As Galveston County inches closer to a November ballot proposal to create a hospital district, its two state representatives suggested a taxing entity to pay for indigent health care may not be the only option.
The state representatives who crafted the legislation to restore and expand the University of Texas Medical Branch did not shoot down an idea floated by County Commissioner Pat Doyle that the county skip creating a hospital district and instead raise the county tax rate.
About $350 million in state funds earmarked for the medical branch are contingent on the county voters either agreeing to create a hospital district to pay for secondary and tertiary care for county residents who are at 100 percent of federal poverty level, or county commissioners could simply vote to provide care at that level.
The $350 million that would be made available once one of those two criteria are met would be used to build a new $150 million hospital tower, as well as $200 million for other enhancements.
The county already provides primary care to the county’s needy at the health district’s 4Cs clinics. Secondary and tertiary care involves specialists and hospitals. The county recently raised eligibility for such care from 21 percent of federal poverty level to 50 percent. A family of four would have to make less than about $4,500 a year to be eligible under the 21 percent rule.
The push to build a hospital district was to avoid the potential tax hike that would subject the county’s tax rate to a rollback election. Funding indigent health care at 100 percent of the federal poverty level would require a significant tax rate hike estimated to be about 5 to 6 cents per $100 in property value.
During an impromptu workshop on the hospital district Tuesday, Doyle suggested if commissioners would take action to raise the eligibility level to 100 percent, a vote on the hospital district would be avoided.
“There should be some options there for people to look at,” Doyle said. “If we ask for this to be a yes-or-no vote on a hospital district, what happens if the answer is no? That puts us in a position where we are forced to do it against the will of the voters.”
Doyle actually envisions having two proposals on the ballot. One to create a hospital district and the other to give county commissioners the approval to raise the indigent care eligibility rate to 100 percent and raise the tax rate accordingly.
It is unclear if the second option would be binding, but Doyle said it would at least give voters an option.
Doyle pointed out that by rolling any new taxes within the existing county tax rate, senior citizens and the handicapped would continue to have their tax rates frozen. That would not be an option when a new tax rate is set for a hospital district.
Doyle has yet to come up with any specifics, but even County Judge Jim Yarbrough, who prefers the hospital district option, said the idea was worth exploring.
State Rep. Larry Taylor, R-Friendswood, said that might be the best route.
“I haven’t heard all of the ramifications, but it seems to be an easier sell to increase to 100 percent,” Taylor said after addressing a group of business leaders at the Texas City-La Marque Chamber of Commerce legislative luncheon on Thursday. “People still hear hospital district and are against it.
“People will vote for a tax increase if you explain what it’s for.”
Given the medical branch’s economic and health care importance to the county, Taylor thinks a hike in the county’s tax rate would be an easier sell — even if it would be subject to a rollback election — than creating another level of bureaucracy and a separate taxing entity.
Taylor cautioned that his comments were based on his first impressions of the idea of a county tax rate hike versus a countywide vote on creating a hospital district.
State Rep. Craig Eiland, D-Galveston, who was the main author of the legislation to restore the medical branch, didn’t disagree.
“I don’t care how it’s done,” Eiland said. “There’s $350 million riding on this decision, and whatever it takes is all that matters to me.”
The key, Eiland said, was that something had to be done sooner than later. Not 1 cent of that money would be made available unless action is taken.
He said the moment either a hospital district garners voter approval or county commissioners vote to increase the eligibility of health care coverage to 100 percent of the poverty level, “cranes would show up at UTMB,” to begin construction on the new hospital tower.
