On February 29, 2024, the Norton County Board of Commissioners voted unanimously to adopt Resolution No. 2024-07_001, which places a special election question before the voters to decide on a 1% sales tax increase to fund healthcare services. This page provides resources to help voters make an informed decision in this election.
Are you curious about the upcoming 1% county-wide sales tax increase proposal to fund healthcare services? Here are some frequently asked questions to help you understand the initiative before the special election on Tuesday, May 7th.
Why is a sales tax needed in order to operate? The primary financial challenges Norton County Hospital (NCH) and Norton County Emergency Medical Services (EMS) face are higher costs of goods and services, lower insurance reimbursement rates, and inflation. This has caused a significant financial burden on healthcare services and facilities nationwide. We have made improvements in our financial bottom line, however, this funding gap can be resolved by additional support or by looking to further reduce expenses by cutting services.
How are healthcare services currently funded? NCH receives funding for patient services from insurance reimbursement and payments from patients. EMS is funded by local taxes and largely by insurance billing and reimbursements either through private insurance, Medicaid, or Medicare. Insurance companies pay on a percentage of charges or fee schedule basis, leaving the facility to write off a portion of the charges. Over the last four years, According to the American Hospital Association, there has been a 10% gap in the increase in healthcare expenses versus insurance reimbursement. This has caused a significant financial burden on healthcare services nationwide, including those in Norton County.
What is a mill levy? A mill levy represents the tax rate applied to the assessed property value. One mill equates to one dollar per $1,000 of assessed value. Therefore, a mill rate of 1 signifies that you pay $1 in taxes for every $1,000.00 of your property’s assessed value. Municipalities calculate your tax obligation by multiplying your property's assessed value by its mill rate, which is established annually. In general terms, the mill levy is determined by dividing the dollars needed for local services by the assessed property value in the service area. (Include current mill levy from County Commissioners)
Why a sales tax increase vs. a mill levy? The state allows for up to a 1% sales tax increase in all counties to be used towards healthcare. A mill levy increase would only affect property owners, increasing their taxes. However, a sales tax increase distributes the burden more evenly across the population and allows us to capture revenue from travel and tourism.
How will the 1% be allocated? The sales tax revenue will be divided .75% to Norton County Hospital and .25% to Norton County Emergency Medical Services, to be used towards healthcare services.
Will it have a sunset period? Yes, the measure includes a 10-year sunset period to provide an opportunity for periodic review and reassessment of the tax increase's effectiveness and necessity.
Are groceries included? What all is included? Any sale made within Norton County would be subject to this sales tax increase, including groceries. While county taxes would indeed go up by 1% with this measure, it's essential to note that state taxes on food sales will be decreasing over the next year, eventually reaching 0%.
Will this measure decrease sales in the county? While there may be a slight initial decrease in local sales due to the tax increase, this measure would allow us to capture revenue generated from visitors. In Norton County, for every $1 spent by locals, another $0.80 is spent by people traveling through the county. This means that nearly 50% of the revenue generated from a sales tax increase would come from travel and tourism.
How will funds be used? After passing the resolution, the hospital administrative team and Board are committed to the following three financial tenants: (1) we will focus on core operations that best support our communities; (2) we will continue vigorously pursuing all revenue opportunities with health plans and government payers; and (3) we will be responsible stewards with this money; through prudent financial management, transparent accounting practices, and strategic investments aimed at enhancing patient care, improving facilities, and supporting staff development. Emergency Medical Services' goal is to maintain the highest level of emergent care possible for the citizens of Norton County. Towards that goal, the funds would be used to better equip and train staff. Areas with increased financial need to maintain quality EMS coverage currently are: (1) Improved or upgraded medical equipment and supplies. (2) Improved outdated training equipment. (3) Support funds to purchased new, or rebuilt, ambulances as the need arises.
Why not increase prices? Most insurance reimbursement is paid by a fee schedule, or a set price for each service; which fall below the actual cost of delivering adequate care, and are non-negotiable. Increasing prices only creates higher write-off percentages and additional out-of-pocket cost for patients. NCH and EMS strive to set pricing for services based on ethical billing practices.
What have you already done to reduce costs at the facility? NCH has worked diligently to decrease expenses without reducing patient services. We have reduced our financial loss over the last year by nearly half a million dollars. NCH has reached a point where we can no longer cut expenses without sacrificing patient services.
What happens if this measure fails? Without additional funding, we will be forced to make difficult decisions, beginning with service reductions, followed by staff reductions, and ultimately risking closure. Norton County Hospital plays a crucial role not only as a healthcare provider but also as an employment and economic driver in our community. As an employment multiplier, NCH generates additional jobs in Norton County, with every one person employed by the hospital creating approximately 0.33 jobs outside of our facility. Moreover, as a dollar multiplier, over 50% of the money we pay out is reinvested within Norton County, contributing to local economic growth.
In essence, supporting the 1% county-wide sales tax increase is crucial for sustaining healthcare services and ensuring the well-being and prosperity of our community. Our healthcare services are a cornerstone of our community's well-being, economy, and vitality. Its absence would have far-reaching and devastating consequences for our entire community. Therefore, we must support and sustain our healthcare services to ensure the continued health and prosperity of our community as a whole.