Provider Tax Feasibility Study and Recommendation
A contract was awarded in June 2015 to Myers and Stauffer, L.C., an accounting firm that specializes in government health programs, to conduct a health care provider tax feasibility study and recommendation. The scope of work for the contractor included an evaluation of the nineteen classes of health care providers that can be taxed under federal law, and the impact of such a tax or taxes in Alaska. All states, except Alaska, have at least one approved health care provider tax.
From October through December 2015, the department and Myers & Stauffer hosted four public meetings and engaged in several additional sessions with stakeholders most likely affected by a provider tax. Based on this work, Myers & Stauffer concludes that of all the provider classes evaluated, a tax on nursing facilities is immediately feasible in Alaska.
The enclosed report and appendices detail Myers & Stauffer’s findings. The report estimates that if a tax on nursing facilities is structured like other states, Alaska could generate between $2.1 million and $3.7 million in general fund revenue at little to no expense to the health care providers being taxed. The report recommends that the State should wait to implement a tax until it can rerun the nursing facility tax model with current data.
The report includes appendices that show the tax models that were tested throughout the study. The models are in excel format so that the user can change the inputs to see the effect of different tax scenarios.
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If you have questions, please contact Jared Kosin, Office of Rate Review, (907) 334-2447 or jared.kosin@alaska.gov.
November 6, 2015 Alaska Provider Tax Ambulatory Surgery Center and Prescription Drugs Meeting (recording of November 6th meeting)
October 23, 2015 Alaska Provider Tax Nursing Facility and Hospital Stakeholder Meeting (recording of October 23nd meeting)
October 2, 2015 Alaska Provider Tax Feasibility Study Stakeholder Meeting PowerPoint Presentation (audio recording of October 2nd meeting)
Provider Tax Feasibility Study & Recommendation Contract Documents