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Parson Axes Medicaid Expansion, Setting Up Lawsuit Over Future Of Health Care Program

Missouri Governor Mike Parson addresses senators and an audience gathered in the view gallery during his State of the State address on Wednesday, January 27, 2021, in the Senate Chambers of the Missouri State Capitol in Jefferson City.
Missouri Governor Mike Parson addresses senators and an audience gathered in the view gallery during his State of the State address on Wednesday, January 27, 2021, in the Senate Chambers of the Missouri State Capitol in Jefferson City.

Gov. Mike Parson has pulled out of efforts to expand Medicaid, a move that almost certainly guarantees a lawsuit that could determine the future of a voter-passed initiative bolstering the health care program.

After voters approved a constitutional amendment last year expanding Medicaid, Parson’s administration had sent an amendment to the federal agency that oversees the program to follow through. The amendment would allow someone with an annual income of $17,600, or roughly $36,000 for a family of four, to get coverage.

But the GOP-led legislature declined to fund expansion, citing concerns over the long-term financial impact of the move. In a statement Thursday, Parson said he was withdrawing the amendment to the Centers for Medicare and Medicaid Services that would expand Medicaid.

“I think I’ve been pretty open all along about that,” said Parson on Thursday to reporters in Jefferson City. “I didn’t support it originally. But when the people of this state voted for it, I put it in the budget. I think that was my job as the governor. But I also think the priority is the legislature has to fund it. There’s no other way around that. So when they simply didn’t do that, there weren't a lot of choices left.”

Parson alluded to the fact that had he started enrolling people in the expansion population, the state Medicaid program would have run out of money because lawmakers didn’t appropriate funding. He expects that the issue will end up in court.

“I don’t want to speculate what the courts will do, because there’s a lot of moving parts to this,” he said. “You know there’s going to be court actions on both sides, I’m sure.”

One of the reasons Parson’s decision ensures litigation is that the constitutional amendment includes language requiring coverage for people in the expansion population. What will likely happen is someone will try to apply for Medicaid, get rejected, and then sue in order to get coverage.

If the courts rule that Parson’s administration must let people in the expansion population into the program, lawmakers will be under huge pressure to fund expansion. If they don’t, hospitals and doctors won’t be reimbursed when they provide services to people on Medicaid because the program will have run out of funding.

But if the courts decide that the state doesn’t have to provide health care coverage without funding approval from the legislature, then it effectively renders the Medicaid expansion amendment inoperable.

Senate Appropriations Chairman Dan Hegeman, R-Cosby, acknowledged that the stakes in the impending legal battle are high.

“Basically I think the governor’s responding to the actions of the legislature,” Hegeman said. “The whole issue largely being do initiative petitions have the right to bind the legislature without a funding source. We’ve got a provision in the constitution that says you can’t do that.”

A decision to not go forward with Medicaid expansion would also mean the state would not get more than a billion dollars from the latest federal coronavirus relief plan. A provision in that legislation provides money to states that have not expanded Medicaid yet. Many critics of Republicans refusing to fund expansion have pointed out that this money could be used to pay for the state’s portion of the effort, contradicting the idea that Medicaid expansion would be a financial drag on the state.

“Of course we are extremely disappointed with this,” said House Minority Leader Crystal Quade, D-Springfield. “I will say though, I’m also not surprised. Because we’re continuing to see the administration and the Republican majority just completely not listen to the will of voters and not listen to the constitution.”

This impending court case, which will likely be rendered from the Missouri Supreme Court, could have implications beyond the future of Medicaid expansion.

If the courts rule that expansion must happen, then it could be a pretext for Republicans to try to dismantle the Missouri Nonpartisan Court Plan that is used to select judges to the Supreme Court and the state’s appellate courts. Any changes to the plan would need voter approval.

“We have seen Republicans in Missouri try to undo this court plan for many, many years,” Quade said. “This is just another place where they’re going to try to do it. But we’ll see if they use it as one.”

Follow Jason on Twitter: @jrosenbaum

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