Gov. Mike Parson gave Missouri lawmakers until noon today to craft a plan for passing state Medicaid funding by July 1. Without a plan, Parson said he is prepared to withhold funding from a variety of areas, including higher education, social services and health care.
"There is no need to jeopardize our strong economy and thousands of livelihoods to have a fight that erodes the trust Missourians have placed in us to lead," Parson told reporters Monday. "My administration is ready to act on the compromises that have previously been agreed upon."
The Senate failed to pass legislation extending the expiration date of the Federal Reimbursement Allowance - a tax on health care providers that largely funds Missouri's Medicaid budget - after amendments to prevent the use of Medicaid funding for FDA-approved contraceptive medicine or devices and remove Planned Parenthood as a Medicaid provider were added.
Senate Republican leadership then worked with the governor's office to create a plan for a special session last week. That plan maintained a ban on state funding for drugs or devices that are "intended to cause the destruction of an unborn child," and extended the FRA by five years. It did not adopt the second amendment to exclude Planned Parenthood as a Medicaid provider.
The lack of an amendment originally proposed by Sen. Bob Onder, R-Lake St. Louis, derailed the special session plans late last week. Parson said the Legislature must find a balance that funds the FRA and doesn't put the state out of compliance with the federal Centers for Medicare & Medicaid Services.
"Let me be clear: I am pro-life. I have supported pro-life measures my whole career and I always will," Parson said. "However, narrow political interests cannot be allowed to hold hostage vital health care funding and the success of our economy."
Parson said the FRA reduces expenses on the state budget while maximizing the federal funding for the state. Without the FRA extension, the state will be required to close a $1.4 billion funding gap over the next two years. Additionally, payments from the MO HealthNet program would also drop by $1.52 billion in fiscal year 2022 and $2 billion in fiscal year 2023 if the FRA isn't extended.
Parson said the potential cuts he would make if the FRA isn't extended affect almost all state government capacities. He said even pending legislation he has yet to sign into law would effectively be rejected as a result of the funding gap.
Education withholdings would come out of funding for community colleges and four-year universities, capital improvement projects, K-12, school safety planning, the A plus and dual credit programs, career center improvements and school transportation.
Social services withholdings would come out of funding for foster care and adoption services.
Health care would lose funding for nursing homes, independent living centers, emergency management service providers, and health care providers serving those with developmental disabilities and transportation for those individuals.
Parson said the July 1 deadline is in place to keep a balanced budget. Even though the FRA tax expires Sept. 30, Parson said going beyond July 1 would require an emergency clause to go in effect, which he doubts would happen. That would also require the state to resubmit a plan to CMS, which Parson said would likely result in funding loss.
Today's noon deadline allows just enough time for the legislation to go through the House and Senate in five days, he said.
There will not be more opportunities to pass a renewal of the FRA this year if it isn't passed by July 1, Parson said.