December 31, 2006

Legislative Update - Upcoming 2007 Session

The Missouri General Assembly is gearing up for their regular session, which begins on January 3rd. Staffers are getting file folders ready for pre-filing of bills, which began on December 1st.

The Capitol was almost eerily quiet in the days leading up to the lection, but that's changing now, with interim committees having meetings, members moving to different offices as they gain seniority, and technical staff preparing legislation for pre-filing.

As in the rest of the nation, Democrats gained some seats in the legislature, but the trend wasn't as pronounced in Missouri as in some states. Only two seats changed hands in the Senate, leaving Republicans in control with 21 members, compared to 13 Democrat members. In the House, five seats changed hands, leaving the balance at 91 Republicans and 73 Democrats.

House and Senate party caucuses met following the election to choose their leaders for the next two years. There were no changes in top leadership, with Senator Michael Gibbons of Kirkwood and Senator Charley Shields of St. Joseph continuing as President Pro Tem and Majority Leader respectively. Senator Maida Coleman, City of St. Louis, will continue as Senate Minority Leader. Representative Rod Jetton of Marble Hill will continue as Speaker of the House and Representative Tom Dempsey of St. Charles keeps his role as House Majority Leader. Representative Jeff Harris of Columbia maintained his position as Minority Leader.

While leadership seems quite stable in the General Assembly, there have been quite a number of top leadership posts changing hands in the Blunt Administration, starting with the Governor's chief of staff. Ed Martin replaced Ken McClure, who led Blunt's transition team before becoming Chief of Staff. Martin is a community leader fro the St. Louis area. Two Deputy Chief of Staff positions have also changed in the recent past. Former legislator Chuck Pryor moved from being Legislative Director to Deputy Chief of Staff for Legislation and Policy. State Representative Todd Smith of Sedalia was retiring from the House and Blunt named him to replace Pryor as Legislative Director. Bill Anderson, serving as Health Care Policy Staffer, was promoted to Director of Policy.

Administration changes weren't limited to the Governor's office. In the past few months three major department directors have resigned, with the most recent being the resignation of Julie Eckstein, Director of the Department of Health and Senior Services. She was quickly replaced by Jane Drummond. Drummond was the Governor's legal counsel, and had previously been the Chief Counsel for DHSS. Earlier in the fall, Gary Sherman, Director of the Department of Social Services, and Dr. Michael Ditmore, Director of the Division of Medical Services (Medicaid Program), resigned their positions. Deborah Scott, who had been Deputy Director of Social Services, was named by the Governor to replace Sherman. Long-time Social Services executive Steve Renne was named interim director of the Medicaid program, but a permanent replacement for Ditmore has not been found. Also retiring in the recent past was Dorm Schuffmann, Director of the Department of Mental Health. A replacement for Schuffmann has not been chosen.

Medicaid Reform

These leadership changes in the area of healthcare are particularly interesting in light of the fact that perhaps the biggest chore facing the administration and legislature as they head into 2007 is reconstituting Medicaid. However, former State Representative Jodi Stefanick has been and remains a constant presence in that effort. She was chair of the Medicaid Reform Commission before resigning her House seat and becoming Blunt's Healthcare Policy Advisor, when she became the administration's "point person" in redesigning Missouri's indigent healthcare program.

While legislators were concentrating on the election, the administration was working on Medicaid redesign proposal to present to the legislature in January. Nothing formal has been proposed but a power point presentation outlining a draft proposal has been shared with legislative leaders, some healthcare providers and, after a public record request, with the St. Louis Post Dispatch. From first hand reports, apparently the draft proposal had no significant changes for long-term care programs. However, it's important to note that the proposal was still subject to change by the administration, and then it goes to the legislature for their consideration and possible changes.

Budget

Good news from state government is that revenues have been strong. This fiscal year ended on June 30th with a higher than expected balance in the state's checkbook. The bad news is that passage at the polls of a higher minimum wage for Missouri effective with the new year creates a critical need for more funding immediately for Missouri long-term care providers just to keep them from "losing ground" financially.

State Agencies Issue Medicaid Reform Recommendations

Three state agencies have issued a report and recommendations to the governor regarding Medicaid reform. The "Transformation of Missouri Medicaid to MO HealthNet" report results from the governor's directive for the agencies to analyze the 2005 recommendations of a legislative Medicaid Reform Commission and to develop a reform plan. The governor's office will review the recommendations and develop a legislative proposal to be presented to the Missouri General Assembly in January.

The agencies' recommendations include the following:

• The Medicaid program would be renamed as "MO HealthNet."
• A "health care home" would be developed for enrollees to improve coordination of care and provide a forum for assessing and lowering health risks.
• Enrollees would participate in a health assessment used to generate a plan of care focused to prevention and healthy behaviors.
• MO HealthNet "independence agreements" would be implemented for parents. Modeled on welfare reform agreements between the state and recipients of cash assistance, the independence agreements would be designed to help recipients better health outcomes and "move towards self-reliance." The agencies recommended that this be implemented first as a demonstration project.
• Pay-for-performance reimbursement systems would be developed to provide incentives for meeting evidence-based performance measures.
• Enrollees could qualify for enhanced benefits by participating in initiatives to maintain or improve their health.
• Expanded efforts to combat "waste, fraud and abuse," which would include the enactment of a state Civil False Claims Act modeled on federal law.
• The state should implement a federally-authorized partnership program to encourage the purchase of private long-term care insurance.
• To promote expanded coverage of the uninsured, the report recommends implementing a premium offset program to promote coverage of employees with incomes below 200 percent of the federal poverty level who work in small firms. A portion of the cost of the program would leverage state and federal matching funds.

Legislative Leader Ready for Health Care Reform

State lawmakers failed to act this year on any of the recommendations made by the Medicaid Reform Commission, but just might get to them this year. Senator Charlie Shields (R-St. Joseph) chaired the Medicaid Reform Commission. It met throughout the summer of 2005, settling on recommendations it forwarded to the legislature. The legislature, though, didn't act on the recommendations. Shields says the commission wants a state health plan to be consumer driven, with much moved to the private sector, while the Blunt Administration has focused on changing internal state operations. The governor has yet to unveil details of his plan. Shields believes the two proposals can be reconciled and must be this year, since the legislature has placed a 2008 sunset on the current Medicaid program. Shields says it's unacceptable to have up to 20% of Missourians without health care coverage. He says everyone at the Capitol agrees things must change; now it's up to the various sides in the issue to come to agreement on a proposal. Shields says the five month legislative session is plenty of time to create a new health care system.

House Democrats Have Own Medicaid Ideas

House Democrats have their own thoughts about how the Medicaid program should be reshaped. State Representative Margaret Donnelly (D-St. Louis) says the Democrats will base proposals on a simple principle: that any new plan has to ensure that more Missourians, not fewer, receive health care. Democrats also want the legislature to restore Medicaid cuts made in 2005. There are about 100,000 fewer Missourians on Medicaid than in 2005. Donnelly isn't pleased with the proposals being floated by the Blunt Administration. She doesn't care much for recommendations of the Medicaid Reform Commission, either, a commission she was a part of that submitted its recommendations last year. Donnelly says the commission missed the mark, because they failed to go back to a fundamental principle; that any plan should cover more people, not fewer. Donnelly says that with the state budget improving, the Medicaid cuts have been proven to be unnecessary.

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