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By Rhiannon Meyers
The Daily News
Published January 7, 2009

County commissioners, in the next few months, will discuss the possibility of creating a hospital taxing district that would pay for health care for some of the county’s working poor.

County Judge Jim Yarbrough said the county may give voters the chance in either May or November to approve a hospital district capable of charging county residents a maximum of 9 cents per $100 valuation to pay for care for some 10,000 county residents with income below the federal poverty level to get treatment at hospitals of their choice. The hospitals would be reimbursed from the taxing district. 

At the proposed tax rate, a hospital district could bring in $15 million. That money could also help pay for countywide emergency medical services. 

Yarbrough discussed the plans in an informal meeting Tuesday attended by state Rep. Craig Eiland, city of Galveston officials, county health district officials,county leaders and The Daily News’ editor and publisher. 

Hospital districts in Texas are typically funded through property taxes, but there’s some hope Galveston County could get permission from the legislature to increase local sales tax to cover the cost, Eiland said. He plans to pitch the idea during the legislative session that starts in two weeks. The sales tax proposal passed the house in 2005 but died in the senate. 

The proposal to allow municipalities to levy a sales tax for health care might gain favor this year with legislators representing Harris County and Houston, where hospitals are seeing an influx in patients since Hurricane Ike slammed into Galveston on Sept. 13, interrupting operations at the University of Texas Medical Branch. John Sealy Hospital, which is still without an emergency room, no longer accepts patients without insurance.  

The sales tax proposal might also be more stable than a property tax, as it is still not clear how badly Hurricane Ike damaged the tax base, said Steve LeBlanc, Galveston’s city manager. 

A hospital district won’t solve all of the medical branch’s funding woes, Yarbrough said. The hospital racks up $40 million a year in charity care; a county hospital tax district, funded at $15 million, would be $25 million short of the total unsponsored care the medical branch provides each year. 

But, if Galveston County voters approve a hospital tax district, it could show legislators residents are making a good-faith effort to fund the medical branch, Eiland said. 

County officials will continue discussions with the leaders of cities throughout Galveston County in the coming months to determine the best way to create the district. A hospital district does not have to cover the entire county. 

A hospital district would give the county’s uninsured and underinsured residents the ability to get treated for diseases and conditions before they worsen to the point of visits to the emergency room, said Dr. Mark Guidry, CEO of the county’s health district. Emergency room care is the costliest care, he said.