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Feds Grant Texas $25 Billion Extension of Medicaid Waiver

AUSTIN – Health care providers in Texas are getting a $25 billion shot in the arm with the five-year extension of a Medicaid program by the federal government.

The plan, known as an 1115 Demonstration Waiver is considered a low-cost alternative to traditional Medicaid.

It provides hospitals and other caregivers with incentives to improve care access and quality, and helps pay for uncompensated care.

Stacy Wilson, president of Children’s Hospital Association of Texas, says since Texas chose not to expand full Medicaid coverage under the Affordable Care Act, the waiver extends coverage to many low-income patients who might otherwise go without.

“We’re very excited about the opportunity to continue the waiver because, number one, we’ve seen a lot of improvement in outcomes and lowering the cost of care,” she states. “And number two, it helps shore up our safety net hospitals, like our children’s hospitals, who are so heavily reliant on Medicaid.”

The Obama administration originally approved the 1115 waiver for Texas in 2011, but it was set to expire Dec. 31.

Medicaid expansion under the ACA was meant to replace the waiver program, but some states, including Texas, declined to expand Medicaid.

The extension allows state officials to continue funding a number of health care programs without disruption.

While providers welcome the money from the waiver program, Wilson points out it isn’t a substitute for traditional Medicaid coverage.

“What we don’t get paid to cover our costs in Medicaid, we’ve become, unfortunately, reliant on these supplemental payment programs,” she states. “[We’d] Much rather be paid our costs upfront, but those are not the policy decisions some of our elected officials have made.”

Wilson says hospitals and clinics urgently need more funding to cover people who can’t afford to pay.

“One of the things that the state could do is pay us closer to our Medicaid costs,” she states. “That would help, especially children’s hospitals.

“Seventy percent of the Medicaid enrollees in Texas are children, so we are disproportionately reliant on the Medicaid program.”

The extension, which runs through 2022, apparently came just in time for Texas. Federal officials say they will not approve any more states’ requests to renew funding for waivers.
Author -Mark Richardson, Public News Service (TX)

Congress is Eyeing big Medicaid Cuts: Here’s Why it Matters to Texas Families

Despite years of sleepless nights, emergency room trips and long stares into the financial abyss, Kate Robinson-Howell and Bob Howell of Austin are adamant that they are a Medicaid success story.

Their second child, Apollo, was born with a malformed esophagus and trachea. He had emergency surgery to reconstruct his airway when he was just four months old. Now two years old, Apollo eats through a gastronomy tube that protrudes from his stomach, suffers from chronic lung disease and has endured dozens of emergency room visits and countless hours of speech, physical and feeding therapy.

“We’re just on edge constantly,” Robinson-Howell said. “If people don’t see it, it’s hard to appreciate how incredibly intensive and relentlessly demanding it is to raise a child with a chronic illness.”

To the average visitor, Apollo might look like any other toddler. He likes trains because his four-year-old brother Oliver likes trains. His voice is raspy, but he thanks visitors and calls them “sir.”

Robinson-Howell, who has worked in the health care policy field in the past, said the only reason the family finances have not been “ridiculously torpedoed” is that they qualify for Medicaid through a Texas program that covers kids with chronic conditions.

Medicaid helps families like the Howells afford their children’s health care. But the program, which was expanded under the Affordable Care Act, better known as Obamacare, could see major cuts if the U.S. Senate adopts the cost-saving provisions of the House-passed American Health Care Act. According to an analysis by the Congressional Budget Office, the House proposal would reduce future Medicaid spending by $834 billion over 10 years.

Supporters of the Medicaid reforms in the legislation say they will control runaway spending. Detractors say the plan uses Medicaid cuts — the bulk of which would go into effect in 2020 — to finance the repeal of Obamacare taxes that mostly fall on the wealthy.

“The budget being balanced on the back of disabled children is asinine and atrocious, and we should all be mortified that it’s even being talked about,” Robinson-Howell said.

Chris Jacobs, the founder and CEO of Juniper Research Group and a conservative health care policy expert, said Texas children with disabilities like Apollo would likely see little to no reduction in Medicaid help under the House proposal.

