In early June, Connecticut instituted a $375 million hospital tax increase, adding near-50% to its last reported hospital tax net revenue of $790 million in fiscal 2024. Mostly likely, the increase violated the One Big Beautiful Bill Act, or pre-existing federal law, or both.
The state has offered a confusing and unconvincing defense, claiming to have the approval of Center for Medicare and Medicaid Services (CMS), whose role in the matter is also suspect.
The OBBBA prohibits increases in so-called health care provider tax rates. Even before the OBBBA’s enactment, increases...