Medicaid provider taxes imperiled as compromise on abortion issues eludes lawmakers


(Missouri Independent) – The pathway to renewing provider taxes essential to funding Medicaid before Missouri lawmakers adjourn for the year became much narrower when issues raised by abortion opponents forced removal of the taxes from a health care bill.

When a conference committee met to work out differences between the House and Senate on the bill, there were fewer than 28 hours left before the mandatory adjournment. And Sen. Holly Rehder, R-Sikeston, said negotiators had agreed to remove the renewal provisions from her bill that began as a proposal to authorize needle exchanges to protect the health of drug users.

“We removed the (tax) language put in on the House floor because if we leave it in, there is a filibuster on both sides,” Rehder said.

State Rep. Mike Stephens, R-Bolivar, said during the meeting he was disappointed that the renewal language was stricken from the bill. 

“I think that not addressing that now guarantees we will have to have a special session,” Stephens said.

Told by Rehder that legislative leaders were working on a solution, Stephens said he wanted to see it finished.

“I hope cooler heads will prevail before we leave here,” he said.

The taxes on hospitals, nursing homes, pharmacies, and ambulances are called the federal reimbursement allowance. They brought $2.3 billion to the state in fiscal 2020 to support the $10.8 billion Medicaid program. The state spent $1.9 billion in general revenue on Medicaid in fiscal 2020.

The taxes, which expire on Sept. 30, are given a short sunset each time they are renewed in part to give lawmakers flexibility to react to changes in federal law. The taxes on providers are used to match federal funds that support Medicaid, and there has been, on several occasions, an attempt by federal regulators to limit the taxes to lower national Medicaid costs.

The taxes were first imposed in 1992 and have been renewed 16 times during regular legislative sessions. 

After the conference committee broke up, the House on Thursday afternoon added the extension language, without the controversial abortion-related provisions, to another bill. But it will face the same issues Rehder’s bill did if it comes up in the Senate for debate.

“We are certainly exploring every option,” said House Budget Committee Chairman Cody Smith, R-Carthage.

The usually routine renewal process came to a halt in late March when Sen. Paul Wieland, R-Imperial, added language that bars using public funds to pay for some contraceptive treatments that also prevent implantation of a fertilized ovum. That amendment, many argued, put the state out of compliance with national Medicaid rules and jeopardized the whole program.

Negotiations resulted in a compromise that made the ban moot if the federal government denied a request for a waiver on contraceptive products and treatments. But a new issue arose when Sen. Bob Onder, R-Lake St. Louis, sought to exclude Planned Parenthood from the list of approved Medicaid providers.

Pushing the years-long fight over abortion rights into the routine tax renewal is a cynical ploy for votes that endangers health care, M’Evie Mead, director of Planned Parenthood Advocates in Missouri, said in a prepared statement.

“The people of Missouri deserve better than to allow two male senators, hell-bent on blocking patients’ access to birth control, on decimating health care access for our state’s most vulnerable people,” Mead said. “Hundreds of thousands of Missourians with low incomes — the majority of whom are women — rely on Medicaid to access health care. Senators Onder and Wieland are jeopardizing the entire Medicaid program over birth control coverage.”

Abortion issues have tied up legislative sessions in the past, forcing lawmakers to return to the capitol for must-pass legislation. In 1997, Gov. Mel Carnahan called lawmakers into special session the minute the regular session ended because they failed to pass all the appropriation bills because of a disagreement over whether Planned Parenthood could provide state-funded family planning services.

Lawmakers are allowed up to 60 days for a special session called by the governor. To allow time to complete renewal before the expiration, lawmakers would have to be in session by mid-July.

Rudi Keller

Rudi Keller covers the state budget, energy, and the legislature. He’s spent 22 of his 30 years in journalism covering Missouri government and politics, most recently as the news editor of the Columbia Daily Tribune. Keller has won awards for spot news and investigative reporting.

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