Sam Brownback's HMO Tax Hikes Hit A Major Speed Bump: A Furious HMO

[DonViejo]

Kansas Gov. Sam Brownback (R) proposed $136 million in taxes on health maintenance organizations as a way of closing the state's budget hole. Now, that proposal is in danger thanks to an angry managed health care company —Aetna, Inc.

According to The Wichita Eagle, leaders at Aetna are warning lawmakers that if Brownback's proposal goes into effect the healthcare company would be hit with $12 million in additional taxes and add $206 to an average HMO insurance policy holder's bill. Brownback's proposal is currently awaiting approval in a House-Senate conference committee.

The warning from Aetna is particularly significant given that it is the biggest of eight insurers that would be hit by Brownback's HMO tax.

Specifically, Brownback is looking to raise a "privilege fee" on annual HMO premiums which is currently at 1 percent. Brownback wants to raise it to 5.5 percent in order to bring in $136 million in new revenues. The $136 million would then be used to replace $80 million in state funds currently going to Medicaid, according to the Eagle. Kansas officials argue that the tax has to go to all HMO companies that offer Medicaid through Kansas's KanCare program.

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http://talkingpointsmemo.com/livewire/sam-brownback-health-tax-hike-aetna

[Erich Bloodaxe BSN]

1. Wouldn't it be amusing if Brownback drove all of the HMO's out of providing insurance in Kansas?

Heck, drive off all the private insurers, and he might have create some sort of, what's the word, 'public' health insurance program for Kansans.