Rural Georgia hospitals get a quick $60 million infusion of donations

Evans Memorial Hospital in Claxton has been one of the beneficiaries of the rural hospital tax credit

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Evans Memorial Hospital in Claxton has been one of the beneficiaries of the rural hospital tax credit

It took three attempts, but the General Assembly finally hit on the right formula to persuade Georgia corporations and individuals to donate to struggling rural hospitals.

The Georgia Department of Revenue posted a notice Monday — the second day of the new state fiscal year — that the $60 million cap on tax credits to entice donors to rural hospitals had already been reached.

The cap was hit after the General Assembly this year passed legislation giving donors a dollar-for-dollar credit on their income taxes for money they give to one of about five-dozen rural hospitals.

In previous years, the state had offered tax credits worth 70 percent of a donation, and then 90 percent, but neither had corporations or individuals rushing to sign checks.

State Rep. Rick Jasperse, R-Jasper, who sponsored the bill to make the credit worth 100 percent of a donation, called the measure "another example of how we are working together to improve existing programs and implement new measures to support rural health care."

“This tax credit is the kind of program that really makes a positive difference for Georgians,” Jasperse said.

Former state Rep. Geoff Duncan, a GOP candidate for lieutenant governor who created the tax credit program a few years ago, was happy to see the big increase in donations.

“Many of Georgia’s rural hospitals have literally been on life support,” Duncan said. “But the success of this program just goes to show you that neighbors will help neighbors when government gets out of the way and allows Georgia taxpayers to donate to a tremendous cause in their community.”

The state government has committed $60 million a year the next few years to the program. In 2017, before the value of the tax credit was increased, less than 20 percent of the cap room was used by donors.

That rural hospitals need a financial shot in the arm is no secret. At least seven have closed in Georgia since 2010. They have faced a squeeze in reimbursements for Medicare and Medicaid patients; too many people using expensive emergency rooms like their personal clinic; and poor, aging and often declining populations.

After the General Assembly approved the program in 2016, it gained some ill will from top lawmakers when a consultant began signing up rural hospitals to help them raise money. That meant a percentage of the donations intended for struggling hospitals would wind up being paid to the consultant, who maintained that the hospitals didn't have the infrastructure to raise the money.

Most of the more than 50 rural hospitals eligible to receive the donations signed up with the consultant.

Some rural hospitals have benefited. Officials at Evans Memorial Hospital in Claxton told The Atlanta Journal-Constitution last fall that they raised $543,000, most of it from a local company that wanted its donation to remain anonymous.

They said much of the donation money went to improving surgical and imaging services. The hospital was able to buy equipment that allowed it to expand highly reimbursed procedures, such as ERCP tests that check ducts that drain the liver, gallbladder and pancreas. That, in turn, has made it easier to attract patients.

Jimmy Lewis, the CEO of Hometown Health, a coalition of rural hospitals, was ecstatic about the tax credit program’s newfound success. “A silver bullet has been found!!!” he wrote in a bulletin to members.

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