[May 18, 2005]

      Missouri Gov. Matt Blunt (R) on Friday signed legislation (SB 189) that will impose a new tax on Medicaid managed care providers to bring in additional federal dollars, the AP/Kansas City Star reports. The tax, which takes effect with the state budget on July 1, is expected to generate $51.2 million. The additional revenue will be spent on Medicaid, bringing in an additional $73.8 million in federal funds, according to the state Department of Social Services. Of $125 million total, $56 million will be used to increase Medicaid reimbursements to managed care companies, and the rest will be earmarked for general Medicaid spending. State Senate Appropriations Committee Chair Chuck Gross (R) said managed care organizations in the state volunteered to pay the tax as a way to increase Medicaid funding. According to the AP/Star, Missouri already has a Medicaid provider tax for hospitals, nursing homes and pharmacies, and the legislation extends those taxes for an additional year (Lieb, AP/Kansas City Star, 5/16).

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