The state of Michigan is facing massive budget cuts which will further eviscerate the Medicaid program. If the legislature passes it’s budget as planned, massive cuts to Medicaid will reduce federal matching funds further limiting access to health care for the state’s many uninsured. It’s not clear if there is a way out of this, other than a massive overhaul of the nation’s health care system.
But lawmakers are looking for termporizing measures. One of these is to levy a tax on doctors. This is insane.
Medicaid pays pennies on the dollar so many physicians (my practice included) cannot afford to participate. This means that our already narrow-margin business would be assessed an additional 4% tax on our gross receipts (in addition to income and small business taxes).
There is already a shortage of primary care physicians, and if health care reform passes, more people will have insurance and seek our care. If we tax doctors to provide care, we are shooting ourselves in the neck.
This is not simply a self-preservation issue for me—the abject stupidity of a narrowly-applied tax for a societal benefit is odd, and to apply it to the people trying to provide the service is even crazier. Providers who already take care of Medicaid patients will still pay the tax, but may see a rise in compensation (although I doubt that it will make it profitable to care for these patients).
If this goes through, may practices are going to be in trouble. In addition to cutting our own pay, we will probably have to implement draconian measures such as dropping health care for our employees and probably laying off at least one worker (out of five).
This is a monumentally stupid idea. If you live in Michigan or in any other state where there are such proposals, make some noise.