Dentists Concerned About Proposed Provider Tax

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(Host) A proposal by the Shumlin Administration to impose a new health care provider tax on dentists is being closely reviewed at the Statehouse.

The plan is designed to raise $6 million next year, and there are concerns that those costs will be passed along to consumers.

VPR’s Bob Kinzel reports:

(Kinzel) The waiting room at this dental office in central Vermont is filled with patients – some are getting their bi-annual check ups, others are waiting to have their crowns replaced.

The Vermont State Dental Society is concerned that these patients may have to pay more for their services to help subsidize the state’s Medicaid program.  Here’s why.

For every dollar that Vermont raises by taxing a group of health care providers, the state receives a dollar sixty from the federal government in additional Medicaid funds.  These funds can then be used to finance a variety of Medicaid services.

The provider group includes hospitals, nursing homes, managed care companies, and now the governor wants to add dentists to the list.

Peter Taylor is the executive director of the Vermont State Dental Society:

(Taylor) "We’re very concerned about it. It will be passed off to the patients in many instances and in some the dentists may have to absorb the tax and that will have a chilling effect on our recruitment of new dentists to Vermont."

(Kinzel) And Taylor argues that provider taxes aren’t the best way to fund Medicaid services:

(Taylor) "We advocate very much for expanding and having a good Medicaid program for Vermonters who are in need but the funding should be a much broader base revenues either income tax, sales tax or even a tax on soda product.

(Kinzel) Rutland senator Kevin Mullen is the vice chairman of the Senate Health Care committee. He thinks the state is making a big mistake by relying so heavily on these provider taxes:

(Mullin) "The Administration is pushing to max out the cap at 6% when the Obama Administration in Washington is saying over the next couple of years they’re going to reduce that in their efforts to reduce the deficit to 4 ½%.  So we’re building an unsustainable base so we’re just creating more problems for us in the future."

(Kinzel) Susan Besio is the head of the Office of Vermont Health Access.  She says these revenues allow the state to provide critical Medicaid services and she says there is a benefit for the providers:

(Besio) "Most of the providers that we are doing assessments on are proposing to do assessments or increase their assessment amounts this year we’re going to be also raising their Medicaid rates."

(Kinzel) And Besio says it’s important to remember that Vermont uses these provider tax revenues only for health care related purposes:

(Besio) "In many other states that have provider taxes they don’t have that provision so those funds go into the state general fund and can pay for anything."

(Kinzel) Lawmakers are also looking at a plan by the Shumlin Administration to increase its provider tax on hospitals.

For VPR News, I’m Bob Kinzel in Montpelier.

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