Jacobs pointed to a June report from the nonpartisan Centers for Medicare and Medicaid services that said more than 70 percent of Medicaid cuts will come in the form of a repeal of the Obamacare Medicaid expansion. Because Texas has not voted to expand the program, Medicaid cuts may not be as dramatic as in other states, he said.

U.S. Rep. Roger Williams, Robinson-Howell’s congressman, voted for the American Health Care Act, writing in a May 4 statement that it will “begin to undo the damage caused by Obamacare.” His office did not respond to requests for comment for this story.

Texas, which has one of the nation’s highest rates of uninsured children — 11 percent, according to a June study by the nonpartisan Georgetown University Center for Children and Families — is especially vulnerable to Medicaid cuts of any type. Almost half of all Texas children with insurance get it through Medicaid.

The study also noted that rural children in Texas have disproportionately benefited from health care reforms brought about by Obamacare. In 2009, the year before the landmark reform bill was signed into law, 18 percent of rural Texas children were uninsured. By 2015, that number had fallen to 11 percent.

Ronnequa Tennon of Elgin said Medicaid is keeping her daughter alive. Now 3 years old, her daughter was born prematurely. She weighed just one pound, one ounce at birth, and immediately required a ventilator to breathe. She still requires round-the-clock medical care and will likely be on life support for the rest of her life. Tennon, who is between jobs, said she could not afford her daughter’s expensive medications without Medicaid.

“I would be out of her life, and probably working up to 10 jobs just to keep her living,” Tennon said.

U.S. Reps. Michael McCaul and Bill Flores, Republicans who each represent parts of Elgin, both voted for the House health care plan.

After the May vote, McCaul said in a statement, “My vote for the AHCA is the first step towards building a stronger foundation for our nation’s healthcare system.”

Flores’s post-AHCA statement said: “The bill … enacts the largest entitlement reform in decades by modernizing and strengthening Medicaid.”

It’s unclear precisely how potential cuts would affect Texas children and families on Medicaid. But Stacy Wilson, president of the Children’s Hospital Association of Texas, says AHCA specifications ensure that there will be less Medicaid money to go around — particularly in the Lone Star State.

If the House proposal becomes law, Medicaid cuts would come in the form of a fundamental change in the payment structure of the program. Today, the federal government matches state Medicaid spending dollars. The House plan would mandate that a state’s allotment of federal Medicaid funds would be calculated on a per capita basis based on 2016 spending, capped and then adjusted for inflation yearly.

A May study published by the nonpartisan Brookings Institution looked at how a per capita cap would have affected Medicaid funding in the 2000s. It concluded that “no state would have received more funding under a per capita cap than under current law in any year.”

Jacobs said Texans would be fine under the House plan’s per capita cap.

“I think the impact would be limited to minimal if the per capita caps went into effect,” he said, adding the reform would “control costs by giving states more flexibility.”

According to a June University of Texas/Texas Tribune poll, just 20 percent of Texans who have been following the health care debate have either a “very favorable” or “somewhat favorable” view of the American Health Care Act, compared with 51 percent who say they have a “somewhat unfavorable” or “very unfavorable” view.

It is unknown how the Senate version of the legislation will handle Medicaid. The legislation, which U.S. Sen. John Cornyn, R-Texas, said he wants to see voted on before the August recess, will be unveiled Thursday, according to the Washington Post. There have been no hearings on the legislation, which Republicans have drafted out of the view of the public.

But in a Tuesday speech on the floor of the Senate, Cornyn said he wanted to make Medicaid “sustainable into the future.” He cited the Medicaid changes in the House plan as a way to keep program spending increasing “at a sustainable rate.”

Robinson-Howell said she has begged her representatives not to cut health insurance programs. In a Feb. 7 letter to Cornyn, she wrote, “Any cuts to ACA will put my two-year old son’s life at risk.”

She said Cornyn responded with a letter in June reassuring her that he would work to end wasteful foreign assistance spending.

A spokeswoman for Cornyn said Robinson-Howell “should have received a healthcare-related reply from Sen. Cornyn in March.”

