by Becca Aaronson

Despite Gov. Rick Perry remaining strongly opposed to expanding Medicaid, a House panel on Tuesday considered legislation that would expand coverage to poor adults under the Affordable Care Act.

“This is not Medicaid expansion; this is Texas Plus or Medicaid Plus One,” said state Rep. Sylvester Turner, D-Houston, who laid out his House Bill 3376 at the House Appropriations Subcommittee on budget transparency and reform.

HB 3376 would expand Medicaid coverage to individuals below 133 percent of the federal poverty line. The bill includes a severance clause that requires the state to stop financing the program if the federal government reduces its share of financing below 90 percent and — “in the spirit of conservatism,” as Turner put it — also includes cost-sharing requirements such as co-payments.

“I don’t think anyone can dispute the numbers. We may dispute whether or not we want to do it,” said Turner, emphasizing that the state comptroller estimates expanding Medicaid coverage as proposed in HB 3376 would save the state $50.4 million in the 2014-15 biennium. “From a fiscal, financial, budgetary point of view, the numbers are overwhelming.”

Health care providers, advocates and religious leaders overflowed the committee room to testify in favor of the state expanding Medicaid coverage. Anne Dunkelberg, associate director and health policy analyst with the left-leaning Center for Public Policy Priorities, testified that health care premiums can consume 40 percent of a low wage earner’s income, prohibiting the working poor from purchasing coverage.

But not all lawmakers seemed swayed by the testimony.

“We always paint a picture of people crying in bed at night because they don’t have health insurance, and I really don’t think that’s true,” said Rep. Myra Crownover, R-Denton, the chairwoman of the subcommittee. She gave the example of healthy, uninsured adults she knows who do not think they need health insurance. “Everybody really wants car insurance when they have a car wreck, [but] they’d like to drive around uninsured if they could get away with it,” she said.

A report by Billy Hamilton, the state’s former budget estimator and former deputy comptroller, estimates the state could achieve even greater savings by expanding Medicaid — $1.2 billion in the 2014-15 biennium, as Texas would spend less on other health programs to cover poor populations. Hamilton also estimates the Medicaid expansion would cost Texas $15 billion over 10 years, while allowing Texas to draw down $100 billion in federal financing. Another report by the Hobby Center estimates as many as 4.4 million of the 5.8 million Texans without insurance in 2010 could have insurance by 2014, depending on how federal health care reforms are implemented.

But Perry and other opponents of expansion say that Medicaid is broken and that expanding Medicaid under the Affordable Care Act would compound the exponentially rising costs of Medicaid.

These Texas Tribune interactives show the economic impact of the Medicaid expansion by legislative district, and the effects on uncompensated care and the rate of uninsured by county. Texas Impact and the Methodist Healthcare Ministries of South Texas commissioned the reports.

Kevin Moriarty, president and chief executive of Methodist Healthcare, told the committee that Hamilton’s reports provide compelling arguments to expand Medicaid coverage from a humanitarian, financial and budgetary perspective.

“Taxpayers get our dollars back. It seems to me fairly ludicrous to allow these funds to go to other states,” Moriarty said. “Taxpayers locally pay more because we don’t do this.”

Moriarty also emphasized multiple studies that show 5,000 to 9,000 people die each year because they lack access to health insurance.

John Davidson, health care policy analyst for the conservative Texas Public Policy Foundation, testified that the state should not expand Medicaid, but rather, seek a private market solution to expanding health coverage.

“We believe its reckless and unconscionable to expand a program that’s so obviously flawed,” said Davidson, emphasizing that low reimbursement rates and bureaucratic red tape have created a fragile network of Medicaid providers, and that multiple studies show Medicaid recipients have had worse health outcomes than those with private health plans.

If Texas does not expand Medicaid, Davidson said, a third to half of the potentially eligible population could qualify for a subsidy to purchase a private plan through the health insurance exchange.

