NASHVILLE – House members voted 91-5 Wednesday and sent a 3.25 percent “fee” on hospitals to Gov. Phil Bredesen.
“This legislation allows the Tennessee hospitals to step into place on an interim basis to provide critical funding to our TennCare budget,” House Health and Human Resources Committee Chairman Joe Armstrong, D-Knoxville, told colleagues.
The Tennessee Hospital Association sought the one-year measure – which lawmakers argue is a fee or assessment and not a tax increase – because hospitals sought it to avoid massive TennCare cuts. While Gov. Bredesen has not specifically said he will sign it, he and top administration figures have sent strong signals that he will.
It would raise at least $310 million and draw down an additional $582.7 million in federal matching funds, according to a legislative cost analysis. The money would be used to offset hundreds of millions of dollars of pending and proposed TennCare cuts that otherwise go into effect July 1.
Both Democrats and Republicans caucused before the vote, and debate was held to a bare minimum.