Missouri’s general revenue spending on Medicaid has topped more than 2 billion dollars annually in recent years and its costs are rising.
That’s a problem for Republican State Sen. David Sater of Springfield.
“It continues to be the biggest inflation that we have in state programs, and we have to do something,” Sater says.
The Springfield lawmaker is sponsoring a bill that would require Missouri to seek permission from the federal government to get what’s called a global waiver, basically allowing the state to create its own rules for operating Medicaid.
“We can form the program which is best for Missouri by increasing healthcare and decreasing costs,” Sater says.
The Trump administration is considering allowing states much more flexibility in how they operate their Medicaid programs.
That’s encouraging news to Sater, who sponsored a global waiver last year that did not gain much traction.
Sater’s bill isn’t a detailed blueprint for Medicaid. It’s more like a list of suggestions of possible changes aimed at making the program leaner.
For starters, there could be a requirement that many Medicaid recipients would have to work, although Sater says that doesn’t necessarily mean punching a clock.
“You have to look at the definition of work,” Sater says. “Work can be job training. It can be taking care of a disabled member of the family. Not just a job.”
The bill also suggests introducing deductibles and co-pays, similar to the way private insurance operates. Sater says that would discourage people from getting unneeded emergency care.
“If I have a cold, I don’t just go to the emergency room right off the bat because I know it’s going to cost me $50, $100 extra than if I waited to see a primary care physician the next day, so there’s a deterrent for us to not use the emergency rooms,” Sater says.
The biggest change, however, might be how the system is paid for. Instead of getting money from the federal government based on Missourians’ average income, the state would get a big lump sum to use how it sees fit.
Sater says that sum could be adjusted to account for inflation and the costs of new treatments.
“If you have some new medical technologies that come about, and you’re going to have to have more money from the federal money than what the block grant said, then you can have that,” Sater says.
Global waiver plans like Sater’s are generally opposed by advocates for Medicaid, including State Sen. Jill Schupp, a Democrat from Saint Louis.
“I’m not sure why we would do this at all,” Schupp says.
She says she’s in favor of saving money, but she thinks the steps Sater proposes are the wrong approach because they provide less care.
“Yes, there are cost-cutting measures, but I think that’s very, very short-sighted and at the end of the day are going to end up costing the taxpayers of the state of Missouri and of this nation a whole lot more,” Schupp says.
Instead, Schupp wants to expand Medicaid under the terms of the Affordable Care Act. If the state did that, it would cover around 300,000 more Missourians than now, with at least 90 percent of the added cost being paid by the federal government.
“What we could do is help 300,000 additional people get on the healthcare rolls, be able to make themselves healthy, be able to go to work, be able to take care of themselves and their families, and maybe get them off the Medicaid rolls because they could make more money in the work environment,” Schupp says.
Health experts and many economists agree that Medicaid is effective in keeping medical costs lower because it gives low-income people access to preventive care. That means they won’t get so sick that they need more expensive treatment.
Saint Louis University health law professor Sidney Watson says the program is also pretty efficient.
“The Medicaid costs per person are substantially lower than in private insurance,” Watson says. “Per person costs have been rising slower than in private insurance, and the administrative costs are lower. It’s actually good value.”
Expanding Medicaid would require Missouri to spend more money – about $2.5 billion during the next ten years, according to a Robert Wood Johnson Foundation report. But the state would get an additional $16.5 billion dollars from the federal government.
A 2015 study released by the state of Missouri shows that when the increased tax revenue and the benefits of preventive care are added in, the advantages would be even greater.
“It would cost the state less money to expand Medicaid than what we are doing now,” Watson says.
But the belt-tightening approach favored by Sater and other conservatives has fans in the Trump administration.
The Centers for Medicare and Medicaid Services announced last month it would support work requirements for Medicaid, and Seema Verma, the agency’s administrator, has said she’s agreeable to allowing copays and deductibles.
Although Sater’s plan didn’t get far last session, he’s more hopeful this time around, given the support of the new federal and state administrations.
"Every year that goes by we are spending more on Medicaid and less on higher ed, less on in-home services for people that need health services," Sater says. "So we're having to cut back on things like that to pay for Medicaid increases."
Dan Margolies is a senior reporter and editor for KCUR. You can reach him on Twitter @DanMargolies.
