NH Reaches Medicaid Enhancement Tax Agreement

State lawmakers have reached agreement on changes to the Medicaid Enhancement Tax to address a court finding that it was unconstitutional.

Gov. Maggie Hassan encouraged the Legislature to pass the bill.

Lawmakers will consider the bill on June 4.

Hassan, in a statement, said: "This agreement is fair to the hospitals and to New Hampshire taxpayers, bringing stability to our budget while ensuring that our hospitals and the state can continue to provide critical health services to our people. I thank Senator Odell, Representative Wallner and the Committee of Conference for their efforts on this legislation, as well as our health care providers, legislative leaders and other stakeholders for their work on the agreement. I encourage the full Legislature to vote in favor of this important measure to protect our budget and the health and well-being of Granite Staters."

Senate President Chuck Morse, R-Salem, said the Senate's focus was on addressing the constitutional questions, reforming how the revenues are spent and reducing the state's reliance on the MET.

"This agreement succeeds in dealing with two of those items by taking appropriate steps to end the current lawsuits while better directing MET revenues to health care related spending," Morse said in a press release. "However, I am very concerned that this settlement increases the state’s reliance on the MET tax and, as a result, raises questions as to whether the agreement will be sustainable in the long-term."

Morse continued:

"Combined with the normal growth in government as well as other health care related spending authorized this year, estimates suggest we could see a more than $1 billion increase in the state’s total spending next budget, a nearly 10-percent increase in our state’s total budget. This is a level of growth that I believe is simply unsound, and will put budget writers in a very difficult position in just over six months when the Fiscal Year 2016/17 budget process begins.

"Over the next few days, as legislators have the opportunity to review this conference report and discuss it with constituents and stakeholders, I would encourage them to fully consider the bill’s implications for our next budget."

The New Hampshire Republican Party panned the compromise legislation.

The GOP statement: "Governor Hassan's continued reliance on the MET to counteract her reckless, wasteful spending habits has left Republicans with no choice but to pursue emergency measures in order to stave off a financial crisis in New Hampshire.  We applaud Republicans who worked to ensure an agreement that MET funds are only spent on healthcare. However, Governor Hassan's incompetence regarding the state budget is inexcusable, and Granite State residents look forward to electing a responsible Republican who will get our financial house in order this fall."