Current through Register Vol. XLI, No. 38, September 20, 2024
5.1. The Credit shall only be applied against
the Health Care Provider Tax payable under W. Va. Code §
11-27-16
and may not be applied against any other gross receipts that may be received by
the physician. For purposes of the Credit, the Health Care Provider Tax is
imposed on the gross receipts derived by the physician from the provision of
physicians' services at the tax rate indicated.
5.2. As indicated in the definition of "gross
receipts," the amount subject to the Health Care Provider Tax is the amount
received or receivable, whether in cash or in kind. The term "in kind" as used
in the definition of "gross proceeds" means the fair market value in money, or
of services or property, or the right to receive services, given in lieu of
money.
5.2.1. Initially, fair market value is
considered to be the amount the Health Care Provider charges for the service
rendered. However, the physician may use a lower amount when that lower amount
is an agreed upon amount under a plan negotiated at arm's length with an
unrelated party that is acting in its own best interests.
5.2.1.a. A physician may not use the fees
paid by Medicare or Medicaid as the lowest price paid by a patient for purposes
of measuring the fair market value of services provided free or at a reduced
charge because the physician has not negotiated for the fees at arm's
length.
5.2.2. When the
service is provided at a discount because the patient makes a cash payment, the
amount subject to the Health Care Provider Tax is the amount actually
received.
5.2.3. Unless the
physician is providing a pre-employment physical examination for a person
seeking employment with the physician, pre-employment physicals are subject to
the Health Care Provider Tax; however, if the physician is providing the
examination for a person seeking employment with the physician and there is no
charge, the service is not subject to the Health Care Provider Tax.
5.2.4. When a physician furnishes services at
a reduced price or free of charge to low-income patients, the tax is imposed on
the amount actually received. If the services are provided free of charge,
there is no tax due since the physician does not receive any payment or service
in return.
5.3. A
physician may furnish patient services at no charge or at a reduced charge to
patients who pay for the service (or part of it) by performing a service. While
these situations typically involve the provision of services to employees as
part of the employees' compensation package or services to other patients at a
discount based on the patient's obligation to provide goods or services in
return, they are not limited to only those types of employees or patients.
5.3.1. When a physician furnishes patient
services to its employees at a reduced price or free of charge under a policy
of self-insurance, the taxable amount is the lowest price at which the
physician furnishes similar patient services to other paying patients. This
means that the physician may use the lowest price it charges under a plan
negotiated at arm's length with an unrelated party that is acting in its own
best interests. The plan used for determining the lowest price must still be
open for enrollment.
5.3.1.a. When a physician
furnishes patient services to his or her employees and is reimbursed through
medical insurance the physician purchased for the employees, the physician is
required to pay the Health Care Provider Tax on the total of:
5.3.1.a.1. The amount it receives from the
health plan company;
5.3.1.a.2. Any
co-payments or deductibles it receives from the employee; and
5.3.1.a.3. Any co-payment or deductible
waived by the physician as part of the employees' compensation
package.
5.3.2. Free chest X-rays provided annually to
employees are subject to the Health Care Provider Tax and the amount subject to
the tax is the lowest price at which the physician furnishes similar services
to other similarly situated paying patients under a contract negotiated at
arm's length.
5.3.3. Patient
services provided at a reduced price to employees and their family members are
subject to tax at the lowest price at which the physician furnishes similar
services to other paying patients under a contract negotiated at arm's
length.
5.3.4. Mandated
vaccinations, tests, and free vaccinations provided to employees free of charge
are subject to the Health Care Provider Tax. The taxable amount is the lowest
price at which the physician furnishes similar service to other paying patients
under a contract negotiated at arm's length.
5.3.5. Services given by a physician to
family members or friends are not subject to the Health Care Provider Tax, but
similar services provided to friends are subject to the tax if there is a
charge or any form of barter involved in the transaction.
5.3.6. When a physician furnishes patient
services to other individuals or groups, such as other Health Care Providers,
at a reduced price or free of charge, the gross receipts upon which the Health
Care Provider Tax is measured is the fair market value of the goods or services
provided. The fair market value of the goods or services provided in return by
those individuals or groups shall not be considered.
5.3.6.a. A physician may not use the fees
paid to it by other Health Care Providers under professional discount
agreements for purposes of measuring the fair market value of the services
provided, because those fees do not represent the total amount paid for the
services provided.
5.4. The Health Care Provider Tax rate
applicable to the provision of physicians' services is as follows:
5.4.1. Effective July 1, 2001, this rate is
1.8%;
5.4.2. Effective July 1,
2002, this rate is 1.6%;
5.4.3.
Effective July 1, 2003, this rate is 1.4%;
5.4.4. Effective July 1, 2004, this rate is
1.2%;
5.4.5. Effective July 1,
2005, this rate is 1%;
5.4.6.
Effective July 1, 2006, this rate is .8%;
5.4.7. Effective July 1, 2007, this rate is
.6%;
5.4.8. Effective July 1, 2008,
this rate is .4%;
5.4.9. Effective
July 1, 2009, this rate is .2%; and
5.4.10. Effective July 1, 2010, the Health
Care Provider Tax imposed on providers of physicians' services is
eliminated.
