Updated at 9 p.m. with lawsuit filed against the initiative
Missouri Gov. Mike Parson announced Tuesday that the question of whether to expand Medicaid will be placed on the August primary ballot, a move he said is more about policy than politics.
Parson said that expanding Medicaid to insure more low-income people will be a “massive spending initiative” and that the state needs to know where it stands financially.
“Pass or fail, it is important that we understand the implications of what would be a new spending bill out of our already depleted general revenue,” Parson said at his regular press briefing on Tuesday.
He said the state already needs an additional $88 million in revenue through 2021 due to the economic effects of the coronavirus, and if the state decides to expand Medicaid it will have to compete with other state programs for dollars.
“That will compete against the Department of Elementary and Secondary Education,” he said. “It will compete against higher education. It will compete against mental health and public safety. All of those things are a reality.”
Parson did not mention that the federal government will pay roughly 90% of costs associated with expansion, and many studies suggest it would pay for itself.
The state now spends nearly $4 billion to provide Medicaid to people with disabilities, children, pregnant women and some seniors.
The federal government covers about 65% of the cost, and the state covers the rest. However, studies suggest that adding people who make up to 138% of the federal poverty rate — just under $18,000 annually — would mean the state would receive a higher federal reimbursement rate to cover the additional costs. If the program was expanded, an estimated 200,000 people could receive coverage.
According to an independent report in 2019, researchers provided best- and worst-case scenarios for how much money expansion could save or cost. If a larger number of patients who required more expensive care flowed into the program, and if fewer current HealthNet enrollees switched, the expansion could cost the state an additional $42 million. However, if fewer healthier people enrolled, the state could save up to $94 million.
Americans for Prosperity-Missouri filed a lawsuit Tuesday in Cole County Circuit Court challenging the validity of the Medicaid expansion initiative.
“This ballot initiative violates the Missouri Constitution by mandating the state fund the expansion of Medicaid without providing a funding source,” the group’s state director, Jeremy Cady, said in a statement.
Meanwhile, Parson’s likely Democratic gubernatorial opponent, Auditor Nicole Galloway, said the decision to put expansion on the primary ballot instead of the November general election was a “career politician” move.
“He knows that Medicaid expansion is more popular than he is in a general election,” Galloway said in a statement. “He hopes that a smaller electorate will give him a better chance of misleading the voters and defeating it.”
Despite the coronavirus making it nearly impossible to gather signatures, the group backing the plan, Healthcare for Missouri, said it started the process early enough to easily get the necessary signatures required for the 2020 ballot.
The effort has attracted support from hospitals across the state that say expansion is needed in order to keep rural hospitals afloat.
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