Legislation important to the state budget was subject to a political debate this week in the Senate Appropriations Committee.
The federal reimbursement allowance (FRA) program includes taxes on certain medical providers and hospitals in Missouri. The program contributes more than $4 billion in direct and matching Medicaid funding in the state budget. The Missouri Chamber of Commerce and Industry testified in support of the renewal of the program.
The FRA program has been renewed without controversy 16 times after being first enacted in 1992. The most recent renewal, in 2021, required a special legislative session after legislators reached an impasse over an amendment on a topic not directly related to the FRA. That same battle resumed in committee this week, but the committee returned a day later to pass the bill in a 12-1 vote.
Heidi Geisbuhler Sutherland, director of legislative affairs for the Missouri Chamber, said, “The FRA program plays an essential role in Missouri’s economic health and helps keep hospitals open in both rural and urban areas. At the end of the day, employees want to live and work in a place where they have access to quality health care and hospitals.”
Senate Bill 748 is sponsored by committee chair Sen. Lincoln Hough (R-Springfield), who has emphasized the key role the funds play and the need to move away from the recent legislative trend of one-year renewals.
The largest of the four provider taxes included in the FRA program is on hospitals, which accounts for $2.2 billion in direct appropriations for Medicaid. The other taxes are on nursing homes, ambulances and pharmacies. They combine for another $560 million. Federal matching funds raise the economic impact of the FRA program to more than $4 billion.
For more information, contact Geisbuhler Sutherland at hsutherland@mochamber.com or 573-634-3511.
