By Ted Shaw, President/CEO, Texas Hospital Association
About a week before U.S. Census data revealed that Texas would gain two additional congressional seats—the most of any state in the nation—we learned that our state’s ability to provide health care services would dramatically shrink. Last month, the federal health agency over Medicaid and Medicare abruptly announced that it had rescinded Texas’ historic 10-year Medicaid 1115 Waiver extension, worth $100 billion through Sept. 30, 2030. Access to quality hospital care, community-based behavioral health care as well as public health and preventive services for millions of Texans now is in jeopardy. The loss of the waiver extension will be a catastrophic blow to Texas’ health care safety net, and remedying the situation is no simple feat.
The rescission was an ill-fated attempt to leverage Texas’ 1115 waiver to force our long holdout state to expand Medicaid. While hospitals fully support coverage expansion, we are disappointed that a decision of this magnitude could be so poorly miscalculated that the state of health care in Texas actually could worsen.
Days after the waiver rescission was announced, Houston-area state Rep. Garnet Coleman offered a proposal on the House floor to give the state flexibility to increase the number of Texans with comprehensive health care coverage. This effort to expand Medicaid failed on a near party line vote. What was a smart health care policy with strong bipartisan support and economic incentives evolved into a vote of confidence for or against the federal government.
Texas could have had both—1.2 million fewer uninsured Texans and a waiver that provided a strong uncompensated care pool to help offset unreimbursed costs providers incur for treating the remaining 3.8 million uninsured individuals who would not qualify for Medicaid. Texas needs both to expand coverage and maintain funding to help care for those who still would not qualify for Medicaid. In a state as large and demographically diverse as Texas, a one-size-fits-all approach simply cannot meet the unique health care needs of every person in Texas. That is why earlier this year hospitals launched a comprehensive grassroots and digital advocacy campaign to support coverage expansion at the Texas Capitol. With the 10-year waiver extension approved in January, the addition of coverage expansion only could improve access to care in Texas. Having supported coverage expansion since the inception of the Affordable Care Act, hospitals were enthused to learn of this session’s budget neutral proposal to draw down billions in federal funding to cover a million more Texans.
While hospitals continue to advocate to shrink the state’s coverage gap, we also are working closely with state leadership, the state health agency and the Texas Congressional delegation to mend the gaping hole that the waiver extension rescission has left in our health care safety net.
The current waiver’s uncompensated care pool remains intact for another year. But gone is the $5 billion, provided under the extension, that would have established a new UC pool for community mental health centers and local public health departments—providers that help reduce the need for hospitalization and support a healthier population. This funding is critical to our communities, as pandemic-induced rates of anxiety and depression have increased among adults and kids, and the need for local health screenings and vaccinations could not be greater.
The state will move forward with its plans to increase reimbursement for physicians and professional services, rural hospitals, ambulance providers, nursing homes, behavioral health providers and hospitals. But the funding to support those boosts will only last for a year. Then the state will face a “fiscal cliff” in which it no longer has the authority or dollars to spend on those programs. To move forward with the programs and funding in the 1115 wavier, a new waiver will have to be negotiated between the state and federal government. Without a successful extension that captures the same terms of the waiver that was rescinded, providers would need to wind down and transition those health care delivery models and community mental health centers and local public health departments would not have the opportunity to stand up new programs.
The budget uncertainty caused by the waiver extension rescission not only threatens access to care but it hinders providers’ ability to plan appropriately. If unresolved, this financial unpredictability could seriously impact the delivery of health care to Texas’ growing population. Texas needs solutions as big as its health care problem.