Healthcare Financial News

Consumers’ ability to afford health insurance and employers’ ability to offer it have been affected by the two recessions of the past decade, according to a new report from the Robert Wood Johnson Foundation. The economic downturn has hit America’s middle class the hardest.

Released in conjunction with the RWJF-sponsored Cover the Uninsured Week, the report shows that the number of middle-income earners who obtained health insurance from their employers dropped by 3 million people from 2000 to 2008. Just 66 percent of people in families earning roughly $45,000 to $85,000 in 2008 have employer-sponsored coverage, a decline of 7 percent since 2000.

Only about half of the decline in employer-sponsored coverage held by middle-income Americans from 2000 to 2008 was offset by government insurance programs. For people who earned less money, declines in employer-sponsored coverage were even steeper, but those numbers were mostly offset by increases in coverage through government insurance programs such as Medicaid.

The Illinois Supreme Court has upheld the denial of property tax exemption for Provena Covenant Medical Center in Urbana, Ill. The supreme court agreed with the state appellate court that the record was inadequate to demonstrate that Provena was a charitable institution. The ruling could have implications for not-for-profit hospitals throughout the nation.

Affiliated with the Roman Catholic Church, Provena Covenant Medical Center is exempt from federal income tax and Illinois sales and use taxes and is regulated in Illinois as a charity. The medical center is one of six hospitals owned by Provena Hospitals, a not-for-profit corporation in Mokena, Ill. The litigation concerns Provena Hospitals’ property taxes for the year 2002. At issue are 43 parcels of real estate in Champaign County. The Illinois Department of Revenue ruled that Provena was not eligible for a charitable tax exemption for 2002. After this ruling, Provena filed a complaint for administrative review in the circuit court of Sangamon County. That court approved the exemption, but the appellate court reversed it and upheld the Department of Revenue’s ruling. Provena then appealed to the Illinois Supreme Court. The supreme court also upheld the Department of Revenue’s denial of a religious exemption.

“We are deeply disappointed” in the decision, said Jon “Cody” Sokolski, chair of the board of Provena Covenant Medical Center. “In 2008, we provided more than $38 million in free care and other community benefits. Our goal is to carry on in our charitable works, despite the fact that this ruling restricts our ability to do so.”

The Illinois Hospital Association (IHA) also expressed disappointment in the decision. “Imposing new tax burdens on a hospital could force it to reduce services and increase healthcare costs, jeopardizing access to quality hospital services as well as the hospital’s financial viability,” said Maryjane A. Wurth, IHA president.

The Congressional Budget Office (CBO) has released projections showing that the current healthcare legislative reform package would cost about $940 billion and reduce the federal deficit by $138 billion over the first 10 years. About two-thirds of the bill’s cost will be paid for through reducing healthcare costs.

The full text of the proposed legislation, which reflects a compromise between the House and the Senate, was released today. That sets the stage for a House vote that could come as early as Sunday. The current legislative package reduces deficit projections by $20 billion more than the bill passed by the Senate on December 24, according to CBO estimates.