Gaps in Implementation of Federal Health Reform Leave More than 1 Million Texans Uninsured
Legislative Affairs Feature — January 2015
Tex Med. 2015;111(1):43-48.
By Amy Lynn Sorrel
One of few family physicians in the small, rural town of Athens, Douglas Curran, MD, ends up taking care of many uninsured patients through the local hospital's emergency department (ED). When one of those patients recently came in with congestive heart failure, Dr. Curran recognized her as a cook from one of his favorite local restaurants.
After treating her and chatting about follow-up, Dr. Curran learned she couldn't afford the health insurance to cover the additional care because it would consume most of her monthly income. But she didn't make enough to receive financial aid in the federal insurance exchange, and she made too much money to receive Medicaid.
Texas is one of about 20 states that chose not to expand Medicaid eligibility in 2014 as provided under the Affordable Care Act, leaving more than 1 million uninsured Texans — like Dr. Curran's patient — in the coverage gap. Medicaid covers only people with disabilities, low-income pregnant women, and children of low-income parents or parents with disabilities.
To keep his patient healthy, at least temporarily, Dr. Curran prescribed her three months' worth of medications, which she could buy affordably at Walmart.
"But I can't fill those long term without seeing her. She can't afford to pay me and come to my office to see me. And if I don't charge her, I can't pay my employees, and I can't turn my lights on. So here's our dilemma," he said. "I didn't see her back until she showed up in the ED again, and that's a tragedy."
Now that several states have succeeded in finding alternative solutions to cover the working poor without expanding Medicaid, however, Dr. Curran and some lawmakers are optimistic Texas, too, can develop its own unique plan to draw down the roughly $100 billion in federal funding available over 10 years.
None of that can happen, however, without enough physicians to take care of the many patients who stand to gain coverage, he adds. That means ridding the numerous administrative ailments within the program that keep doctors from participating in Medicaid — something the Texas Health and Human Services Commission (HHSC) has made progress on since the 2013 legislative session, and something TMA wants to see continue.
"We should be taking that money — our tax money — and using the innovation that is God-given in Texas to figure out a really good way to take care of our hardworking poor and to design a plan that doesn't look like the current Medicaid program, which is pretty dysfunctional," said Dr. Curran, a TMA Board of Trustees member. "We don't have to reinvent the wheel, but what we want to accomplish is getting people care who don't have care. That's what this is all about. That's what the money is for."
Making the Case
Starting in 2014, ACA allowed for expansion of Medicaid coverage to poor adults with incomes up to 138 percent of the federal poverty level ($16,104 for an individual, $32,913 for a family of four in 2014). The U.S. Supreme Court made that pathway optional, however, and Texas' Republican leaders have since refused, fearing the state would have to spend too much of its own money — about $15 billion — on an already flawed program.
Since then, a few states have successfully negotiated with the Centers for Medicare & Medicaid Services (CMS) to craft their own plans to cover the working poor without expanding Medicaid, using federal dollars to get private coverage, for example. (See "States Closing the Gap Without Expanding Medicaid.")
Those steps have contributed to pressure on state lawmakers to find a way to do something similar.
TMA maintains its support for a Texas-specific plan that allows the state to take advantage of extra federal dollars to improve coverage and access and that includes significant reforms to eliminate the costly administrative hurdles.
The Texas Hospital Association and business groups released a plan last fall, and an August 2014 letter from leaders of the state's six most populous counties urged the Senate Health and Human Services Committee to "find a Texas way" to "fund and increase access to health care coverage for low-wage working Texans."
In mid-November, the Texas Institute of Health Care Quality and Efficiency (TIHCQE) unanimously recommended the legislature give HHSC "the authority to negotiate an agreement with CMS" allowing Texas to expand access to care using available federal funds, and "support a private health insurance program for low-wage, working Texans to reduce the number of uninsured and the financial strain on health care providers and local taxpayers."
The proposals were among dozens the institute made as part of its charge to help reform health care delivery overall in the state.
TIHCQE board member Susan Strate, MD, clarified the institute's recommendations are not about expanding the current Medicaid program, which she, too, called dysfunctional. Rather, they were meant "to encourage lawmakers to look at options that are workable for the state of Texas" to expand access to care overall and in particular to those who fall in the coverage gap, Dr. Strate, the vice speaker of the TMA House of Delegates, said. "So the next question is, how do you pay for it?"
