Obamacare's promise of health care for the poor and uninsured may not be enough to relieve Kansas City taxpayers of their own health care bill.
Today a Kansas City Council committee is set to recommend an April vote on renewing part of a tax that now subsidizes health care for the indigent.
If voters say yes, a property tax described as "temporary" would yield at least $150 million -- through 2023 -- for Truman Medical Center, ambulance service and several neighborhood health centers. All provide free or low-cost services to the area's poorest residents.
"The levy is essential for entry-level health care," said Landon Rowland, co-chair of the Kansas City Health Commission. "It's a low-cost insurance plan for the citizens of Kansas City."
Not everyone, though, thinks a quick decision on extending the city's temporary health levy is necessary.
The Affordable Care Act -- Obamacare -- is supposed to improve health coverage for thousands of the city's poor, they say. By next year, most Americans must carry health insurance or face a tax penalty, a mandate that should mean Truman and the health centers will get an infusion of cash from newly insured patients.
And if the Missouri legislature agrees to expand Medicaid -- admittedly a tough job, despite Gov. Jay Nixon's push -- millions of additional dollars should become available for the area's public health providers. That, in turn, would further reduce the need for local support.
But Kansas City leaders don't want to wait to see whether Obamacare will work as planned.
Instead, they want voters to extend the local health levy -- for another nine years -- before state lawmakers decide on Medicaid and before the financial impact of the individual mandate is known.
"A cynic might think that the city is eager to keep the tax in place, rather than lose it if the state expands Medicaid," said Patrick Tuohey, who has led opposition to local levies in the past and has fought the Affordable Care Act on the state level. "The city could and should wait to renew the tax."
The April referendum wouldn't involve the city's permanent health tax, which costs a Kansas Citian in a $100,000 home roughly $94 each year, not counting cars or other personal property. That tax, with some changes, has been in effect for decades.
Instead, voters would be asked to renew a second, "temporary" health tax before it expires. That part of the levy, first approved in 2005, adds another $43 to the property tax bill of a $100,000 home.
The temporary part of the tax raises roughly $15 million a year. Of that, $10 million goes to Truman, with the rest split between ambulance service and the health centers.
Last year, Mayor Sly James' Municipal Revenue Commission recommended just a four-year extension of the health levy. The Affordable Care Act and the state, commissioners suggested, could cover the poor after that.
Those four years, said commissioner Tim Kristl, were to be "a bridge to Obamacare."
"The nine years," he said, "seems to be over and above that bridge."
Health officials say they're pursuing a nine-year extension because the Affordable Care Act will never be perfect, and local taxpayers must pick up the slack. Promises to seek a regional funding solution for Kansas City's indigent health care, they say, have come up short.
"Does the community at large perceive health care as a common good? I think that they do," said Truman CEO John Bluford.
"Obamacare," said Rex Archer, head of Kansas City's Health Department, "was never supposed to cover the entire safety net."
An April vote is also important, Archer said, because it would allow the city to go back to voters a second time if the tax fails.
Voters actually have at least four opportunities over the next two years to consider extending the levy without risking a lapse in revenue. All of those potential election dates come after the legislature adjourns this year and after it decides the Medicaid issue.
James has argued for months for more spending on the city's crumbling streets and sidewalks, but he supports the April health levy vote.
"Access to quality, affordable health care is beyond the reach of too many Kansas Citians," he said in an email. "Extending the health tax levy at the local level is Kansas City's way of supporting the notion that good health should not be a reality for only those who can afford it."
The proposal to place the extension on the April ballot is expected to pass the full City Council easily. It has been co-sponsored by every member except 2nd District Councilman Russ Johnson.
Johnson said last week he is not necessarily opposed to the extension, but thought questions about the duration of the tax and the impact of expanded Medicaid should be addressed before voters go to the polls.
Stan Dorn, a senior fellow with the Urban Institute in Washington, D.C., said that extending state and local health spending might not be needed if state lawmakers agree to a more generous Medicaid.
But "if Missouri does not expand Medicaid, then public hospitals will continue to need the revenue they've had in the past," he said.
That's because Obamacare won't provide most poverty-level patients with sufficient subsidies to buy their own private insurance, and they won't qualify for Medicaid under current law either. Some 200,000 Missourians might miss out on health coverage if Medicaid isn't expanded.
Many of those patients will turn to Truman for help. Today, Truman provides free or reduced-price care for clients who earn up to 200 percent of the federal poverty level, or $46,100 annually for a family of four.
Additionally, the requirement that virtually all Americans carry insurance might not help as much as originally thought. If Missouri declines to expand Medicaid, Dorn said, poor individuals without coverage won't be penalized -- removing a key incentive to get insurance.
That means thousands of patients might choose to remain uninsured, increasing the pressure on hospitals like Truman. In tax year 2010-2011, the hospital lost more than $18 million in uncollected bad debts, federal records show.
Overall, Truman lost $7.2 million on revenue of $452 million, including nearly $36 million in payments from local taxpayers.
Like all hospitals under the Affordable Care Act, Truman will eventually lose the federal dollars it now gets to cover the cost of treating uninsured emergency patients. Those payments -- known as "disproportionate share" -- now total $80 million a year.
The payments are being phased out because Obamacare assumes patients will have health insurance, in part through expanded Medicaid. That assumption began to change last June, when the U.S. Supreme Court said expanding Medicaid would be optional for states.
Republicans, who control the Missouri legislature, have been skeptical about expanding Medicaid, which is now limited to the state's poorest residents with children. But they have not ruled it out, largely because the federal government has promised to cover the entire cost of the expansion in the first three years.
Some local officials say they're willing to discuss changes in the ballot measure before the City Council locks it in. Some have suggested a lower tax amount, for example, or a shorter extension.
Archer said the council could also repeal the tax in five or six years if the Affordable Care Act provides more money than expected. But an August vote, he says, is too late.
It isn't clear whether any ballot adjustments would satisfy critics, who say the health levy extension comes at the wrong time for cash-strapped Kansas Citians.
"The extra health levy would not only draw money away from Kansas City families already reeling from the recession," said analyst Patrick Ishmael of the Show-Me Institute, a Missouri think tank, "it wouldn't fix the problems of our health care system, either."