Disclosure: The Childrens Hospital Association of Texas and the University of Texas have been financial supporters of The Texas Tribune. A complete list of Tribune donors and sponsors is available here.

Read related Tribune coverage:

  • U.S. Sen. John Cornyn predicted a new GOP health care overhaul would pass Congress by the end of July. [link]

Author:  KIRBY WILSON – The Texas Tribune

Kids’ Advocates Push to Restore Texas Medicaid Funds

AUSTIN – Budget cuts to the Texas Medicaid program have left many of the state’s poorest children with little or no access to necessary health care, according to children’s advocates. They say despite calls by some in the Texas Legislature to restore funding, the current Senate budget plan underfunds Medicaid by at least $1.9 billion and includes an across-the-board budget cut that threatens care for many recipients.

Cheasty Anderson, a senior policy associate with the Children’s Defense Fund-Texas, says the cuts are hitting families with special needs children the hardest.

“When you look at a Senate budget that underfunds the needs, and on top of that, implements a 1.5 percent cut to all Health and Human Services programs, it’s hard to see how that would improve conditions for families who rely on Medicaid,” she said.

A coalition of advocacy groups is planning “Cover Texas Now,” a rally and advocacy day at the capitol on March 6th. Anderson says in addition to restoring children’s health care funds, the group will also call for restoring Medicaid therapy cuts for children with disabilities, and protecting Texans from a repeal of the Affordable Care Act.

At a recent committee hearing on the budget, Kyla McKay of Pasadena testified that her child has life-threatening conditions and Medicaid is what keeps her alive.

“Katy is an active, intelligent child with her medical challenges,” she said. “Her future could be very bright, but if she loses access to her physicians and the medical equipment she relies on to survive, she might not have a future.”

Anderson says in its budget-cutting fervor, the legislature is leaving behind those who need health care benefits the most.

“The state legislature spends a lot of time talking about cutting costs and cutting the budget, but when they make those cuts, the need doesn’t disappear,” added Anderson. “What ends up happening is that they are shifting their responsibility to local entities, like county and city taxing authorities.”

Texas is one of 19 states that did not expand Medicaid under the Affordable Care Act and still has both the highest rate and number of uninsured people in the country.

Author:  Mark Richardson, Public News Service (TX)

Texas Supreme Court Allows Medicaid Cuts to Children’s Therapy to Proceed

A significant cut to the amount of money Texas pays therapists who treat children with disabilities was finally cleared to take effect — more than one year after state lawmakers originally ordered it — when the Texas Supreme Court on Friday declined to hear a lawsuit over the budget cut’s legality.

Last year, a group of concerned Texans filed a lawsuit seeking to block the $350 million cut to Medicaid, the federal-state insurance program for the poor and disabled, from taking effect. That group included speech, physical and occupational therapy providers and the families of children who receive their service. They argued that the cuts were so steep that providers would have to close their businesses and forgo seeing as many as 60,000 children.

The Texas Health and Human Services Commission and several health insurers with state contracts denied those allegations, arguing that therapy providers were overpaid by Texas Medicaid compared with private health insurance plans and that payment cuts would not reduce children’s access to services.

The Supreme Court’s announcement means that a lower court’s decision, which found the lawsuit lacked standing, will remain in place, clearing the way for state officials to begin cutting payments to in-home therapists by as much as 25 percent. The Supreme Court hadtemporarily blocked the cuts from taking effect while it considered whether it wanted to hear the case.

Rachel Hammon, executive director of the Texas Association of Home Care and Hospice, a provider lobby group, said she was disappointed with the high court’s decision and called on Gov. Greg Abbott to intervene.

“Now is the time to halt these cuts, make immediate changes to the policy implementation that is impacting care and call on managed care organizations to stop denying vital care to kids,” she said in a statement.

Child welfare advocates said the decision would harm vulnerable Texans.

“There is going to be heartbreak when parents find out their children with disabilities won’t be able to get help learning to walk or eat,” said Stephanie Rubin, chief executive of the advocacy group Texans Care for Children, in an emailed statement. “We need the Legislature to put these therapy cuts on hold until they can come back next year and ensure kids with disabilities and developmental delays get the support they need to reach their potential.”