One way to do that, she says, is to draw down the extra federal funds. Another way "is if we really sink our teeth into reducing the substantial overregulation and administrative waste in the system, we would find a lot of dollars right here in the state."
Texas economists like Ray Perryman and former state Deputy Comptroller Billy Hamilton also continue to make an economic case for accepting new federal funds that could create a healthier workforce, stimulate the economy, and improve hospitals' financial health.
John Holcomb, MD, says adopting a state plan has medical and fiscal benefits. The San Antonio pulmonologist leads TMA's Select Committee on Medicaid, CHIP, and the Uninsured.
He pointed to studies showing adults with insurance, even public insurance, fare better in terms of health care outcomes than those without. And those most likely to fall in the gap and benefit from improved coverage are low-income, working adults, many of whom have long-term chronic illnesses, and many of whom are women.
Dr. Holcomb has several patients who fit the profile. One of them is an uninsured 27-year-old woman he admitted to the hospital three times in eight months due to complications from diabetes.
The $100 billion in exchange for a $15 billion state investment could go a long way "to help counties like Bexar County that have a large uninsured population and end up paying more in county taxes" to support the hospitals that bear the cost, he said.
Finding a Texas Way
Some state lawmakers are willing to reopen the conversation from last session that ended in the defeat of a proposal filed by Rep. John Zerwas, MD (R-Richmond). Others remain reluctant.
Rep. Garnet Coleman (D-Houston), an early proponent of expansion, says "it is a priority for Texas and the members of the legislature to make sure people in the coverage gap get care. The question now is how to get them care, and we need to continue to have that conversation. What's stopping us, quite frankly, is politics."
Representative Zerwas agrees, noting other states are testing options in line with his 2013 bill. House Bill 3791 proposed using federal dollars to reform Medicaid and create a private coverage option tailored to low-income Texans with some cost-sharing requirements, such as copays and sliding-scale subsidies.
Representative Zerwas reiterated his position against Medicaid expansion "if it's just more of the same."
But the member of the House Appropriations Committee also said, "This is a big enough issue that it does demand some consideration by the legislature. We do need to look intently at this population, who they are, what their needs are, and what are the opportunities to bring some kind of insurance product to them in a reasonable, cost-effective way. It doesn't mean if we don't do something, we have to end up with expansion. But we should look at this pretty hard. At the end of the day, this is a burden that a lot of metro areas are having to bear."
Any such effort is likely to face an uphill battle with new state leaders Gov. Greg Abbott and Lt. Gov. Dan Patrick, who are just as opposed as previous state leadership under former Gov. Rick Perry.
Texas' new chief Senate budget writer, Sen. Jane Nelson (R-Flower Mound), says, "Texans have been crystal clear in how they feel about the Affordable Care Act, and in my opinion, our energy should be focused on alternate ways to expand access to care."
For example, Texas likely will ask CMS to reauthorize the state's 1115 Medicaid waiver, which experiments with new ways to reform health care delivery for Medicaid and low-income patients. (See "Money Over Matter?" December 2014 Texas Medicine, pages 49-52.)
"Many of the programs funded by that waiver are excellent models for how we can increase access to care," Senator Nelson said.
Ben Raimer, MD, adds the waiver is just one in a series of "bold actions" Texas has yet to see through in terms of expanding access to care. He is senior vice president for health policy and legislative affairs at The University of Texas Medical Branch in Galveston and chairs the HHSC Council, which helps develop commission policies and rules and makes recommendations regarding management and operation.
"People forget we already have an expansion under way … and the [$29 billion] put into the program was the first step," Dr. Raimer said. Despite its Medicaid waiver label, he notes the program has spillover effects into the state's low-income and uninsured populations, for example, with expanded programs to address mental health, disease prevention, and health literacy.
Following the Sunset Advisory Commission review process, HHSC will undergo a major retooling Dr. Raimer calls "a perfect opportunity to reinvent the Texas Medicaid program."