The committee temporarily recessed so that House members could meet in the chamber. When they return later Tuesday afternoon, they are expected to consider House Bill 3791, authored by Rep. John Zerwas, R-Simonton, which would require the state’s health commissioner to craft a “Texas solution” to Medicaid by pursuing a Medicaid waiver or authorization from the federal government to reform Medicaid while expanding coverage to poor adults.

During budget negotiations, the Senate approved a rider by Sen. Tommy Williams, R-The Woodlands, which would also encourage the state to prioritize premium assistance for private market plans and contain state spending on the program. The House approved a similar measure during its budget negotiations, then backpedaled on that decision and removed the amendment on a party-line vote. 
 

This article originally appeared in The Texas Tribune at http://www.texastribune.org/2013/04/16/house-panel-considers-medicaid-expansion-proposal/.

Kevin C. Moriarty, For the Express-News

Gov. Rick Perry has made it clear where he stands on expanding the state’s Medicaid program to include low-income adults. READ MORE

Published by the San Antonio Express News: While Gov. Rick Perry on Monday surrounded himself with the state’s premier Republican leadership to excoriate Medicaid expansion, Democrats responded with their own political stars: the Castro brothers of San Antonio, who urged the governor to find a compromise to provide health care for more than a million low-income Texans. READ MORE

Published by Health Affairs GrantWatch Blog: On March 8, while a Texas House committee held our state’s first Medicaid expansion hearing, the Center for Public Policy Priorities hosted a legislative briefing with invited presentations by researchers from Rice University and George Washington University. They have studied the impact that the Affordable Care Act would have on the uninsured population in Texas, as well as the effects the new health care law will have on primary care access across our state. READ MORE

Published by The Houston Chronicle at Chron.com: Expanding Medicaid could make available $900 million in state general revenue funds that otherwise would be slated for health care as lawmakers work to pay for state priorities, according to a report released Tuesday. READ MORE

by Becca Aaronson

As state legislators consider what “a Texas solution” to Medicaid expansion would look like, others have begun addressing the question of how Medicaid expansion would affect the state budget and local taxes.

With extra federal money coming in, Medicaid expansion could offset $1.2 billion in the 2014-15 biennium budget that Texas would spend on other health programs to cover poor populations, according to a report released Tuesday by Billy Hamilton, the state’s former budget estimator and former deputy comptroller. The report was commissioned by Texas Impact and the Methodist Healthcare Ministries of South Texas.

“The issue needs to be examined closely by the affected agencies,” Hamilton said in a written statement. “The estimates are conservative but preliminary until we receive feedback from the agencies that that have access to much more detailed internal data and information concerning their programs and strategies.” 

This chart looks at how Medicaid expansion could impact spending on certain state programs, based on Hamilton’s report. The third column shows requested general revenue funds for the 2014-15 biennium, and the last column shows the amount that would be freed up by Medicaid expansion. 

AgencyProgramRequested GR Funds Only (FY 2014-15)GR Available Due to Medicaid Expansion (FY 2014-15)

 
Total
$3,446,483,003
$1,203,841,678

HHSC
Medicaid Pregnant Women
$871,792,147
$259,428,748

HHSC
Medicaid Health Services-Other Adults-TANF Level
$497,527,508
$303,625,617

HHSC
Women’s Health Services
$60,145,250
$28,679,175

HHSC
Undocumented Aliens & Legal Permanent Residents
$312,893,444
$28,121,533

HHSC
Breast and Cervical Cancer Program
$39,495,524
$13,646,568

HHSC
Non-Full Benefit Payments-Other
$68,657,493
$30,344,291

HHSC
Medical Transportation-Full Risk Broker Model
$60,966,753
$1,794,602

HHSC
Medical Transportation-Fee for Service
$122,165,357
$3,596,641

DSHS
Immunize Children & Adults in Texas
$58,603,692
$11,695,545

DSHS
HIV/STD Medications
$64,792,088
$28,638,761

DSHS
HIV/STD Services
$32,417,582
$12,896,011

DSHS
Kidney Health Care
$50,877,031
$13,232,277

DSHS
Community Primary Care Services
$26,897,446
$13,585,177

DSHS
Mental Health Services for Adults-Outpatient Services
$388,838,766
$95,807,889

