Nursing home residents would face higher costs under legislation proposed by a liberal Republican and backed by a conglomerate of nursing homes eager for an excuse to raise prices and blame someone else.

State Rep. J.D. Sheffield (R–Gatesville) has proposed a new granny tax – euphemistically calling it a “reinvestment allowance.” Sheffield’s House Bill 2766 would have nursing home providers collect the funds that the state would then disburse back to the nursing homes.

Nursing home providers, speaking through their lobby group, say they want to levy Sheffield’s a state-mandated charge to address “chronic underfunding of nursing home care at no cost to the state.”

The “Texas Health Care Association” may or may not know how to run nursing homes, but they are sorely lacking in basic economic knowledge.

It’s a myth to talk about “cost to the state” for any program. Every program, every expenditure, every tax, is paid by the people. In this case, Sheffield and the THCA want to collect more money from their facilities’ residents in the form of a state fee. This way, the THCA facilities can tell their residents “we didn’t increase your rent, it was the legislature that levied this fee.”

Worse still, the House’s own analysis of Sheffield’s bill notes the program would actually create a “significant fiscal impact” for the state… which, in legislative-speak, is not a good thing. Administration of the program wouldn’t be borne by the “fees” collected but would have to come from the state’s General Fund.

Sheffield and his co-authors – John Zerwas (R–Simonton), Rick Miller (R–Sugar Land) and James White (R–Woodville) – will no doubt brush past such programs with the claim their measure was merely levying a fee the industry wanted. No harm, no foul… for the industry. Big harm, big foul if you’re a nursing home resident or just a regular taxpayer.

This is the worst kind of corporate cronyism attacking Texas’ most vulnerable population. Hiding behind the accounting jargon, HB2766 is a tax on nursing home residents that will be used to pad the bottom-line of nursing home providers.

It shouldn’t escape notice that Sheffield’s tax hike is getting a hearing in the House Human Services Committee, which is chaired by a Democrat.

Michael Quinn Sullivan

A graduate of Texas A&M, former newspaper reporter, one-time Capitol Hill staffer, think tank vice president, and an Eagle Scout, Michael Quinn Sullivan and his wife have three children. He is the publisher of Texas Scorecard. Check out his podcast, “Reflections on Life and Liberty.”

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