Mo. senators cite credit concerns about Medicaid

Published on NewsOK Modified: February 11, 2013 at 6:10 pm •  Published: February 11, 2013
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"It appears to me that what got us the negative outlook, we are simply going to double down on that now if we do Medicaid expansion," Schaeffer added.

House Speaker Tim Jones also raised concerns Monday about the effect of a Medicaid expansion on Missouri's credit rating.

"If you massively expand that reliance on federal spending, I would assume you are going to create that fear even worse in the eyes of the credit reporting agencies," said Jones, R-Eureka.

Nixon's budget director, Linda Luebbering, said the governor is willing to pass a law containing an automatic withdrawal from the Medicaid expansion if the federal government backs off its pledge to provide full funding for the initial years and at least 90 percent funding in future years.

Missouri's accounting chief said that if the state's credit rating is lowered because of the federal government, there would be only a "negligible effect" on the interest rates paid by Missouri.

"Our investors are extremely sophisticated," said Stacy Neal, director of the Division of Accounting in the state Office of Administration. "They can tell the difference between something that's happening at the federal level and we're being impacted by and something that's happening through our specific variables."

New Mexico, Maryland and Virginia all previously had their AAA crediting ratings assigned a negative outlook by Moody's because of their financial links to the federal government. But so far, none of those states has lost its AAA status.

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Associated Press writer Chris Blank contributed to this report. Follow David A. Lieb at: http://www.twitter.com/DavidALieb