In a legislative session notable for proposals that seemed designed to outrage one group or another, two bills with wide-ranging implications for taxpayers and college students are moving largely below the radar.

The first is a bill that would dramatically change the way higher education is funded and potentially move significant amounts of money from public universities to private ones. The second would crack down on fraud against Missouri’s Medicaid program by toughening criminal penalties and providing financial incentives for whistleblowers to come forward.

Higher Education

The university bill would set a lid on tuition increases. It would place a cap on the amount of support taxpayers would give to higher education. And it would direct more state money into scholarships that could be used at private universities.

Critics called the bill an attack on public universities. House Minority Leader Jeff Harris, a Columbia Democrat, called the legislation an extremist measure born of Republicans’ simmering disillusionment with public education at all levels.

“Public higher education ought to remain the ticket to the American dream, the ticket into the American middle class,” Harris said.

The bill’s sponsor, Republican Rep. Carl Bearden of St. Charles, said the bill would be a boon to students. The bill would move public money into scholarships for students rather than spending it on institutions, he said.

“I fail to see that when we invest in the future of this state by giving students aid and they can choose where they think they will get the best education, how that is ‘extremist,'” Bearden said.

Bearden’s bill won House approval with just two votes more than the minimum. It was an unusually close vote for a bill sponsored by Bearden and House Speaker Rod Jetton of Marble Hill, the two highest-ranking Republicans in the House.

The vote could reflect opposition from the Council on Public Higher Education, which represents Missouri’s 13 public four-year universities. In an April 3 letter to House members, the council warned that the bill “would severely limit public universities’ capacity to educate students” and “risks seriously compromising the quality of our higher education system.”

The bill limits two of universities’ three sources of funds. Once funding for higher education reaches a certain level, future increases would be directed away from direct support for universities and into scholarship programs. Tuition and student fees could increase by no more than the rate of inflation.

The legislation would create scholarships of up to $1,000 for college freshmen to use at any four-year school.

Barbara Dixon, president of Truman State University and this year’s president of the Council on Public Higher Education, said the bill essentially sets up a voucher program that diverts tax money away from public institutions toward private, often religious, schools.

Officials at Central Missouri State University estimated that the bill would cost it at least $1.5 million next year in lost tuition and fees.

Rep. Judy Baker, a Columbia Democrat, said supporters told her the bill was designed to protect private colleges.

Bearden, who is a fundraiser for Lindenwood University in St. Charles, denied that the bill was intended to benefit private schools.

“If you think it is more important to invest in institutions rather than in students, you won’t like this bill,” Bearden said. The bill is now under consideration in the Senate.

Medicaid fraud

The Medicaid bill is an effort to rein in health care fraud, which experts say steals $200 million to $600 million a year from the Missouri Medicaid program.

The bill is the brainchild of Sen. Chris Koster, a Harrisonville Republican. The legislation toughens criminal penalties, requires most perpetrators to serve prison time and imposes what medical providers call “the death penalty,” a lifetime ban from the Medicaid program for providers who steal from Medicaid.

And it would encourage whistleblowers to come forward by allowing insiders with knowledge of fraudulent schemes to keep a portion of the money recovered.

Koster, a former prosecutor, dismissed complaints that the penalties are too harsh. The vast majority of cases involving improper billing of Medicaid are settled by the provider repaying the money. Only the most egregious violations are referred for criminal prosecution, he said.

“There is absolutely no justification for the state doing business with out-and-out criminals,” Koster said.

The bill attracted opposition from several groups of medical providers, who take in nearly $6 billion a year from Missouri’s Medicaid program. The opposition was led by the nursing home industry, which argued that the bill would turn every disgruntled employee into a potential snitch in hopes of winning a financial settlement.

But Koster said the biggest threat to the bill was a whisper campaign by health care providers who didn’t want to oppose publicly a bill intended to stop theft from taxpayers. But they did not want additional scrutiny of their billing practices.

They are terrified, Koster said, at the idea that overbilling and undue charges routinely added to Medicaid bills would be labeled a crime.

“It is incumbent on Republicans to resist the whisper campaign,” Koster said. “We control the Capitol, and if this doesn’t get through, it’s on our heads. Providers’ strong resistance to this kind of legislation is, at some level, evidence that overbilling is occurring.”

Koster, scoffed at the way medical providers played up the notion that billing the government is full of gray areas.

“They always try to make out that billing Medicaid is somehow a subjective, artistic endeavor,” Koster said. “It’s not interpretive dance. It’s ironic that errors in Medicaid billing always favor the provider, never the state.”

Sen. Chuck Graham, a Columbia Democrat, said the fraud needed to be addressed.

“This is not a victimless crime,” Graham said. “For every person cut from Medicaid, there are health care consequences. And people who commit Medicaid fraud create more victims.”

After Gov. Matt Blunt came out in favor of the bill, opposition in the Senate melted away. The bill is now under consideration in the House.

Kit Wagar is the statehouse correspondent for the Kansas City Star. He can be reached at 816-234-4440 or by sending e-mail to [email protected].