Proposal may raise costs, say health care providers

IHC chief calls for study on its impact on insurance rates

Published: Wednesday, Feb. 9, 2005 8:42 p.m. MST
 |  E-MAIL | PRINT | FONT + - 
Tom Henry's proud that Turn Key Service Tech makes health insurance available to the auto shop's seven employees and their families, and that it picks up half the cost. But they could be forced to drop the coverage, he said, if the Legislature passes SB61, a 3 percent gross receipts tax on Intermountain Health Care.

The bill title says it is a tax on privately-owned health care organizations, but it is aimed at and would only tax IHC, which has doctors, hospitals and insurance plans.

IHC president William Nelson said he's most worried about lack of study on the issue to see if the bill would increase health care costs for all insured in Utah, boost the number of uninsured and raise health care and insurance costs statewide. All those are likely to occur, he said during a news conference held at Turn Key in Murray Tuesday morning.

The tax is estimated to generate about $100 million, which would go into the uniform school fund.

Nelson was joined by employers who provide health insurance and representatives of other health insurance plans.

Henry's company is insured by Regence Blue Cross/Blue Shield. Nevertheless, he said, the tax looks like it would raise the cost of insuring each employee by about $85 a month. "I feel it would affect the whole state," he said.

Story continues below

Legislators have told IHC that the bill, sponsored by Sen. Michael Waddoups, R-West Jordan, was created to force IHC to get rid of its health insurance plans, Nelson said.

The effect, according to those at the news conference, would be much more complex, impacting not just IHC, but health care plans that use IHC facilities. It also has potential to send jobs out of state, possibly raise insurance rates for everyone in the state, increase health care costs for everyone and price small employers out of offering medical insurance as a benefit, Nelson said.

It would also severely hamper IHC's charitable care efforts, said Dr. Charles Sorenson, IHC chief operating officer. Last year IHC hospitals and clinics provided more than $67 million in charitable care, not including bad debts that totaled another $80 million. "We are deeply concerned about our ability to continue to do so if this tax is imposed."

The bill would likely increase the cost of insuring Autoliv's 4,500 Utah employees by about $120 each a month, said Scott Baxter of Autoliv. It would "compromise our ability to be competitive in the global market" and make it very hard for employees to afford their share of insurance costs if their premiums increased, he said.

David Call of Deseret Mutual Benefit Association, which insures about 50,000, said his company would likely see its costs go up as much as $1 million a year, which would be passed on to the insured. "The economic theory behind this is very poorly conceived and inconsistent with good judgment," he said.

Comments

You can be the first to comment on this story.

previousnext

Latest comments

I love Millsap, and the Jazz will find a way to move Boozer and match for...

i think its childish to assume that somebody would actually want to get...

Millsap and Boozer need to stay in Utah. Millsap is Boozers backup while he...

Childish and immature? Its always easier being ignorant and presuming things...

can you use words like testimony and church leadership to critisize a...

Bro P really helped me through a tough time in my life when I had him in...

These are only allegations at present, but I hope when he goes to trial, the...

My thoughts are with the Pratt family right now. Michael I hope you are...

It is interesting that everyone who seems to be a member comments on how nice...

You presume, simply because they were gay, that they were trying to "stir...

Advertisements