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Gov. Nixon Joins Business Leaders in Perryville to Discuss Economic Benefits of Strengthening Medicaid, Costs of Inaction

Press Release

Location: Perryville, MO

Gov. Jay Nixon was joined by members of the Southeast Missouri Regional Planning and Economic Development Commission and other area business leaders at Perry County Memorial Hospital today to discuss the benefits of his plan to bring the dollars Missourians send to Washington back to strengthen Medicaid in Missouri, as well as the costs of sending these dollars to other states. The Governor's proposal, endorsed by the Southeast Missouri Regional Planning Commission, would bring $5.7 billion to Missouri and provide health coverage to an additional 300,000 working Missourians over the next three years, at no cost to the state.

"Right now, it's too often easier to get health insurance by losing a job than by taking one. That's not right. Here in Missouri, we believe in rewarding work - and that is what strengthening Medicaid will do," Gov. Nixon said. "Seizing this opportunity to bring the tax dollars that we send to Washington back to Missouri will help working Missourians afford basic health coverage, and create thousands of jobs across our state. That is why business groups in every corner of Missouri and right here in Perryville are backing this plan to strengthen Medicaid the Missouri way. Missourians deserve a health system that reflects our values, but we can't chart our own course if we stand still."

Gov. Nixon's proposal rewards work by giving working Missourians who simply cannot afford health insurance access to basic health coverage. Under the proposed expansion, low-income, working Missourians who can't afford health insurance and earn less than 138 percent of the Federal Poverty Level - or $32,500 a year for a family of four - would be eligible for coverage. Gov. Nixon's proposal also strengthens the economy by spurring job creation throughout Missouri.

Last fall, a study by the University of Missouri found that bringing these dollars back to Missouri to strengthen Medicaid would create 24,000 new jobs in Missouri in 2014 alone. As a result, numerous statewide and southeast Missouri business groups have endorsed Gov. Nixon's plan including the Missouri Chamber of Commerce, Associated Industries of Missouri, and the chambers of commerce in Cape Girardeau, Ripley County, Sikeston and Ste. Genevieve.

Recent studies have also shed light on the high costs of failing to move forward. Hospitals currently receive payments from the federal government for treating uninsured patients, payments that will be cut back dramatically, regardless of the state's decision on Medicaid. If Missouri turns down the federal dollars designed to compensate for those cuts by expanding coverage, hospitals will be forced to cut jobs and reduce services - while families and businesses are shouldered with higher premiums. The Missouri Hospital Association has estimated that that passing up this opportunity to strengthen Medicaid will cost the state 9,000 jobs, increase uncompensated care costs by $11.1 billion, and hike health insurance premiums for families and businesses by more than $1 billion.

"The Southeast Missouri Regional Planning and Economic Development Commission supports Medicaid expansion in Missouri to benefit the families and communities in our seven member counties of Bollinger, Cape Girardeau, Iron, Madison, Perry, St. Francois, and Ste. Genevieve," said board member and Perryville Mayor Debbie Gahan. "If we fail to move forward with Medicaid expansion, communities, families and businesses in southeast Missouri will face higher health care costs and fewer jobs. We must be assured that Missouri's participation is subject to the Federal Government keeping its promise to pay 100 percent for three years while Missouri elected official work during that time frame to modify and improve the plan, ensuring delivery of benefits to those most in need and keeping the cost affordable to our state. To make sure that communities in southeast Missouri continue to grow and prosper, we must move forward on Medicaid."

The impact on Missouri's mental health system would also be significant. In a report released earlier this month, the Missouri Department of Mental Health found that turning down the federal dollars available to strengthen Medicaid will limit access to mental health services and weaken public safety, as hospitals respond to federal cuts by eliminating psychiatric inpatient beds.

"Throughout the country, leaders recognize that moving forward on Medicaid is the smart, fiscally responsible thing to do. Republican governors in Arizona, Florida, Michigan, Nevada, New Jersey, New Mexico, North Dakota and Ohio are strengthening Medicaid to grow their economy and create jobs for their citizens," Gov. Nixon said. "If Missouri fails to act, these other states will get the benefit and we'll get the bill. We should be protecting taxpayers, not sending their money to other states. We must bring our dollars home from Washington to create jobs, improve health care and increase public safety here in Missouri."

Because federal funding will cover 100 percent of the costs for calendar years 2014, 2015 and 2016, expanding health care coverage to those 300,000 uninsured Missourians would involve no state tax dollars for those years. Some of these federal dollars will pay for coverage that is currently being paid for with state dollars. In addition, the economic benefit of expansion will generate additional state revenue. These savings and revenue are conservatively estimated to have a positive impact of $46.6 million in 2014, $125 million in 2015, and $139.6 million in 2016.

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