Maintain Medicaid Eligibility for Pregnant Women

Testimony by Louis Appel, MD

House Appropriations Subcommittee Art. II
On Health and Human Services Commission
February 23, 2017

Submitted on behalf of:  

  • Texas Medical Association
  • Texas Pediatric Society
  • Texas Academy of Family Physicians
  • Federation of Texas Psychiatry
  • American Congress of Obstetricians and Gynecologists – District XI (Texas)
  • Texas Association of Obstetricians and Gynecologists  

Good morning Chairwoman Davis and committee members. I am Louis Appel, MD, an Austin pediatrician testifying today on behalf of the Texas Medical Association, Texas Pediatric Society, and the specialty societies listed above to respectfully urge your support to protect vital Health and Human Services safety net programs, including Medicaid, the Children’s Health Insurance Program, and women’s health programs. 

We are highly cognizant that Texas’ current budget environment will mean the legislature must make painful budget decisions. But those decisions, as you well know, have real short- and long-term impacts on real people. Short-term cuts also may increase Texas’ costs later. With that in mind, it is important to remember that Medicaid and CHIP together serve more than 4 million Texans, people we all know or encounter every day, including hard working, low-income parents and their children as well as people with disabilities and seniors. Without the programs, the vast majority of Medicaid and CHIP patients would be uninsured, thereby depriving them of access to affordable preventive, primary and specialty care. 

Eighty percent of Medicaid enrollees are children, parents, and pregnant women; 52 percent of births are paid by Medicaid. As such, Texas Medicaid plays an outsized and vital role in our efforts to improve maternal and child health outcomes. Working with physicians and other stakeholders, Texas Medicaid has initiated innovative programs, such as the Healthy Texas Babies Initiative, and regional perinatal care to improve the lives of mothers and children. These investments have paid off. For example, over the past decade, Texas’ rate of premature babies has steadily declined, low-income women losing Medicaid face fewer barriers to preserving access to preventive care via Healthy Texas Women, and hospitals and physicians will soon implement evidence-informed neonatal levels of care ¾ followed soon thereafter by maternal standards of care ¾ which will promote the right level of care for babies at birth.

But while birth outcomes data show important improvements, distressingly, in 2016 two independent reports  found Texas’ rate of maternal mortality more than doubling over the past two years, with African-American women at the greatest risk of death. Indeed, black women account for 11.4 percent of births but 28.8 percent of maternal deaths. Multiple factors contribute to the higher maternal mortality/morbidity rates, with experts baffled by why Texas’ rates far exceed that of other states. But there are useful, evidence-informed steps Texas can take in the next biennium to improve the lives of mothers and babies. 

As you refine House Bill 1, foremost, we respectfully urge you to reject reductions in Medicaid eligibility for pregnant women, a potential cost-containment measure identified by the Health and Human Services Commission. Early and ongoing prenatal care is vital not only to ensure pregnant women receive important preventive care, such as vaccines, but also to detect and manage behaviors and illnesses that may affect the health of the mother and baby, including smoking, high blood pressure, substance abuse, and diabetes, all of which contribute to poor birth outcomes.   Babies born prematurely cost roughly 18 times more than a full-term baby. Over the first year of life, HHSC estimates a premature baby will cost Texas Medicaid an average of $100,000, while a full term baby a tiny fraction of that:  $572. Further, cardiac disease and behavioral health issues are the highest contributors to maternal death and severe illnesses in Texas. 

Further, we commend your commitment to women’s preventive health services, which are critically important not only to improving the lives of women and their families but also to  reducing Medicaid costs. In the 2018-19 biennium, we urge you to: 

  • Support initiatives to improve postpartum (perinatal) depression screening. Postpartum depression is linked to poorer short- and long-term physical and behavioral health outcomes among mothers and children. By treating depression early, Texas can improve lives while lowering Medicaid and societal costs.
  • Invest in services to prevent maternal mortality or morbidity, including enhanced specialty care between pregnancies.
  • Fund an academic study at a Texas public health university to better understand the genetic, medical, and/or socioeconomic factors contributing to severe maternal illness or deaths.
  • Enact robust outreach efforts to increase uptake of long-acting reversible contraceptives, which are 20 times more effective than other forms of contraception, thus reducing unplanned pregnancies and abortions. 
  • Maintain funding for the Healthy Texas Women and Family Planning programs, which provide women preventive health services, including well-woman exams, contraceptives, cancer screenings, and treatment for illnesses such as hypertension and diabetes. 

While our organizations highly value Medicaid, a Medicaid card does not access make. Inadequate physician payment rates have forced many physician practices to limit their Medicaid and CHIP participation or cease it altogether. Medicaid payments are the least competitive among all insurers, ranging from 48 percent to 87 percent of Medicare and 41 percent to 73 percent of commercial insurance payments. These rates are hardly enticing, particularly when many practices can barely keep up with demand for their services from better-paying privately insured patients. 

According to TMA’s biennial physician survey, in 2000 67 percent of Texas physicians accepted all new Medicaid patients. Today, that number is 41 percent. The good news is that increasing physician Medicaid payments actually reverses the decline in participation. From 2012 to 2016, physician participation in Medicaid rose 4 points, a jump attributable to the temporary two-year primary care physician rate increase paid for with federal funds. Similarly, in 2008, physician participation increased after Texas lawmakers invested new monies to improve the physician Medicaid network.

Yet, as owners of small businesses, facing ever more costly and demanding federal and state regulatory burdens, many just cannot afford to stay in a program that pays less than half their costs. 

Like roads and bridges, physicians are integral aspects of Medicaid’s infrastructure. Without them, efforts to reduce costs by improving preventive care, improving management of chronic diseases, or reducing unnecessary emergency department care will fall short. Attracting more physicians to Medicaid will require Texas paying competitive Medicaid and CHIP payment rates for physicians, including an annual update to keep payments current with practice costs. While increasing all Medicaid and CHIP physician payment rates this budget cycle may prove unfeasible, as you write the 2017-18 budget, we urge you to consider: 

  • Targeted physician rate increases for services for which access is particularly troublesome, and 
  • Exempting Medicaid and CHIP physician payments from the 1.5 percent general revenue reduction.  

With limited funds, we know you will face difficult decisions in the days ahead. At the same time, Texas can learn from its history  ¾ reductions in services for pregnant women and children are particularly penny wise and pound foolish. 

  • In 2003, Texas reluctantly reduced Medicaid eligibility for pregnant women from 185 percent of federal poverty to 158 percent, resulting in higher Medicaid costs in the next biennium.  Due to concerns regarding the impact the cuts would have on maternal and neonatal costs, the eligibility cuts were subsequently restored in 2004. 
  • In 2011, Texas axed funding for women’s preventive health services only to see a spike in unplanned pregnancies, paid largely by Medicaid. As a result, Medicaid costs increased by an estimated $140 million the following biennium. Texas reversed the cut in 2013. 

We agree that Medicaid needs a facelift. We want to work with you to continue to identify commonsense changes that will benefit patients and the provider network while also improving patient outcomes and lowering costs. 

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Last Updated On

April 20, 2018

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