Provider Tax

Well, I don't want to complain about things too much, for the sake of not sounding too negative.

This tax is 2% tax, for me it is an income tax paid every quarter, just like my estimated state income tax of 7%. It is called the provider tax, because only medical providers pay it on revenue generated directly from treating patients. So if you are a Doctor and you work for yourself and all you do is take care of patients all day and that is your only source of income, it is another income tax. It does not exist in any other State. They tried it in a couple other States but it did not work out. It was repealed.

The revenue generated is supposed to go into the fund called the Health Care Access Fund. That fund is supposed to cover the uninsured. Some years that revenue from the Health Care access fund has gone into the General Fund, and been used to cover other debts at the state budget level.

It would not feel so bad paying the provider tax if everyone in Minnesota had health insurance. averaging 2005-07 stats from the Census Bureau, about 8.5% of people in MN do not have health coverage at all. Mass. and Hawaii cover more percentage wise-they do not have a provider tax.

Some legislators like to say with the access fund we do pretty good at covering our uninsured. 21 other States are within 4% points of MN according to the Census. They do not have a provider tax.

It has been challenged at the level of the Constitution- the Minnesota Constitution and been found perfectly legal. No one with any interest, time and money has ever had the fortitude to take it to the level of the United States Constitution.

I have been told in a public forum by one state legislator that, "Well its an unfair tax, but what else can we do?"

The set up is this= as physicians when someone says what else are we supposed to do, as physicians we want to help and fix things, so instead of saying "we are not lawmakers figure it out" we start trying to help the legislature solve their problems. Basically docs believe in social justice, in fairness. Most want to do the right thing. When you back is against the wall, and some legislator says don't you want to cover the uninsured, almost all doctors are going to care and say yes.

The issue is further divisive of the few physicians working in private clinics and practices and those many salaried by huge and smaller corporations be it for-profit, non-profit, foundation etc. You don't really see or feel the provider tax. The institution pays it.

We are short of primary care doctors in rural areas, all things considered if you were a young doctor and you wanted to start a rural private family practice on your own, all other things being equal, and you could go to MN or Iowa, or Missouri, or ND, and you could pay 2% more tax in Minnesota to cover the uninsured, yet lots of you patients would not have health insurance,- it is sort of a disincentive. It is not a way to attract primary cares.

It is analogous to teacher's paying a 2% tax on the income they derive on the teaching they do with each student. Then putting that money back into education, except some years doing whatever you want with that money to pay the state budget.

Protecting the Health Care Access Fund and not use it for other debts besides health care becomes the partisan issue every year within the state government. There are threats to raise it every year, and that 2% has fluctuated a bit over the years.

Yet even with this progressive tax, (its not like a penalty tax or anything) we still don't cover 45,000 or so people in the state, about 8.5 %.

Yet it has been around for some seventeen years.

As doctors we are NOT allowed to complain about it. It is just unacceptable and makes you a bad person and a bad doctor if you even bring it up. What is the first thing the public would say and think if physicians actually got the intitiative and faculty to bring this to societies awarness? I think we all know hwat the public would say and think if physicians complained,
The legislators know this and key on physicians weakness, which is actually self-punitiveness, that is why the tax goes on.

I wonder how people would feel in the United States if everyone's income tax went up 2% to cover the medically uninsured, yet we still didn't cover the uninsured.

It works really well in Minnesota, (or does it?) yet you don't here much about it nationally.