Comments Made at Competitiveness Panel Underscore Need to Repeal Tax on Surgical Centers

Newly imposed provider tax on Ambulatory Surgery Centers opposed by voters due to threat on state economy, healthcare jobs and affordable patient care

Nov 06, 2015, 14:31 ET from Connecticut Citizens for Affordable Health Care

HARTFORD, Conn., Nov. 6, 2015 /PRNewswire-USNewswire/ -- Connecticut Citizens for Affordable Heath Care (CCAHC), a broad coalition of health professionals and patient advocates mobilizing to preserve patient access to community-based surgical care, today said that recent comments by Speaker of the House Brenan Sharkey to the Commission on Economic Competitiveness further illustrate mounting concerns with the policies included in the Connecticut FY16-FY17 Biennium Budget, including increased taxes on healthcare providers.

One such provision is an unprecedented 6 percent provider tax on freestanding, community-based ambulatory surgery centers (ASCs), which advocates warn puts an important healthcare sector – and critical driver of economic activity and healthcare savings – at extreme risk.  Indeed, ASCs are already subject to state and local taxes, including sales and use, property and state income taxes, through which ASCs contribute significantly to the state's economy.  In some cases, the new 6 percent provider tax results in an effective tax rate of nearly 30 percent on ASCs.

"ASCs are physician-owned small businesses that invest in the local community, support economic growth and employ highly skilled healthcare workers," said Susan Bojka, Administrator of North Haven Surgery Center.  "Due to the new ASC tax included in the budget, estimates predict 25 to 30 percent of our state's ASCs will begin operating at a loss, which significantly threatens our operations and contributions to the Connecticut economy – and more importantly the quality care we provide to hundreds of thousands of patients statewide."

ASCs across Connecticut perform more than 210,000 surgical procedures annually, including orthopedic and spine, ophthalmology (eye), ear, nose, and throat (ENT), and colonoscopies. Many patients prefer ASCs because they are generally more convenient, less expensive and provide more affordable services with the same or better outcomes than hospitals.

Advocates are strongly urging lawmakers to immediately repeal the tax, which data suggest will ultimately drive patients to more expensive care settings, increasing costs to patients and taxpayers.   Medicare and other health plans reimburse ASCs at a rate that is nearly half (55%) of the amount paid to hospital outpatient departments, allowing for significant savings to patients, health insurers, employers, and taxpayers.

"We respectfully ask our policymakers in the General Assembly to take immediate steps to repeal this tax," added Bojka. "If left in place, data shows it will do nothing more than increase healthcare costs to the state."

Results of a new statewide poll released by CCAHC last week show overwhelming opposition to the ASC provider tax. Eighty-one percent of the 400 Connecticut voters surveyed – or 4 out of 5 – disapprove of the tax that could force a quarter of the state's ASCs to operate at a financial loss, risking the availability of same-day surgical care in the community setting patients prefer.

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SOURCE Connecticut Citizens for Affordable Health Care