The program will be governed by a 22-member board of directors comprised of gubernatorial appointees, representatives of regional health policy development districts, and state

officials. The board will reflect the racial and ethnic diversity of the state and will include at least two disabled members. The Governor will also appoint an advisory council in

each of six regional health policy development districts. Each advisory council will assist the board in its planning activities and develop a transportation plan to provide the indigent, elderly, and disabled with access to nonemergency health care services.

The various specific powers, duties, and procedures of the board in administering the program are described. The board may contract with a not-for-profit organization to administer the

program or the separate trust fund created by this act, or both.

The board will develop an annual comprehensive state health plan in conjunction with the regional district advisory councils. It will provide for budgetary and capital expenditure allocations, evaluation of health care needs, and goals for various aspects of the health care delivery system. Limits will be placed on budget requests and administrative expenditures for the program.

Funding for the program will be placed in a separate trust fund. It will be used to establish disease prevention programs, pay health care providers for their services, make grants for health care and medical research, and develop and maintain health care institutions. Federal funding for health professional training will be placed in a separate account and used by the board to train health care providers. For up to 6 years after the effective date, state expenditures for training of health care providers will not fall below 1998 levels.

The program's payment for a covered service will constitute full payment for the service; the patient may not be charged an additional amount. Coverage will include but not be limited to

those services provided under Medicaid, except that certain other types of services are specifically excluded from coverage. Nonmedical residential care services will not be covered, nor will nursing home care for those not eligible for Medicaid, except as provided under Medicare. Insurers, employers, and other health care coverage plans may offer

benefits that do not duplicate coverage offered under the program.

The program will pay the expenses of institutional providers from budgets which will be negotiated annually and will provide for a reasonable margin above operating expenses for capital depreciation and other long-term institutional needs. It will reimburse independent providers based upon fee schedules negotiated with appropriate professional associations elected by the health care providers. Fee schedules set after unsuccessful negotiations may be appealed to the Cole County circuit court.

The program will be partially funded by a tax levied upon employers of nine percent of total wages paid. The employer tax will also be paid by self-employed persons and independent

contractors. When an employer has contracted with an insurer to provide benefits as of the effective date, the employer will receive a credit for the amount of tax and the tax will be paid

by a premium tax assessment levied on the insurer. Collection procedures are described. Tax withholdings which exceed tax liabilities will be refunded. The act also imposes an income

tax surcharge on adjusted gross income above $5,000. The rate of taxation varies with income. The taxes will be levied for all tax years beginning on or after January 1 of the year

following federal approval for funding of this program.

The act establishes an income tax credit of $25 per month per full-time employee for employers of 25 or fewer. The tax credit will be offered for five tax years beginning on or after January 1st after the waiver of federal requirements has been received, with the maximum amount of tax credit decreasing annually during the last four years that the credit is available. The tax credit will be prorated for part-time employees and will not exceed the employer's tax liability.

After this act becomes effective, the Department of Insurance will reduce workers compensation insurance rates to reflect a reduction in employers' liability for medical expenses.

The Department of Social Services will apply for waivers of federal requirements to allow federal Medicaid and Medicare funding to be routed into the program's trust fund and to allow

Missouri residents who are federal employees or retirees to participate. The portion of the act which establishes the new program will go into effect on April 1st of the year following

federal approval for funding of this program.

The entire act is subject to referendum at the November, 1998 general election.

JOHN MESSMER