HELENA, Mont. — As Republican legislative leaders in Montana girded for this 12 months’s battle over whether or not to increase Medicaid growth within the state, they took purpose at one of many program’s largest backers: hospitals.
If Montana’s hospitals needed to increase the federal government medical insurance program that value taxpayers about $1 billion in 2024, and profit from that income, they need to give one thing again, comparable to extra neighborhood well being care companies and advantages, GOP leaders argued because the session started in January.
However as a substitute, they came upon simply how formidable a political drive the state’s hospitals could be. The hospitals not solely helped steamroll Medicaid growth by the legislature, however in addition they defeated practically all makes an attempt so as to add new necessities to this system and to position new rules on hospitals themselves.
Hospitals opposed and defeated payments to impose value caps and to prominently publish their fees and killed an try and redirect Medicaid funds raised by a hospital tax.
Most Montana hospitals are nonprofit organizations which are largely exempt from state revenue and property taxes. Legislators requested drafts of a number of payments to scrutinize hospitals’ “neighborhood advantages,” the companies they supply free of charge or at discounted prices that justify their nonprofit standing, however didn’t introduce them in the course of the session.
The solely such invoice launched has been considerably amended, on the hospitals’ request.
The state hospital lobbyists’ political pull has annoyed conservative lawmakers in management positions who’re in search of extra oversight of and transparency from the hospitals.
“Hospitals don’t appear to need to come to the desk to debate something, whether or not it’s transparency, controlling prices, or offering extra info to the general public on companies,” mentioned Republican state Sen. Greg Hertz, who sponsored the price-cap invoice that was rejected on the Senate flooring this month.
Hospitals say they’re keen to debate methods to enhance well being care in Montana, and so they level to Medicaid growth as a program whose advantages move to all corners of the state.
But in the case of rules they regard as onerous or criticism that they’re uncooperative companions on well being care coverage, the hospitals aren’t shy about pushing again.
“I don’t assume I’ve ever been approached by any of them on reforming the well being care system,” Montana Hospital Affiliation president and CEO Bob Olsen mentioned of the hospitals’ critics within the legislature. “I believe that we’ve demonstrated that we work on all types of well being insurance policies.”
Republicans maintain large majorities this legislative session and their conservative leaders — most of whom opposed extending Medicaid growth — have typically seen hospitals as a political foe.
However Montana’s hospitals have all the time been a powerful foyer within the state, with bipartisan attraction. The state’s 63 hospitals make use of about 30,000 folks, in line with the MHA, together with lots of the state’s physicians, and have a number of lobbyists on the Capitol, each on their very own and thru the hospital affiliation.
In addition they have a powerful ally in state Rep. Ed Buttrey, a reasonable Republican who is also on the board of administrators of Benefis Well being System. Buttrey sponsored the unique 2015 Montana Medicaid growth invoice and payments to resume this system in 2019 and this 12 months.
Previously 12 months, hospitals labored to kind a coalition with companies, well being clinics, doctor teams, insurers, and advocates for folks with low incomes to push for extension of Medicaid growth, which gives authorities well being protection to about 74,500 low-income, nondisabled Montanans.
Medicaid growth had been set to run out this June, however the invoice extending it breezed by the legislature, passing by snug margins in February, with bipartisan assist. Republican Gov. Greg Gianforte signed it into regulation final month.
The MHA has a political motion committee that donates to a number of lawmakers of each events. In 2024, it paid explicit consideration to allies of Medicaid growth.
The PAC gave $61,000 to the Montana Democratic Social gathering and $75,000 to a political committee that supported reasonable Republicans in contested GOP legislative primaries final June, in line with filings with the state commissioner of political practices.
The majorities that handed Medicaid growth in February included each Democrat within the legislature and lots of the reasonable Republicans supported by the political committee financed partly by the MHA.
Democrats even have been voting nearly universally in opposition to payments that will impose new rules on hospitals.
Hertz’s invoice, which might have capped bigger hospitals’ costs at 300% of the Medicare fee for many procedures, failed on the Senate flooring this month on a 26-24 vote. All however one Democrat and 9 Republicans voted in opposition to it.
State Sen. Cora Neumann, a Democratic member of the Senate Public Well being, Welfare and Security Committee, additionally voted in opposition to a invoice requiring nonprofit hospitals to indicate that their neighborhood advantages meet or exceed the worth of their property tax exemptions.
Neumann mentioned she helps higher entry to inexpensive care in Montana however that “the insurance policies we have now been introduced with are usually not effectively thought out and lift considerations for me about authorities overreach.”
State Rep. Jane Gillette, a Republican who chaired the legislative panel overseeing well being care spending within the state price range, tried final month to redirect a small portion of Medicaid growth funds — $7 million a 12 months — to sure hospitals. The cash is a part of $365 million generated yearly by a tax on hospital companies, and the corresponding federal match, in line with Olsen, the hospital affiliation chief.
Half of the $7 million would go to smaller, impartial hospitals and the opposite half can be distributed to hospitals displaying “distinctive well being outcomes and efficiencies,” she mentioned.
The Home Appropriations Committee agreed March 24 to insert her proposals into the session’s major price range invoice.
However every week later — after hospitals lobbied in opposition to the change — the identical committee torpedoed language in a separate invoice that will have applied the modifications. The following day, on the Home flooring, all however one Democrat and 25 Republicans fashioned a two-thirds majority to take away the funding change from the price range invoice.
“That tells you what a stronghold the hospitals have,” Gillette mentioned. “Even a slight variation to our present system isn’t acceptable to them.”
Olsen mentioned the change would have taken cash from some bigger hospitals and moved it elsewhere, and never essentially to the smaller hospitals Gillette hoped to assist.
“She approached us, however by no means tried to work with us,” he mentioned. “It wasn’t going to succeed in these hospitals that she needed to succeed in.”
Senate President Matt Regier, a Republican, made a final try and insert Gillette’s modification into the state price range invoice on the Senate flooring on April 17, nevertheless it was rejected on a 27-23 vote, with all 18 Democrats and 9 Republicans voting no.
Hospitals are, nevertheless, working with Regier on his community-benefit reporting measure — the last-standing invoice that may impose new rules on hospitals.
The invoice says if the neighborhood advantages reported by nonprofit hospitals don’t equal or exceed the worth of their exemption from property taxes, they need to pay the distinction right into a fund that will be distributed to small, “crucial entry” hospitals.
In the course of the invoice’s preliminary listening to April 2, Regier — a Medicaid growth opponent and generally sharp critic of the hospitals — mentioned he was open to amendments that hospitals may discover acceptable.
The unique invoice cleared the Senate April 5 on a party-line, 30-18 vote, with Republicans in favor. Then, in a Home committee assembly on April 17, Republicans hooked up amendments that had the hospitals’ blessing and despatched the invoice to the Home flooring.
The modifications delay the regulation’s efficient date till 2027 and extra particularly outline the neighborhood advantages that have to be reported and the potential property tax legal responsibility to which hospitals should match their profit.
Olsen mentioned the MHA will assist the amended invoice.
“The reality of it’s, hospitals have all the time far exceeded the tax exemption for neighborhood advantages, on the spending they do,” he mentioned. “Some may fall quick, every so often — however over the lengthy haul, they exceed these exemptions.”
Regier’s try and quantify the quantity and examine it to nonprofit hospitals’ tax exemption isn’t unreasonable, Olsen mentioned: “I’m assured hospitals can do it.”
