Hospital, cigarette taxes fail in House

The Mississippi House was unable to garner the three-fifths majority needed Friday to pass a Senate proposal to levy a tax on hospital patients. Neither was it able to pass legislation to increase the cigarette tax.

Lt. Gov. Phil Bryant said taxing the hospitals “made very good sense” and that he was told that the costs would not be passed on to individuals.

On Friday, the House, through an amendment offered by Becky Currie, R-Brookhaven, offered the Senate hospital tax plan to a bill before the chamber. It received only 45 votes while 65 members voted against it.

Then the House Democrats offered an amendment to the same bill to increase the cigarette tax by 50 cents to deal with the shortfall. That proposal passed, but the Democrats were three votes short of the three-fifths majority needed for the final passage of the bill.

With neither side able to able to muster the three-fifths majority needed to pass a tax bill, the leadership offered another option.

That option, which passed 70-41, would require the governor to take money out of the $378 million rainy day fund instead of making Medicaid cuts. Rep. Steve Holland, D-Plantersville, said the rainy day fund would not be needed since cuts would not be required until long after the Legislature was back in the 2009 regular session.

But Holland said it would be “a safety net.”

Barbour said, “The House proposal means next year we will have to come back and find a permanent source of funding for Medicaid. That simply does not make sense.”

Barbour said that if the bill reached his desk, he would veto it and continue with his plan to make cuts, though he did not want to.

He said the hospitals would bear the brunt of the cuts since the shortfall centers on money needed to match federal funds to pay hospitals for treating indigent patients and Medicaid patients.

Since the hospitals would benefit from the federal money, Barbour said, they should provide the state revenue to draw down those funds.

“As usual, the governor’s method of operation is it’s his way or the highway,” said House Speaker Billy McCoy, D-Rienzi. “The House has had an opportunity to vote on every proposal – including his proposal, which was defeated by a wide margin because it taxes sick people in beds….

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