DSHS
Mental Health Services for Adults-Inpatient Services
$9,584,492
$2,623,967

DSHS
NorthSTAR Behavioral Health Waiver Medicaid PMPM
$11,206,918
$2,249,380

DSHS
NorthSTAR Behavioral Health Waiver Indigent PMPM
$53,330,198
$33,395,719

DSHS
Substance Abuse Treatment
$25,086,000
$9,429,500

DSHS
Indigent Health Care Reimbursement (UTMB)
$11,500,000
$5,507,001

DSHS
County Indigent Health Care Services
$1,162,602
$1,162,602

DSHS
Texas Center for Infectious Diseases (TCID)
$20,247,936
$16,029,616

DSHS
South Texas Health Care System
$6,321,329
$3,660,544

DSHS
Mental Health State Hospital Off-Campus Medical Care
$19,513,552
$5,557,403

DSHS
Mental Health Community Hospitals Inpatient Services
$139,006,192
$48,312,993

TDCJ
Treatment Alternatives to Incarceration
$20,871,696
$16,084,078

TDCJ
Special Needs Programs and Services
$37,859,890
$28,046,469

TDCJ
Inpatient and Clinical Care for Incarcerated Adults
$314,622,083
$154,689,191

TDCJ
Substance Abuse Felony Punishment Facilities
$114,766,718
$28,974,943

UTMB
UTMB Indigent Care
$5,333,316
$3,025,439

The dominant fiscal argument for proponents of Medicaid expansion is that the program would reduce billions in uncompensated care costs shouldered by local government entities and public hospital districts. Spending on uncompensated care, the proponents say, raises private insurance premiums and local tax rates.

In response to those assertions, Sen. Charles Schwertner, R-Georgetown, has filed legislation, Senate Joint Resolution 61 and Senate Bill 1808, calling for a constitutional amendment to reduce local tax rates if Texas reaches an agreement to expand Medicaid and the program realizes cost savings.

“Ultimately, we’re talking about our own federal tax dollars, taxes we already pay, that would be used to alleviate these expenses,” Schwertner said in a statement. “If this is really about reducing costs and saving people money, then it makes absolutely no sense for Texans to be taxed twice for the same services. This legislation would protect Texans from double taxation.”

Hamilton estimates the Medicaid expansion would cost Texas $15 billion over 10 years, while allowing Texas to draw down $100 billion in federal financing. These Texas Tribune interactives show the economic impact of the Medicaid expansion by legislative district, and the effects on uncompensated care and the rate of uninsured by county, according to Hamilton’s estimates.

John Davidson, a health policy analyst at the conservative Texas Public Policy Foundation, said Friday at a legislative hearing that other states that extended Medicaid to adult populations did not see a reduction in uncompensated care costs.

“Property owners should not expect taxes from county hospital districts to go away if the state expands Medicaid,” Davidson said in an email, adding that the Affordable Care Act cuts billions in Medicaid and Medicare financing to hospitals to pay for provisions in the law and therefore, hospitals may continue to seek additional public financing for uncompensated care.

Although state Republican legislators have overwhelmingly rejected Medicaid expansion “in its current form” under the Affordable Care Act, they’ve begun negotiations on what Medicaid expansion would look like in Texas.

Rep. John Zerwas, R-Simonton, filed House Bill 3791 to grant the Health and Human Services Commission the authority to reach an agreement with the federal government to expand Medicaid, if certain parameters determined by the Legislature are met. Currently, the bill requires the agreement with the federal government to include cost-sharing measures, such as copayments, and allow Texas flexibility to tailor benefits offered by the Medicaid program. It also includes a severability clause to end the expansion program if the federal government reduces it share of financing.

