Medicaid's growing costs will be a main focus of the Senate Appropriations Committee's work, now that the House has passed its version of Missouri government's more than $23 billion budget plan.
Although they've been meeting since the beginning of the year and discussing the various department requests, the senators at 8:30 this morning will begin work on the official budget plan - and either accept what the House passed, or make changes that would require negotiations with the House before a final plan is sent to Gov. Jay Nixon.
Lawmakers and Nixon agreed last fall to build the budget on an estimated 4.1 percent general revenue growth - a target Senate Appropriations Chairman Kurt Schaefer still thinks is a good one.
"That's just under $370 million of new general revenue," he told reporters at a March 17 news conference, just before lawmakers left Jefferson City for last week's Spring Break. "(But) Social Services' budget, in the budget that we're looking at right now, is increased by $395 million of general revenue.
"That means we would have to take every single dime of GR growth for the entire year, and cut $25 million from somewhere else - presumably public education - and put it towards nothing but Medicaid growth."
Schaefer, R-Columbia, said Medicaid costs - paid through the Missouri Healthnet program - have climbed 32 percent in one year, and more than half the increase comes from prescription drugs.
"The pharmacy line is crazy - pharmacy is growing at a rate that is, absolutely, out of control," he said. "Five years ago, or so, the Medicaid pharmacy line was $900 million.
"It is now $1.8 billion - so it's (about) doubled in five years."
One reason for the increase, he said, has been expensive "specialty drugs" prescribed to treat specific illnesses.
But, he added: "One of the biggest things we're seeing is generics that have been on the market for 30 or 40 years, and used to cost the state $10 for a cycle.
"(Now) you have companies that have bought up those generics and now charge the state, through Medicaid, $300, $400 or $500 for a cycle."
The federal Centers for Medical Services (CMS) hasn't given Missouri officials permission to negotiate better drug costs, Schaefer said. Other states have that authority - but they also run pharmacy costs through managed care, and Missouri doesn't do that.
Pharmacy benefits actually are discretionary, Schaefer said - Missouri could stop using Medicaid dollars for prescriptions.
"But I don't think any of us are going to say it's a good idea to cut pharmacy," Schaefer said. "And how do you balance getting insulin to people who need it, as opposed to some of these specialty drugs that cost $80,000 for a cycle?"
And Medicaid isn't the only budget issue lawmakers must resolve in the next few weeks.
After the House passed the budget May 10, Nixon complained they had removed his plan to increase performance funding for Missouri colleges and universities by $56 million, in exchange for a tuition freeze.
The governor told reporters earlier this month: "All that's going to happen is, tuition's going to skyrocket if the House plan moves forward.
"Make no mistake - all the students who go to school are going to pay more to go to college - at a time when that's not necessary."
Schaefer said his committee will review that House plan.
"I don't think anyone wants to see universities increase tuition anymore," he explained. "That's hard on families and students."
But Schaefer supports the House decision to cut $7.6 million more from the four-campus University of Missouri system.
Many lawmakers are unhappy with the way MU handled student protests at the Columbia campus last fall.
"I think there has to be accountability for bad management," Schaefer explained. "I support the institution. That doesn't mean you support the decision-makers who just happen to be in a particular position at a particular time.
"Bad decisions have to be called out."
Missouri's Constitution gives the nine-member Curators board the power to run the university system.
But, Schaefer has said, lawmakers control the amount of state money that is spent on the school through the budget process.