Local health-care providers said Monday they support a key component of Gov. Jim Doyle’s budget repair bill that calls for an increased assessment of hospitals.

Meriter Health Services in Madison along with University of Wisconsin Hospitals and Clinics said in a statement they supported the proposal.

Supporters of the provision previously stated the hospital assessment would allow the state to increase rates on hospital revenues to compensate for the state’s budget shortfalls.

Hospitals would then apply for increased federal funding, according to the proposal, which would free state funds previously used for Medicaid costs. Doyle has previously stated this would let the state use up to $125 million to help repair the budget.

Wisconsin ranks 49 out of 50 states in the amount of federal dollars given to treat patients who use Medicaid, according to the Meriter release.

However, state Assembly Republicans oppose the assessment and view it as a tax on hospitals.

“Taxes on sick people are not the way to balance the state budget,” said John Murray, spokesperson for state Assembly Speaker Mike Huebsch, R-West Salem.

Linda Reivitz, UW-Madison nursing faculty associate, said the assessment is a tax at least 17 other states have established to accept federal dollars.

According to Reivitz, the hospital assessment would be helpful to provide increased revenues for hospitals that have seen increased demand for health care.

Not taking advantage of an opportunity to secure federal dollars, Reivitz said, would lead to cuts in other programs to compensate for the budget problems.

She said hospitals that would benefit from the assessment are mainly those that provide care for low-income families.

The Wisconsin Hospital Association supports the proposal. “The assessment will gain millions of dollars in federal funding that has been left on the table for far too long, making this a win-win proposition for lawmakers, service providers and patients,” WHA President Steve Brenton said in a statement.