Physicians are urging Hawaii legislators to eliminate the 4 percent medical tax as a way to reduce the burden of healthcare and the physician shortage, NBC affiliate KPVI reported Feb. 7.
Hawaii is one of two states that charge a tax on medical services, according to the report. The 4 percent general excise tax puts an additional burden on physicians caring for Medicare patients, some physicians say.
"Almost all practices lose money caring for Medicaid patients," Scott Grosskreutz, MD, told KPVI. "Hawaii is the only American state which taxes Medicare, Medicaid and TriCare medical care, which is half of Hawaii's population. Healthcare providers have to absorb this tax, which federal Medicare and TriCare policies forbid passing to patients. The GET taxes gross revenues, even when practices lose money providing care, which makes many if not most practices nonprofitable."
Gov. Josh Green, MD, has signaled his intention to reduce taxes on food and medicine, and several bills have been filed in the state's most recent legislative session to entirely or partly remove the general excise tax.