Proposed DE hospital levy could generate millions in federal funds for Medicaid
DELAWARE – Medicaid could be getting a major shot in the arm in the First State.
How the Bill Works
The Protect Medicaid Act of 2024 would levy a 3.58% tax on the net patient revenues of Delaware’s acute-care and behavioral health hospitals.
“That will then be matched with the federal funding,” said bill sponsor State Senator Sarah McBride. “The larger health care ecosystem will be made whole, so that none of the cost of that up front investment will be passed onto patients, because the money will stay in health care spending. In total, there will be a pot of $100 million in discretionary Medicaid spending.”
One in three, or about 300,000 Delawareans rely on Medicaid to get healthcare coverage. However, lawmakers say the program is seriously lacking funds in the First State. In fact, Sen. McBride says, Delaware is one of only six states that does not take advantage of funding sources like her proposed bill.
“For Medicaid, every $2 that the state brings to the table, the federal government matches it with roughly $3, which means the more we bring to bear, the more we get,” Sen. McBride said.
Investing in Future Health
Sen. McBride says the state has been trying to boost its Medicaid funding for decades.
If her bill does become law, it would be the largest ongoing infusion of funds into Delaware’s Medicaid funding since the passage of the Affordable Care Act in 2010. And, it would be up to the Delaware General Assembly to determine how best to use that new pot of money.
“This $100 million will allow for better funding of primary care in Delaware, better funding of oral health in Delaware, better funding for community programs,” Sen. McBride said.
Healthcare industry stakeholders were a central part of conversations leading to Sen. McBride’s legislation.
“What we really wanted to see out of this legislation is that, if the hospitals were going to be providing an investment through a provider tax, that we would see a return on that investment in terms of a healthier population,” said Christina Crooks Bryan, Director of Communications and Policy for the Delaware Healthcare Association.
Better Outcomes
Crooks Bryan says the potential for infusion of funds could be especially beneficial to Sussex County’s aging and growing population. “Whether it’s earlier access, or better access to Medicaid, as we get older, for long term care; going to skilled nursing homes,” she said.
And making an investment now means better health outcomes later, says Crooks Bryan.
“You can just look at our hospital emergency departments, as an example. We have seen, unfortunately, that folks without healthcare might use the emergency department for all of their healthcare needs,” Crooks Bryan said. “[Having access to healthcare] can encourage them to see a healthcare provider on the front end, catch those diseases early, manage those chronic conditions well, so that they can avoid and stay out of the hospital as much as possible.”
Looking Ahead
Looking ahead, Sen. McBride is hopeful for bipartisan support of the bill.
“This bill represents a path forward, where no one gets everything they want, but ultimately, the people of Delaware get progress, and we get more resources into our Medicaid program,” said Sen. McBride. “At the end of the day, we have crafted a solution that unites people who, up until this point, had not been able to find common ground.”
The bill has not been formally filed yet. Its first stop will be a hearing in the Senate Health and Social Services Committee.
