2014 Senate Bill 893 / Public Act 161

Re-impose medical services tax to get more federal Medicaid money

Introduced in the Senate

March 27, 2014

Introduced by Sen. Roger Kahn (R-32)

To re-impose a 6 percent use tax on the managed care health care providers (hospitals) that provide most Medicaid services, which is designed to “game” the federal Medicaid program in ways that result in higher federal payments to Michigan’s medical welfare establishment (including those same hospitals). This tax had been suspended 2011 in favor of different version, which did not raise enough to maximize the extra federal increase potential.

Referred to the Committee on Appropriations

May 8, 2014

Reported without amendment

With the recommendation that the substitute (S-3) be adopted and that the bill then pass.

Substitute offered

The substitute passed by voice vote

Passed in the Senate 33 to 5 (details)

Received in the House

May 8, 2014

Referred to the Committee on Appropriations

May 14, 2014

Reported without amendment

Without amendment and with the recommendation that the bill pass.

May 22, 2014

Amendment offered by Rep. Mike Shirkey (R-65)

To earmark some use tax revenue to paying-down unfunded liabilities in the public school pension system.

The amendment failed by voice vote

May 27, 2014

Passed in the House 86 to 24 (details)

To re-impose a 6 percent use tax on the managed care health care providers (hospitals) that provide most Medicaid services, which is designed to “game” the federal Medicaid program in ways that result in higher federal payments to Michigan’s medical welfare establishment (including those same hospitals). This tax had been suspended 2011 in favor of different version, which did not raise enough to maximize the extra federal increase potential.

Signed by Gov. Rick Snyder

June 11, 2014