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A new Cook County tax?

Friday, November 06, 2009
Chicago Tribune
by Chicago Tribune editorial staff

Last week, state lawmakers approved a bill that could finally lead to the repeal of Cook County Board President Todd Stroger's sales tax increase.

There are still some hurdles before the tax is repealed. Gov. Pat Quinn hasn't committed to signing the bill, which would reduce the number of votes needed to override a Stroger veto. There is concern that Stroger will challenge the legislation in court -- and concern that Democrats slipped some wording into the bill that could assist a Stroger challenge.

Hurdles aside, there's a very good chance that the sales tax will be on its way out the door. Taxpayers have been waiting a long, long time for that. Take a look at the calendar at the end of this editorial. We're closing in on 500 days since the tax went into effect.

But you didn't think the tax crowd in Cook County government would go down easily, did you?

No, they're preparing another big tax hike.

This time, the target is hospitals.

Commissioner Mario Moreno is pushing a tax on hospitals that don't devote at least 4.5 percent of their spending on charity care. If they come up short of that target for free health care, they would pay the difference to the county. (Hospitals that handle a high number of Medicaid patients would have a lower target, but could still be snared by the tax.)

Moreno says he doesn't know how much money this would raise.

Well, here's some news for you, Commissioner.

The tax would raise about $340 million a year, according to the Metropolitan Chicago Healthcare Council, which represents 94 Chicago-area hospitals.

It would impose $105 million in taxes on at least 14 hospitals that already lose money.

Four hospitals that now turn a profit would be plunged into a loss.

Great idea, eh?

Moreno says the details are still being worked out and he hopes to have a fleshed-out proposal before the County Board early next year. Moreno says the tax would "encourage hospitals" to provide care to the poor and take the burden off the county's strained public health system.

OK, let's be clear about this. One big reason why the county's public health system is strained is that it wastes money and hasn't collected from patients who have insurance or could afford to pay for their care.

It's clear what's going on here. This is one more attempt to prop up the county's patronage-riddled government, this time at the expense of the private health care system.

Moreno is going to cripple some struggling private hospitals so we can prop up a decrepit public health care system.

We can't do that.

An independent panel now runs the county health system. It has already started to collect tens of millions of dollars more for patient care. It has identified ways to slash tens of millions of dollars in unneeded costs.

As we wrote earlier this week, the only question is whether the political system in Cook County will stay out of the way and let this independent group do its job.

The idea of taxing hospitals based on some charity care standard is fraught with peril. It probably won't account for the money hospitals lose because Medicaid and Medicare don't cover the true costs of care. It probably won't account for all the bad debt that hospitals absorb when uninsured patients don't pay. It probably won't count what hospitals spend on other types of community benefits, such as preventive care screenings. It will create a disincentive for investment.

Cook County has a chance to fix its public health care system. It can't opt instead to cripple many of its private hospitals.


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