MCC Letter of Support to Repeal Sunset of Health Care Provider Tax

Melissa Hortman
Speaker of the House
463 State Office Building

Paul Gazelka
Majority Leader
Minnesota Senate Building, #3113

Cc: Senate Minority Leader Tom Bakk and House Minority Leader Kurt Daudt, and members of the legislature

Dear Speaker Hortman, Majority Leader Gazelka, and members of the legislature,

We write to express our strong support for the proposal to repeal the sunset of the health care provider tax, included in Governor Walz’s budget. The health care provider tax funds essential health care services for over one million Minnesotans and enables critical investments in the health and well-being of Minnesota’s communities.

Allowing the health care provider tax to expire would create an annual revenue shortfall of $680 million. This loss of funding would jeopardize health care access for thousands of low-income Minnesotans, threaten the stability of the health care sector and negatively impact the State budget.

We support the health care provider tax because:

• It has provided a stable source of income for the Health Care Access Fund;
• It has historically funded MinnesotaCare, and with the uncertainty at the federal level it is important we have adequate reserves in the fund to protect the program;
• It is time tested since it was enacted in 1992; and
• It has withstood legal challenges.

In the seven years since the sunset was enacted in 2011, there has been more than sufficient time for possible alternatives to the health care provider tax to be proposed, vetted, and considered. However, no reliable alternative has emerged. Consequently, critical health care services for low-income Minnesotans and innovative community health programs are imminently at risk.

With a projected loss of over $850 million in health care provider tax revenue over the FY20-21 biennium, now is the time to act to save this critical source of health care funding. Therefore, we collectively urge you to act this session to repeal the sunset of the provider tax and remove the cloud of uncertainty over the future of the Health Care Access Fund.

Sincerely,

Minnesota Catholic Conference

PDF version (Includes list of more than 140 organizations that have signed on to this letter.)