Hospital tax would cost SGMC $7 million -, South Georgia News, Weather, Sports

Hospital tax would cost SGMC $7 million

By Jade Bulecza - bio | email

VALDOSTA, GA (WALB) –An administrator at one of our area's largest hospital says his facility would have to make cuts if a proposed new tax on hospitals passes.

Governor Sonny Perdue is pushing a 1.6 percent tax on hospital revenue to help balance the state budget.

The CEO of South Georgia Medical Center in Valdosta says the tax would cost his hospital $7-million a year.

He says they operate on a narrow profit margin and would have to cut salaries, money used to buy equipment and to pay off bonds in order to pay the tax.

"Simultaneously, they're cutting medicaid reimbursement, so we could end up with a double whammy so to speak, both reduced reimbursement for medicaid and having to pay a tax," said James McGahee, South Georgia Medical Center CEO.

He says a tobacco tax is a better option. He says it would help improve health and would generate enough revenue so hospitals wouldn't have to be taxed.

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