SPECIAL Report from the Governor’s office

Governor’s warning: ‘Detrimental consequences’ if stalemate on FRA program not resolved

Posted 6/23/21

JEFFERSON CITY — During a press conference Monday at the State Capitol, Gov. Mike Parson warned of the “detrimental consequences” to Missourians if the Federal Reimbursement Allowances (FRA) …

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SPECIAL Report from the Governor’s office

Governor’s warning: ‘Detrimental consequences’ if stalemate on FRA program not resolved

Posted

JEFFERSON CITY — During a press conference Monday at the State Capitol, Gov. Mike Parson warned of the “detrimental consequences” to Missourians if the Federal Reimbursement Allowances (FRA) and related programs were not extended.
The FRA and related programs provide critical funding to MO HealthNet and must be extended before cost-savings measures are needed on July 1.
“If political maneuvering over extending this program persists, the FY22 budget passed in early May will be in direct conflict with our state’s financial reality come July 1,” said Parson. “My administration will be forced to close a nearly $1.4 billion funding gap over the next two years, which means budget restrictions will have to be made across state government.”
The Fiscal Year 2022 operating budget includes estimated revenue from the FRA program and other allowances, taxes, and assessments to fund primary components of the MO HealthNet program. Failure to extend these programs would cost the state of Missouri an estimated $591 million in FY22 and $788 million in FY23. Payments from the MO HealthNet program would also be reduced by $1.52 billion in FY22 and $2 billion in FY23 if these programs are not extended.
“Some members of the General Assembly have expressed concern about certain health care coverages that are allowed through MO HealthNet that they believe are not Pro-Life. While I disagree with their assertions, a potential call would allow the opportunity for legislators to address these concerns,” said Parson. “Let me be clear: I am Pro-Life. I have supported Pro-Life measures my whole career, and I always will. However, we cannot allow narrow political interests to hold hostage vital health care funding and the success of our economy.”
The governor went on to that that after July 1 “it will be too late, so this is the final opportunity to extend the FRA during a special session. We will continue to work with House and Senate leadership to come to a resolution before noon tomorrow when a decision must be made.”
July 1 is the deadline before budget restrictions and vetoes must be made in order to ensure a balanced budget. Restrictions would have detrimental impacts on state agencies and all Missourians. Budget restrictions and vetoes would include withholds to higher education, K-12 education, social services, health care services, and transportation, among others.
In all, he presented a list of 175 items to cut funding for to reduce approved state spending by $722,166,453.
For a more complete list of potential restrictions and affected institutions, see https://oa.mo.gov/sites/default/files/FY_2022_Expenditure_Restrictions_-_July_1_2021.pdf.

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