The federal government would pay 100 percent of Medicaid expansion enrollees’ health care costs from 2014-16, and then, would pay a smaller percentage each year until the federal share reached 90 percent in 2020. Texas can opt in or out of Medicaid expansion at any point, but the 100 percent federal financing match is only available in 2014-16. Texas would also be required to pay half of the administrative costs, which the Legislative Budget Board estimates would cost the state $50 million in 2014. 

This article originally appeared in The Texas Tribune at http://www.texastribune.org/2013/03/12/medicaid-expansion-offset-state-spending-and-local/.

Published by the KZTV10.COM: Texas Republicans have made it clear they hate the idea of expanding health care for the poor under the Affordable Care Act, but a key leader pledged Friday to work on a state alternative to accomplish the same goal and bring in the same federal matching funds. READ MORE

San Antonio, Texas — Billy Hamilton, the former deputy comptroller for Texas and the author of the Methodist Healthcare Ministries’ (MHM) commissioned report, “Expanding Medicaid in Texas: Smart, Affordable and Fair,” is expected to testify before the Texas House Appropriations Committee in Austin on Friday, March 8, 2013 regarding the potential expansion to the state’s Medicaid program.

Hamilton’s testimony comes on the heels of House Speaker Joe Straus’ (R-San Antonio) plea to fellow Republican lawmakers to come together in order to propose a solution that would be supported by our state leadership.

According to Hamilton, under a moderate enrollment scenario, Texas could experience a $1.8 billion increase in taxes from new federal Medicaid funds from fiscal years 2014 to 2017. Proponents of expanding the state Medicaid program have hailed the economic analysis within the report as the singular and most compelling argument for why Texas should follow suit with the expansion.

Dr. Michael Cline and Dr. Steve Murdock, authors of the MHM-commissioned report, “Estimates of the Impact of the Affordable Care Act on Counties in Texas” will also be present at the hearing to offer lawmakers their perspective on how Texas counties will be impacted by implementation of the Affordable Care Act, which gives states the option of expanding their state Medicaid program.

The hearing will take place just as advocates plan to gather at the Capitol for a legislative briefing hosted by the Center for Public Policy Priorities. Attendees at the briefing will have an opportunity to hear from Dr. Cline and Dr. Murdock as they present findings from their report, as well as Dr. Leighton Ku of George Washington University as he presents findings from the MHM-commissioned report, “The Potential Primary Care Crisis in Texas: A County Based Analysis.”

Each study highlights the impact of implementing the Affordable Care Act at different enrollment scenarios on a county-by-county level, and even addresses the workforce issues that will no doubt become part and parcel of the debate as lawmakers grapple with expanding the state Medicaid program.

For more information about the legislative briefing hosted by the Center for Public Policy Priorities, contact Brian Stephens at stephens@cppp.org. To download the reports by Dr. Cline and Dr. Murdock, Mr. Hamilton, and Dr. Ku visit mhmbridgeofblessings.org.

by Bee Moorhead & Kevin C. Moriarty

A rebuttal from the groups that commissioned the Hamilton report on Medicaid expansion; they say the concerns about expansion, elucidated in a recent critique of the report by Sen. Bob Deuell, are unfounded

As representatives of the faith community, we believe that health care is a core value – but we also believe in weighing the facts and making smart policy decisions, so we commissioned a report by universally respected state budget expert Billy Hamilton to find out what the fiscal and economic impacts of Medicaid expansion would be in Texas. Since our report was released, legislators and others have raised important concerns about expanding Medicaid. We believe lawmakers deserve to have their questions and concerns addressed thoroughly as they debate one of the most important legislative decisions Texas has made in decades.

Many of the most common concerns about Medicaid expansion are unfounded.

