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Hospital taxing districts could face penalties if they can’t settle claims in 60 days under House bill

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Health care has been extremely partisan in the Legislature these days but there was an unusual bipartisan concern expressed over a bill that would limit a taxing district’s authority to levy ad valorem taxes if they have too many outstanding unpaid claims.

The bill cleared the committee but Republicans and Democrats both expressed concerns that the measure, HB 7115, is punitive to hospital taxing districts, whether they are independent districts or  dependent districts. The bill, to date, has no Senate companion.

Before approving the measure, the committee tacked on a “strike all” amendment. Under the amended bill hospital taxing districts would be banned from levying taxes in fiscal year 2017-18, 2018-2019 and 2019-2020 if their claim denial rates are 10 percent or  more Thereafter, the bar for claims denial rates is is set at 7 percent or more.

Claims that aren’t paid within 60 days by insurance companies or governmental entities would be considered denied under the bill.

Hospitals unsuccessfully argued that the bill targets them but does not impact insurance companies who deny the claims.

The bill appropriates $460,000 to the Department of Financial Services to contract with an approved provider charged with reviewing the taxing districts’ capital recovery reports. Only providers who have been in business for at least five years, have more than 30 certified claims specialists, and earn 85 percent of their revenue from denied claims management, can be contracted for the work.

The specific requirements led state Rep. Mia Jones to suggest that the bill was being pursued because it provides an “opportunity to award a contract.”

Bill sponsor state Rep. Jay Fant testified that there were 170 claims recovery companies that do this kind of work. However, he was unable to answer a followup question as to how many of those companies operate in Florida.

State Rep. Alan Williams suggested that the measure was “a solution in search of a problem.”  Harkening back to House Appropriations Committee Chairman Richard Corcoran‘s remarks on the House floor during the budget debate last week, Williams promised he’d “go to war,” if the bill wasn’t improved before it makes it to the House floor.

State Reps Matt Hudson and Jim Boyd, whose districts include the Sarasota County Public Hospital Board, also expressed concerns that the bill may do more harm than good.

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