Hospital ends tax credit plan

By MARCIE MILLER

Staff reporter

Whidbey General Hospital commissioners recently voted to take back a gift given to taxpayers in more generous times.

As of Jan. 1 property owners in the hospital district will no longer be able to apply a tax credit toward their hospital bills due to recent changes in federal law.

Under aprogram started in 1988, taxpayers in the district — which encompasses all of Whidbey Island — could deduct the annual hospital taxes they paid from their Whidbey General Hospital bills, after insurance payments.

“It was a gift to the taxpayers, a way to give back to the community,” said Trish Rose, the hospital’s community relations director.

Under the tax credit program, the hospital wrote off on average $2,000 to $2,500 every month for the 10 to 15 people using the program, according to Doug Bishop, Whidbey General’s chief financial officer. The average credit was $200 or less per patient.

Bishop said it remains to be seen whether the hospital will now collect money laid out as recently as credits, or to have more bad debts.

On advice from government auditors, the hospital’s board of commissioners voted to drop the tax credit program rather than face possible legal challenges based on new Medicare compliance laws.

Bishop said Medicare forbids hospitals using inducements — like Whidbey General’s tax incentive — to attract more patients. Some of those patients are likely to be on the federally supported Medicare program. Fewer patients at Whidbey General equals less government spending.

Bishop characterized the law change as a bit strange.

“When’s the last time you saw a hospital having a sale?” he said.

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