Fears about the possibility of people shifting from private insurance to Medicaid causing negative effects to the insurance industry, creating a new class of uninsured and causing premiums to increase are unfounded. Dr. Michael Cline and Dr. Steve Murdock with the Hobby Center for the Study of Texas at Rice University have estimated that approximately 1.5 million uninsured individuals will sign up for the ACA subsidized insurance under a moderate enrollment scenario. The Health and Human Services Commission estimates about 10 percent of privately enrolled individuals will shift to Medicaid, although some states have experienced less. In Texas, that would be about 87,000, which the 1.5 million would totally overwhelm. The net effect of the ACA, then, will be a huge boost to the insurance industry. This issue was debated and put to rest during the original debates on passing the ACA. Our report provides a range of enrollment scenarios as well as the data for people to develop their own assumptions about shifting.

Worries that accepting the federal funds will somehow increase the federal deficit or debt are also unfounded. The federal government is not borrowing money to pay for the Medicaid extension to low-income adults or the ACA’s subsidized insurance. The ACA has built-in revenue streams and offsets that will more than pay for expanded Medicaid and subsidized insurance. In fact, it will generate more revenue than it spends; the Congressional Budget Office, the nonpartisan arm of Congress that estimates the fiscal impact of legislation similar to our Texas Legislative Budget Board, estimates that the ACA, including the Medicaid expansion, will shave more than $200 billion off the federal deficits over the next ten years.

To manage anxiety that the federal government will renege on its promise to fund 90 percent of the cost for low-income adults beyond 2020, Texas could include an automatic trigger, such as Arizona is doing. Texas could discontinue the program if Congress reneges on its promise.
Another concern is that the Medicaid system in Texas cannot handle an influx of new patients since only about 59 percent of physicians accept Medicaid patients, according to Community Health Choice (CHC), a managed care organization, that compared Medicaid payments from the Health and Human Services Master File to active physicians licensed by the Texas Medical Board. The ACA, however, recognized this national problem and fully funded a rate increase for primary care services up to the Medicare rate for 2013 and 2014. Extending the rate increase is optional for states, which would continue to receive federal matching funds to help pay for it.

In Texas, the Medicaid reimbursement rate was only 61 percent of the Medicare rate in 2012, according to the Kaiser Family Foundation, close to the national average of 59 percent. Nationally, the average cost of a 30-minute office visit for a new primary care patient was $63.46. In Texas, an increase to the Medicare rate would bring that fee up to $104.03—a substantial improvement.

A recent study conducted by Sandra Decker, an economist with the Centers for Disease Control, and published in Health Affairs, found that 83 percent of physicians nationally accepted Medicare compared to only about 69 percent that accepted Medicaid. She also found that the percent of physicians accepting new Medicaid patients correlated with the amount the state paid Medicaid doctors as a percent of the Medicare rate. Consequently, the rate increase that began in January in Texas should create a substantial increase in the number of physicians accepting new Medicaid patients.

Finally, Texas and other states have been looking for “flexibility” in the Medicaid program, including co-payments and a strong focus on managed care. Recently, the administration released its Final Rule for copayments and increased rates that states may charge for provider visits, including giving states’ the flexibility to charge higher rates to those above the poverty level who use hospitals for non-emergency care. Texas has long been a leader in implementation of Medicaid managed care, which is now available statewide. With the streamlining of eligibility systems that the ACA enacted and the new flexibility in co-payments now afforded the states, Texas no longer has a pressing need for a Medicaid block grant.
On the other hand, there are some very real dangers regarding Medicaid expansion that legislators should attend to promptly.

First, over the next ten years, Texans will be paying into a $100 billion kitty collected by the ACA’s new revenue streams and offsets to extend Medicaid to low-income Texans. If Texas opts out of the extension, then Texans will be effectively donating that $100 billion to the federal government!

