The Mississippi Division of Medicaid had asked for a $345 million increase in direct state support for the upcoming fiscal year. Senate Appropriations Chairman Briggs Hopson, R-Vicksburg, said negotiators had hoped that number would shrink enough to provide some wiggle room for other funding priorities.
“It did come down some, but it didn't come down to the point where we felt there was enough room to be able to fund much more than Medicaid and education increases,” Hopson said.
In its budget request, the Division of Medicaid said it had burned through its cash reserves, and warned that even a relatively small state shortfall could ripple into a much larger total spending gap because of lost federal matching funds.
Lawmakers did not fully meet that request, but the final Medicaid conference report increases the agency’s General Fund appropriation by roughly $181 million. It also directs $100 million from the Capital Expense Fund to Medicaid operations.
In recent years, lawmakers had held Medicaid funding levels relatively steady while a glut of leftover COVID-19-era funds absorbed cost increases.
“Now we've come to a place where that is not available anymore and we're left looking at other sources,” Hopson said.
Teacher pay is one policy area where the impact of the Medicaid squeeze is most visible. After the House and Senate traded proposals for teacher pay increases as high as $6,000, negotiators settled on a budget deal with a $2,000 across-the-board raise for teachers and another $2,000 for special education teachers. Assistant teachers and school occupational and physical therapists would also get $2,000 increases, while attendance officers would get $5,000 more.
House Education Chairman Rob Roberson, R-Starkville, said lawmakers were not satisfied with where the teacher pay talks ended.
“Neither the House or the Senate are just thrilled that this is where this landed, but that's the money we had left over and we could afford to do,” Roberson said. “We've got good teachers out there that we will never pay the amount, the worth they have.”
Roberson also argued that the smaller raise reflected broader strain across state government, not just in education.
“The reality is, ask the highway patrol what pay raise they got. They got zero,” Roberson said. “We have a real problem across the board with employees that work for the state that deserve pay raises.”
Lawmakers face a Monday deadline for final adoption of outstanding conference reports on appropriation and revenue bills and are on track to conclude the 2026 session later this week.
