Legislative spring break has ended and the Capitol is busier than ever. Soon the Senate will consider the budget as passed by the House of Representatives. The budget is one of the most important things we do in the Legislature and we are constitutionally obligated to pass a balanced budget – one of the best guidelines laid out in our state constitution.
Despite the recent setbacks, our general revenue has increased each year throughout the last decade. The reason for our budgetary concern isn’t as much a lack in revenue as it is a struggle with appropriations; our fiscal footprint is outpacing the growth of our budget. These expenditures are not easily disposable, either. Most of the cost increases have come in areas such as mental health, social services and especially Medicaid. The growth in the cost of Medicaid has outstripped overall revenue growth. This means that Medicaid continues to eat a larger portion of the budget pie and squeezes out priorities like higher education and early childhood education.
According to our Senate Appropriation Records (https://www.senate.mo.gov/17info/2017redbook.pdf), our general revenue has increased by 14 percent between 2008 and 2017. This tells me that lack of revenue is not the problem but rather how the revenue is allocated. The total spending of general revenue that goes toward state medical expenses, however, has increased by 49 percent in the same time. Social Services alone, which includes Medicaid, consumed 17.5 percent of our general revenue funds. General revenue does not include federal funds, it is only the state funds that the General Assembly directly controls.
The more that our money is increasingly appropriated to Medicaid, the less we have to disperse elsewhere. We are spending roughly $32 million less on higher education today than we were in 2008. We already spend dramatically less money on higher education than our neighboring states—Missouri spends 10.68 percent while Arkansas and Kansas both spend more than 15 percent of their general revenue on higher education. What’s most concerning is that these spending rates will presumably continue unless we are willing to make difficult decisions about how we allocate our money.
The rapid growth of Medicaid and medical expenses in general have put the General Assembly in a bind. Core services like primary and higher education are vitally important to the state but the growth of medical expenses means that Medicaid costs more to cover the same number of people every year.
As the Senate considers the budget, these numbers will be on my mind, and I will be looking for options that prioritize things my constituents care about – core services like education.
Thank you for reading this weekly column. Please contact my office at (573) 751-3678 if you have any questions.