If Texas delays the extension a biennium, presumably for time to “fix” Medicaid, then Texans will permanently lose $7.7 billion in federal funds. Texas has a long history of continuing to serve more than 3 million children and adults in its Medicaid program while implementing major reforms and structural changes. There is no reason why the state cannot implement improvements while serving this new population.
At the same time that Texans are paying in to the $100 billion kitty, Texans will continue to pay out the same high state and local costs for this group, who currently seek help in local hospital emergency rooms and community health clinics. The total annual amount of unreimbursed health care costs for local government alone in Texas amounted to about $2.5 billion in 2011 and hospitals shouldered another conservative estimate of $1.8 billion. This estimate includes only uninsured individuals and excludes any unreimbursed costs of Medicaid or other government-sponsored programs.

Although the ACA will relieve some of this burden, since people from 100 percent to 400 percent of the poverty level will be able to obtain subsidized insurance through the insurance exchange, much of it will remain unless the state extends Medicaid to adults below 138 percent of the poverty level.

We estimate that Texans will also need to find an additional $889 million for this next biennium alone to fund the additional children who are currently eligible for Medicaid but not enrolled and who will sign up through the streamlined enrollment process provided through the new federal health insurance exchange. For the 2016-2017 biennium, the total will increase to $1.6 billion.

And, if Texas wants to solve its Medicaid physician shortage, it will need to find yet an additional $161 million for the 2014-2015 biennium to extend the basic primary care services rate increase that the ACA funded for 2013 and 2014, according to HHSC’s July 2012 estimates, and an additional $92 million to extend it to all physicians providing primary care services. Although the extension of the primary care rate increase beyond 2014 is technically optional, the state will need to find the money anyway to ensure enough available physicians to treat the new children materializing in 2014.

Without the new state and local revenue that extending Medicaid would bring, however, Texas will be hard-pressed to find these additional revenues. If Texas opts in, however, then an estimated $500 million in state revenue will flow in for the next biennium and about $1 billion in the following biennium due to the influx of federal funds for the adults. In addition, it will add an estimated $700 million in the next biennium to state revenue and $1.4 billion to local coffers. Since the federal funds will pay 100 percent of the services to adults for the next three years and no less than 90 percent in 2020 and beyond, general revenue that Texas now spends on this population at the state and level would become available. And, local hospitals will no longer have to shoulder the burden of uncompensated costs for this population. In effect, we would be shifting this population from the “Locally Funded Emergency Room Treatment” program to managed care through Medicaid, a far more efficient option.

But most importantly, if Texas opts out, people below the poverty level will have no insurance. Since the ACA assumed that Medicaid would cover them, it does not provide an option for insurance subsidies for this group. If Texas opts in, however, people that do not currently have adequate health care and rely on expensive emergency rooms for sporadic care will have a primary care physician, preventive care and referrals to specialists when necessary—just like people with private insurance enjoy.

As other states, such as Arizona, New Mexico, Ohio and Florida have come to realize, this decision is a no-brainer. Politics need to be set aside, and Texans need to come together to do what is best for Texas: extend Medicaid to low-income adults.

Bee Moorhead is Executive Director of Texas Impact and Kevin C. Moriarty, President & CEO, Methodist Healthcare Ministries of South Texas, Inc.

Copyright March 05, 2013, Harvey Kronberg, www.quorumreport.com, All rights are reserved

Published by the Mason County News: What a joyful and spirit filled day we experienced at the San Angelo District Leadership Training and Celebration January 12. We made a change to make the sessions convenient to laity by offering each session twice, back to back, and the change worked well. READ MORE

Published by the San Antonio Express News: A proposed Medicaid expansion plan would increase the number of Texans receiving health care, but Perry and others say the system is too broken to fix with more money. READ MORE

Published by the Dallas/Fort Worth Healthcare Daily: Another report has calculated the potential financial cost of Texas foregoing Medicaid expansion. According to the study, prepared by former Texas deputy comptroller Billy Hamilton, the expansion would create about 231,000 jobs by 2016 and ease the financial burden borne by counties, cities and local hospital districts. The study said Medicaid expansion would cut the state’s uninsured rate by 25 percent and provide insurance for up to 2 million people. READ MORE