A spokeswoman for the Texas Health and Human Services Commission, which oversees Medicaid, did not immediately return a request for comment.

Read our related coverage:

  • Cuts in the state’s payments to therapy providers who see children with disabilities remain tied up in court, but Texas officials said last week that they have made about $58 million in cuts from other parts of the health care budget.
  • Comments by high-ranking Texas Republicans indicate that the state’s long-running tug-of-war with the federal government over Medicaid expansion is unlikely to change course.

Author:  –  The Texas Tribune

Lack of Medicaid Expansion Costing Texas Billions

AUSTIN – Texas has the most uninsured people in the country, but state officials have rejected an almost cost-free expansion of the federal Medicaid program.

As many as 1 million Texans fall into the coverage gap, where they don’t qualify for Medicaid but can’t afford health coverage through the Affordable Care Act. According to a new report, not expanding Medicaid not only affects low-income individuals but puts a major strain on the state economy.

Patrick Bresette, executive director of the Children’s Defense Fund-Texas, said polls show most Texans are in favor of Medicaid expansion.

“A pretty strong majority of Texans actually think we should expand coverage,” he said. “I think the latest research and a survey was 63 percent of Texans across partisan lines thought we should be expanding it. So, there’s really no excuse other than some sort of a political feud with the federal government.”

According to this week’s report from the Georgetown University Center for Children and Families, the lack of Medicaid expansion cost the Texas economy almost $8 billion in 2015, with local governments paying another $5 billion for uncompensated care.

Report co-author Jack Hoadley said the 31 states that have expanded Medicaid have seen dramatic reductions in the number of uninsured people, millions of dollars in savings for hospitals and community health centers, and significant reductions in the cost and amount of uncompensated care.

“We heard from one clinic that said the share of uninsured patients had dropped from 51 percent of all their patients to 17 percent,” he said. “So, it’s really a dramatic drop, and you just don’t see those same kinds of changes in the non-expansion states.”

An infusion of Medicaid dollars often causes a ripple effect in state health-care systems, Hoadley said, expanding coverage, bringing new programs and improving care, particularly in rural areas. Under the Affordable Care Act, states are eligible to expand Medicaid at no cost through 2016, with a 90-10 federal-local cost-share beginning in 2020.

The report is online at ccf.georgetown.edu

Author: Mark Richardson, Public News Service (TX)

Texas mulls who profits from Medicaid

Texas was within eight days of slashing the amount of money it pays therapists for poor and disabled children when a state district judge last month stepped in and blocked the move.

It was the latest round in a high-profile legal and public relations battle that has ensued since lawmakers ordered a roughly 25 percent cut in Medicaid funding for pediatric therapy services. The conflict has mostly been cast as a battle between government budget ax wielders and helpless children, and the cuts are now in limbo at least until a January trial date.

Meanwhile, the Texas Health and Human Services Commission must figure out a new plan to slash payments to therapists — which Texas officials say are more generous than payments in other states — without closing down the sometimes big businesses that have come to rely on that cash flow to provide care to vulnerable Texans.

For home health companies, a lot of money hangs in the balance — about $4.5 million per year for his company, says Michael Reiswig, president and chief executive of Dallas-based Care Options for Kids, which is among those suing the state over the cuts.

Claiming to be the largest pediatric home health agency in the state, Care Options has about 400 employees. At any given time, the company says, it is sending speech, occupational or physical therapists to help 2,600 Texas children in their homes, paid for by Medicaid, the public insurance program for the poor and disabled.

Last year, Reiswig said his company earned a 5.6 percent profit for its owners, including the private-equity firm Ancor Capital Partners, which owns one-third of the company.

Current and former state officials say Texas’ payments to therapists from Medicaid have been unnecessarily high for at least a decade. Lawmakers, arguing that Texas pays therapists more than other states, ordered a $100 million payment cut to the program last session.

But some analysts say it would be a mistake to try to cut payments so forcefully that providers like Care Options, whose finances rely on serving Medicaid kids, would be forced to close at once.

