The just-completed 2021 legislative session might be remembered more for bills that were not passed than for those that were.
While having little in common, it is fair to say that both Medicaid expansion to cover primarily the working poor and House Speaker’s Philip Gunn’s Tax Freedom Act would have been among the most impactful legislation for the state of Mississippi in decades if they had passed. Whether that impact would be beneficial or detrimental, of course, like most things, would be determined over time.
The Tax Freedom Act, authored by Gunn and two of his top lieutenants, Speaker Pro Tem Jason White of West and Ways and Means Chair Trey Lamar of Senatobia, passed the House but did not make it out of committee in the Senate.
The proposal would have phased out the state’s income tax, eventually reduced the grocery tax from 7 percent to 3.5 percent and increased the sales tax on most other retail items from 7 percent to 9.5 percent. In addition, taxes on multiple big-ticket items, such as vehicles and airplanes that have a sales tax rate of 5 percent or less, would also be increased by 2.5 percent on each dollar expended on those items.
Like Gunn’s tax plan, the proposal to expand Medicaid would be significant – perhaps the most significant change to the state’s health care system since Mississippi opted into the original Medicaid health care program in 1969. Incidentally, at the time Mississippi was one of the last states to opt into the Medicaid program, a federal-state cooperative. Proving that history does repeat itself, Mississippi is now among the final 12 states not participating in the expansion. Under the original program, poor children, poor pregnant women, disabled people and a segment of the elderly population are eligible for Medicaid.
With the expansion of Medicaid, up to 300,000 people – primarily the working poor – would be eligible for health care coverage. And importantly, the large bulk of the cost of the expansion would be paid by the federal government. Some opponents of expansion, such as Gunn, say the state cannot afford it, are staunchly opposed and show no indication of changing their mind. Other people, though, argue that the expansion will result in an increase in funds for the state treasury. This is especially true, they say, since the American Rescue Plan recently passed by Congress would provide the state of Mississippi an additional $600 million or more over a two-year period just for expanding Medicaid.
Gunn’s tax swap legislation was killed when the Senate leadership opted not to bring it for consideration. The Medicaid expansion legislation was killed by opposition from the legislative leaders who opted to not even bring the legislation up for consideration in committee.
Democrats, who are in a distinct minority in both the House and Senate, did force a vote on the issue of Medicaid expansion before the full membership of both chambers, but with opposition from Republicans leaders there was no chance the proposal would pass.
“It was a hail Mary,” said Rep. Zakiya Summers, the Democrat from Jackson who offered the proposal on Medicaid expansion to the House, mimicking a throwing motion and comparing herself jokingly to retiring New Orleans Saints quarterback Drew Brees.
While both Medicaid expansion and the tax swap bills are dead for the 2021 session, that does not mean the issues are going away.
Lt. Gov. Delbert Hosemann, spurred at least in part by the speaker’s legislation, said the Senate Finance Committee will study the state’s tax structure during the coming months in advance of the beginning of the 2022 session in January. Lamar, chair of the House Ways and Means Committee, said he anticipates that his committee will participate with the Senate in those hearings.
“We will do everything we can to ensure the legislation is passed,” Lamar said recently.
Hosemann also said the Senate will study the issue of health care assess during the coming months. While he did not specifically say that the study would include Medicaid expansion, he did say that “a moniker” should not prevent a solution from being considered because “if you really look at it, you may not be against that. You may just be against some moniker.”
Legislators did pass some significant bills during the 2021 session, such as providing teachers with a $1,000 per year raise and providing money for a modest pay raise for state employees and an even more modest raise for university and community college staff.
But the issues that were most prevalent and possibly impactful during the 2021 session – taxes and Medicaid expansion – could still be around in 2022.