New Budget Proposal Slashes Medicaid Funding and Taxes Hospitals

Georgia Governor Sonny Perdue released a revised budget proposal this Thursday, recommending further spending cuts in nearly every area in response to projections that state revenues would continue to decline. Hospitals would be particularly hard hit under the proposal, which would decrease Medicaid reimbursement rates by 10.25% and eliminate the sales tax exemption for non-profit hospitals.

A spokesman for the Georgia Hospital Association told the Atlanta Business Chronicle that such a steep cut in Medicaid and applying the sales tax to non-profit hospitals would compromise patient care and force some hospitals, including Grady Memorial Hospital in Atlanta, to close.

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