This week the U.S. Senate and U.S. House of Representatives approved sweeping tax legislation, sending it to the President for his signature. The President is not expected to sign the legislation into law until early 2018, negating the imminent threat of sequester cuts due to PAYGO rules until 2019.
The good news is that the final legislation does not include a provision removing the current tax exemption afforded to private activity bonds (PABs), as the Wisconsin Hospital Association had advocated (see article here). However, the bad news is the legislation does repeal the tax exemption on advance refunding bonds, and, more importantly, repeals the individual mandate penalty.
“WHA is pleased Congress preserved tax-exempt financing tools for non-profit hospitals, a position advocated by WHA, our members, Governor Walker, Congressman Gallagher and many others from both sides of the aisle,” said WHA President/CEO Eric Borgerding. “However, we are concerned several provisions in the package will negatively impact Wisconsin health care, including the repeal of the individual insurance mandate. With this provision, we see the latest step in the piecemeal deconstruction of Obamacare, but with nothing to replace it, nothing to bridge or transition. This will result in fewer people insured, starting next month, and will most certainly result in higher uncompensated care costs for hospitals and health systems.”