Minnesota Hospital Association


May 03, 2019

Hospital, health system leaders rally in support of provider tax

ST. PAUL – Two dozen hospital and health system leaders from across Minnesota, part of the Minnesota Hospital Association (MHA), on May 2 joined Governor Tim Walz and Department of Human Services Commissioner Tony Lourey at a meeting and press conference in support of keeping Minnesota’s health care provider tax in place.   

Under current state law, the provider tax, which was created with bipartisan support 27 years ago, will sunset on Dec. 31, 2019. This 2% tax on health care providers, hospitals and wholesale drug distributors has been a critical funding source for affordable health care coverage and has resulted in better health for Minnesotans across the state.   

“These health care leaders care for the real people who will face real consequences if we allow the provider tax to sunset,” said Walz. “They came from all four corners of the state – from Winona to Bemidji and from Mora to Marshall – to stand up for preserving health care coverage.”   

“The end of the bipartisan provider tax would have a devastating impact on not only hospitals, but also the health of the people, families and communities they serve,” said Lourey. “We thank our state’s hospital and health care leaders for their partnership in support of health care coverage for low-income Minnesotans.”   

MHA supports a dedicated, sustainable funding source for MinnesotaCare and for a portion of the costs for people who would have been enrolled in MinnesotaCare but now qualify for Medicaid expansion coverage. Unless the law is changed, the sunset of the provider tax at the end of 2019 would represent a loss of $970 million in dedicated health care funding to the state budget this biennium and a loss of $1.5 billion dollars in the next biennium.   

“The provider tax is a known, reliable, predictable and sustainable funding source that has allowed working families – people who couldn’t get health insurance through their employers and who couldn’t afford to buy it on their own – to obtain coverage through MinnesotaCare,” said Lawrence Massa, president and CEO, MHA. “I’m proud that MHA and our members support keeping the provider tax and putting the patients and the communities we serve first. Minnesotans don’t walk away from proven solutions like the provider tax, especially when doing so would leave our family members, friends and neighbors without access to the health care we all need at some point in our lives.”   

“Keeping our provider tax in place so we can continue providing health coverage for hundreds of thousands of Minnesotans isn’t merely a good thing to do, it’s the right thing to do,” said Dr. Penny Wheeler, president and chief executive officer, Allina Health. “What policymakers knew in 1992 is still true today: a reasonable health care provider tax can fund health coverage so low-income, working Minnesotans can get the care they need – primary care, mental and behavioral health care, prescription drugs, hospital care – at the most appropriate setting, without relying only on the emergency room.”   

“If we care about providing health care in our rural communities – not just care in hospitals and emergency rooms, but in clinics and nursing homes and home health services – we need to make sure people have coverage to keep these services viable and sustainable over the long term,” said Mary Maertens, regional president and CEO, Avera Marshall Regional Medical Center. “Every one of us benefits from keeping the provider tax in place because all of our rural health care system depends on our residents having health coverage.”   

“Minnesota has earned a strong national reputation for making the health of individuals and our communities a top priority. Our long tradition of providing coverage to low-income Minnesotans is a big part of what has made our state’s health care system so great for so long,” said Steven Underdahl, president and CEO, Northfield Hospital. “The provider tax is a key reason for our success in the past – and we need it for Minnesota’s success in the future.”        

The Minnesota Hospital Association represents Minnesota's hospitals and health systems, which provide quality care for their patients and meet the needs of their communities.   

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