Statement by IHA President Gary J. Fitzgerald on Governor Paterson's Proposed Tax on Hospitals & Nursing Homes

A Most Unhealthy Tax

CLIFTON PARK, NY (03/16/2010)(readMedia)-- "It has been refreshing to see in recent news articles that our Upstate Senators and Assembly members have resisted endorsing tax increases to solve the State's fiscal crisis.

"New York residents continue to pay some of the highest tax rates in the country. Upstate's weak economy would only be made worse by increasing state taxes or creating new taxes. One tax increase that is hidden in Governor Paterson's proposed budget is a special tax on revenues of not-for-profit hospitals and nursing homes. The Governor's tax increase on hospitals and nursing homes (the gross receipts tax, or GRT) would result in those organizations paying $29.4 million in Upstate New York. These funds would go directly into the state's general fund and would not be used to increase or improve access to healthcare.

"Everyone today is well aware of the rising cost of healthcare. Taxing Upstate hospitals and nursing homes just adds to the problem. Hospitals and nursing homes are continuing to work at becoming more efficient so they can survive cuts in payments from Medicaid and Medicare. Taxing these health care providers to balance the State budget limits their ability to provide quality services.

"Hospitals are among the largest employers in Upstate communities. If we impose a tax on our hospitals and nursing homes and limit their ability to provide services, then we also limit payroll and staff, and those effects reverberate throughout the community. The money lost by imposing the GRT may ultimately result in job cuts in the health care industry, which has been one of the only growth industries in the state's economy.

"Upstate New Yorkers need to let their State Senators and Assembly members know that they should reject the Governor's unhealthy tax on hospitals and nursing homes."

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The Iroquois Healthcare Alliance (IHA) represents 57 hospitals and health systems in 31 counties of Upstate New York.