Still, speaking on his own behalf, Dr. Raimer said, "We have to acknowledge that we still have gaps, and we haven't covered those gaps. And we need those [extra federal] dollars in Texas" to close them. "At the end of the day, we need a healthy population and a healthy workforce, and the only way to get it is to be sure everyone gets access to health care."
None of the 1,500 waiver projects under way in Texas, however, addresses such a coverage option, Dr. Holcomb notes, whereas other Republican-led states — Arkansas, Iowa, Michigan, and Pennsylvania — used 1115 waivers to do just that.
"None of these [projects] were designed to improve the insurance environment in Texas. What we need is a secure system where patients have the ability to see a doctor, and the doctor or the hospital receives payment based on a contracted amount for the services they provide," he said.
The Fix-It List
As for other changes, physicians are seeing progress on their Medicaid fix-it list.
The 2013 legislature, under Senate Bill 7 by Senator Nelson, set up a State Medicaid Managed Care Advisory Committee at HHSC to make recommendations on how to improve implementation of Medicaid managed care overall. A separate committee set up under Senate Bill 1150 by Sen. Juan "Chuy" Hinojosa (D-McAllen) calls on HHSC to develop a plan specifically to reduce administrative burdens.
TIHCQE also recommended any state plan to expand access to care include "substantially reducing administrative burdens and regulations on payers and providers" across public and private programs.
Austin pediatrician John Hellerstedt, MD, cochairs the statewide Medicaid advisory committee. He is chief medical officer at Seton Family of Hospitals.
"All of us on the committee know that Texas Medicaid cannot hope to fulfill its mission without the skill and dedication of its providers. But when you create a system that just makes you lose money or not get paid at all every time you see a Medicaid patient, that's not a system that achieves anybody's aims," he said.
The committee recommends:
- Creating a single, centralized credentialing process;
- Setting up a medication reconciliation program with the help of HMOs;
- Requiring patients to stay with the same HMO for a year before switching to promote continuity of care (may require federal approval); and
- Revising network adequacy standards.
Network adequacy was a hot topic, Dr. Hellerstedt says, especially after lawmakers last session expanded Medicaid managed care to additional populations, such as those with intellectual and developmental disabilities. Medicaid HMOs, also represented on the committee, are for the most part on board with the recommendations, he adds.
Suggested improvements specific to network adequacy would require HHSC to adopt broader standards, improve oversight, and track real-time capacity, for example.
Some of the changes may require legislative approval; HHSC may implement others on its own through regulation. At press time, HHSC Executive Commissioner Kyle Janek, MD, planned to consider the recommendations for inclusion in a report to the legislature. TIHCQE staff also were preparing to report the board's recommendations to the legislature.
States Closing the Coverage Gap Without Expanding Medicaid*
Arkansas (in effect since Sept. 27, 2013)
Uses Medicaid funds to purchase private insurance coverage in the federal exchange for newly eligible adults aged 19 to 64. Applies to parents with incomes 17 percent to 138 percent of the federal poverty level (FPL), and childless adults with incomes 0 percent to 138 percent of FPL.
Iowa (in effect since Jan. 1, 2014)
Newly eligible adults with incomes below 100 percent of FPL can receive coverage through the Iowa Health and Wellness Plan. Individuals with incomes 100 percent to 133 percent of FPL can receive premium assistance to purchase private insurance from the federal exchange.
Michigan (in effect since April 1, 2014)
Covers newly eligible adults through Michigan's existing Medicaid managed care program, not through premium assistance. Will use existing Medicaid HMOs and prepaid inpatient health plans to serve the newly eligible population.
Pennsylvania (proposed effective date Jan. 1)
Uses Medicaid funds to purchase private insurance through the federal exchange for newly eligible adults aged 21 to 64, parents with incomes 33 percent to 138 percent of FPL, and childless adults with incomes 0 percent to 138 percent of FPL.
Indiana (pending approval)
Expands the existing Healthy Indiana Plan, which combines health savings accounts with private, high-deductible plans and applies to residents making too much money to qualify for Medicaid. Will expand to adults aged 19 to 64 earning up to 138 percent of FPL.
*Requires approval from the Centers for Medicare and Medicaid Services
Source: Kaiser Family Foundation, as of Aug. 28, 2014