Medicaid is Back in the News, What Does it all Mean???

There seems to be another burst of information about Medicaid in the news cycle, and unless you have been dealing with health care finance for numerous years, it seems pretty arcane and complicated. Kudos to Markian Hawryluk who did an outstanding job of taking this difficult subject and putting it into a reasonably condensed story: $4 billion health care for poor Texans at risk. The sad thing to me is that we don’t really hear much of a policy debate or even a funding debate or discussion going on in Austin; it is simply being rejected due to political bluster.

I will try to explain the steps that have led to the recent outburst of media attention, and like most things in health care, it is never simple. Let’s start with the fact that Texas has barely held together “systems” of caring for low-income Texans by reimbursing health care providers (mostly hospitals who care for people in the ERs) for uncompensated care through a convoluted mixture of local and state dollars matched by federal dollars. We have relied on these matching federal dollars to keep the safety-net health care providers operating since the 1980’s, as the state and local governments in Texas have not had the ability and/or will to meet the needs in the communities.

Interestingly enough, the last time the federal dollars were restricted (in the late 1990’s); we faced a crisis in emergency care that impacted everybody, not just the indigent. It took several years to build back the capacity to meet the increasing demands of a rapidly growing state population. One could argue that we barely have enough capacity to care for what we have on hand right now, let alone future growth. Please understand that these dollars are payments to providers for services to low-income Texans, but if the funds don’t continue in one form or another, all people living in Texas will be facing limited access to care.

Back to our Medicaid funding challenge: in 2010, Texas negotiated with the federal government to move one mechanism of supplemental funding (formerly known as UPL) to a program called an 1115 Waiver. When it was negotiated, the intent of both state and federal governments was for it to fund programs that would be sustainable after the five year timeline because the uninsured would be covered by components of the Affordable Care Act (ACA). This waiver will expire in the end of 2016, and renegotiating this waiver is what has caused all the recent uproar.

It should not be news to you that Texas has rejected any sort of engagement with the federal government on the pieces of the ACA, including covering low income people with a Medicaid expansion or some alternative coverage mechanism. So when the funding from the 1115 waiver ends in 2016 (due to the Supreme Court ruling that this was a state option and not a mandate), the sustainability of the safety-net will again be seriously challenged. Prior to last week, there seemed to be a level of confidence amongst leadership of the Texas Medicaid program in Austin that the federal government would renew or extend the existing waiver with enough funding to help the safety-net providers. Last week, the federal team that negotiates these waivers made it clear (first to Florida, and then Texas), that they would not provide funding for uncompensated care that is provided to patients who should be covered by Medicaid or an alternative coverage mechanism.

So, how did Texas leadership respond? Governor Abbott immediately supported Florida’s lawsuit against the federal government and released a statement that Texas would not expand Medicaid coverage in any way. Lt. Governor Patrick already explained his position by demanding flexibility. From what we can tell, there are no discussions about what really happens to the safety net health care providers or access to health care for Texans across this state, only political statements.

What can we, those of us not in elected leadership positions, do about this? First, we need to push our state leadership to find reasonable and rational pathways forward. While there isn’t any specific legislation to write in to support, you can still demand that they work toward a reasonable solution and stop the political pandering. We cannot accept political bluster; it is only the health care in Texas that is really at stake.

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Medicaid Talks, Tax Cut Challenges, and Looming Lawsuits

Last week started with a very difficult press conference for health advocates. On Monday, March 2, Lt. Governor Dan Patrick and Sen. Charles Schwertner brought together the GOP caucus in the Senate to declare necessary reforms to the existing Medicaid system that must happen before progress on Medicaid expansion could ever be considered. While this may have sounded positive, the stipulations they set out included several “poison pills” that they knew the federal government would not likely approve. The only positive thing that several of us in the health care advocacy community noticed is that neither the Governor nor the Speaker was in attendance. Sometimes we have to look for small victories.

Budget discussions progressed last week with no decisions being made, but the Senate held two days of hearings on several tax cut proposals. These hearings culminated with the Senate leadership laying out a suggestion that tax cuts and debt reduction should not count against the spending cap. The House leadership did not seem to agree with the Senate on this issue immediately either, but it did lay out an interesting opportunity for legislators to consider ways that they could meet several obligations at once with the extra revenue they have this year without having to vote to break the spending cap.

Finally, much attention was on the US Supreme Court which heard the beginning arguments of the King vs. Burwell case. In summary, this critically important case could either reaffirm or discontinue the health insurance subsidies that have helped over a million Texans purchase health insurance this year under the ACA. Most importantly, it shined a light on the opportunities the Texas Legislature has to control its own destiny or be at the mercy of the court. A special thank you to State Representative Chris Turner  who has developed HBs 817 and 818 which would facilitate a state-based exchange and thereby protect the coverage subsidies that so many Texans need to maintain their coverage. We are not optimistic that either of these bills will make it to the Governor’s desk for signature, but it is good to know that there are members of the Legislature that see the challenge and are responding to it.

Now that the introductory committee hearings have all been completed and they are all comfortably staffed and operational, we are expecting substantive bills and decisions to come into focus. Considering we are eight weeks into a twenty week session, things will start to happen quickly.