very easy to communicate – if you’ve got a large program and
tax at the federal level, then why are you paying a tax locally?”
In Lake County, a member of the local hospital taxing district’s board
has filed a lawsuit against her own district challenging the
constitutionality of taxing districts. Marilyn Bainter says the
districts are unelected, unrepresentative bodies that control millions
of dollars in taxpayer funds with little oversight.
“I don’t see how, if you’re going to have the federal government
providing health care, you can make an argument that these districts
need to raise more money at the local level,” she said. “These taxes
affect local businesses, and because of this system, you have a
situation in some neighboring counties where there are no taxes, so our
hospitals pick up that burden.
“So now you’re going to have a federal mandate, federal tax increases,
and still make an argument that local counties need to tax for
hospitals?” Bainter added.
But Bainter, Harris and other critics of special taxing districts said
that abolishing these often huge bureaucracies will not be an easy task.
The average citizen is often unaware of how much money these often
obscure bodies collect in their local counties, and many of the district
boards have close ties and revolving door relationships with city and
county officials and members of both the Republican and Democratic
parties in Florida.
“I sit on a six-member board of one of these taxing districts and I can
tell you there’s no interest among the other five in cutting costs, and
certainly not abolishing the district,” said Bainter. “That’s why I
chose to sue. Once these are created, they’re very hard to get rid of.
Who’s going to vote themselves out of existence?
“The local Republican Party isn’t supporting my case, I can tell you
that.”
Florida’s hospital taxing districts have been around for more than 80
years, according to a 2009 Florida TaxWatch report. Their traditional
purposes of providing indigent care and ensuring access to hospitals are
often no longer the main objectives, as the districts compete with the
private sector.
As their roles evolved, the districts have been subject to the same
criticisms as other special districts in Florida: lack of
accountability, mismanagement, escalating taxes, and expansion of
purpose and power, the report said.
In 2007, property tax revenues for the state’s districts totaled $597
million, more than double from the $257 million collected a decade
earlier, the report found.
Six counties, including Hillsborough and Miami-Dade, cover indigent care
through a half-cent or quarter-cent sales tax, generating more than
$250 million in projected revenue for 2010, according to Florida Tax
Handbook.
Officials with several local taxing districts argue that the new law
will leave gaps in the health care safety net, such as some who don’t
buy coverage, preferring to pay a fine. Since Medicaid is expanding and
will require added state dollars by 2019, they say, local areas may have
to kick in for that, too.
“I’m nervous these costs will be passed down to the county,” said Lea
Ann Thomas, who oversees the Polk County indigent HealthCare Plan.
Vogel, the University of Florida economist, agrees that it’s far too
early to tell how much of a savings taxpayers can expect because the
federal regulations that determine how the massive health care reform
plan will be implemented haven’t even been written yet.
"I haven't seen anything, and I haven't read anything, that suggests the
federal government is going to pick up the full tab for indigent care,”
Vogel said. “They're going to pick up a lot of it, most of it, but
certainly not all of it."
Health district officials also argue they have amassed important data
and expertise about the populations of their respective communities that
need to be preserved.
--Leon Fooksman and Tim Collie are independent journalists in
Broward County. Questions and comments can be addressed to Carol Gentry,
Editor, at 727-410-3266.
