Bill Description: Senate Bill 1350 would increase assessments on private hospitals, in order to further subsidize Medicaid.

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Does it directly or indirectly create or increase any taxes, fees, or other assessments? Conversely, does it eliminate or reduce any taxes, fees, or other assessments?

Senate Bill 1350 amends four sections of Idaho code to increase the monetary assessments the state imposes on hospitals. The stated purpose of the increase would be to "offset general funding needed to support Idaho Medicaid."

During the adoption of the Medicaid FY23 budget motion, the Joint Finance and Appropriation Committee was told that S1350 would be a way to mitigate ongoing General Fund growth in the $4 billion-plus Medicaid budget. 

The notion advanced was that S1350 would increase the federal funds available to reimburse hospitals, which would increase payments to hospitals. The bill would direct the state to seek approval from the federal government’s Center for Medicare and Medicaid Services to update the upper payment limit methodology it uses to pay hospitals. The bill aims to then assess hospitals based on their increased payments and use that money to support General Fund payment increases to other providers. The FY23 budget calls for spending another $200 million to increase rates to providers, and those increases are largely federally funded. There are additional line items increasing funds related to payments for a legal settlement that are also ongoing. 

The purpose of this bill is simply to shift Medicaid provider rate increases from the General Fund to hospitals. It does not confront Medicaid’s exploding budget and its fundamental unsustainability. Instead, Medicaid continues to rely on billions of increasingly borrowed federal dollars. 

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