“The state arguably has had bad public policy in place for a number of years, or incorrect reimbursement rates,” said Billy Millwee, a former Texas Medicaid director. “Well, now you have a whole industry that has built a business model on that, and it’s serving the Medicaid population, so you don’t turn it on a dime.”

After the court’s ruling, even some of Texas’ most fiscally conservative stalwarts seemed to have been persuaded by that argument — and Lt. Gov. Dan Patrick wrote a letter indirectly telling Health and Human Services Commissioner Chris Traylor to cut less if he had to. That’s left the health commission to decide how to best save money while appeasing providers, who say they’ll be forced out of business if they can’t continue reaping what they say are modest earnings.

Reiswig, through a spokesman, declined to be interviewed for this article. But in a prepared statement, he said that “clinical excellence for the patient and family comes first” at Care Options for Kids, and that his private-equity backers had never been paid a dividend.

“Our profits have, and continue to be, reinvested back into the business to provide for advancements in independent research and technology,” he said.

State policymakers say they have targeted pediatric therapists for payment cuts almost every year since 2005, but those cuts have hit rehabilitation facilities and independent therapists harder than home health providers, state records show.

The health commission says it pays in-home therapists in the Medicaid program more than Medicare, the federal insurance program for the elderly, does. That’s a rarity for Texas Medicaid, considered a frugal payer for most health care services. Primary care doctors, for example, earn only about 65 cents from Medicaid for every dollar they get from Medicare.

Home health agencies’ comparative good fortune when it comes to payments, even in years of budget shortfalls, “speaks to how connected these guys have been politically,” Millwee said.

But this year, that trend changed abruptly. Even some of those who believe payments should be cut say what lawmakers ordered may have been too drastic. An internal memo from the health commission warned the proposed cuts could have “serious negative implications for the maintenance of an adequate therapy provider base,” according to court statements.

Reiswig testified in court that in some North and West Texas markets, such as Abilene, his company is the only home health therapy provider. If cuts force him to close, he said, it would jeopardize disabled children’s health in those regions.

Not everyone, however, believes the gloomy predictions. In much of Texas’ Medicaid program, private insurers are responsible for maintaining a network of health care providers for their members. Several of those insurers have said, publicly and privately, that they already pay well below Texas’ Medicaid rates for therapy and that they do not anticipate any issues with the cuts.

“We would have no problem with our Medicaid members accessing a therapist with the proposed rate cuts,” said Mary Dale Peterson, chief executive of Driscoll Children’s Health Plan, a Medicaid managed-care organization in South Texas. “We have plenty of therapists in our network.”

Not-for-profit therapy providers and advocates for children with disabilities have voiced concerns over the cuts, but they have distanced themselves from for-profit providers. Many providers in the federal-state Early Childhood Intervention program, which serves developmentally delayed children under three years old, asked the health commission to exempt them from the Medicaid cuts because they are a different sort of health provider.

In that program, teams of therapists care for children in their homes and social workers help link families with community services such as pre-kindergarten programs. Federal and state funds pay for much of the program’s costs, but in many cases, the Early Childhood Intervention providers can bill Medicaid t0 make up the remaining balance.

With the Medicaid therapy cuts, “all it means is that the state is going to fill a bigger gap on the back end,” said Tod Marvin, chief executive of Easter Seals Central Texas, a provider in the program.

“Honestly, it’s so infuriating that these cuts were made under the implication that people are profiting huge,” Marvin said. “If there are a few people out there who are unscrupulously profiting off of these Medicaid rates, then deal with them. But the huge vast providers of Medicaid services — to suggest that if one is doing it, all are — shows a level of misinformation and uneducated perspective.”

The number of Medicaid patients receiving therapy services, whether at home or in a facility, has grown nearly 40 percent since 2009, from roughly 170,000 to 240,000 Texans. About two-thirds of those were children, according to the health commission.

Meanwhile, spending on home health agencies that provide speech, occupational and physical therapy grew more than 230 percent between 2009 and 2013— from $99 million to $328 million.

The Texas Association for Home Care and Hospice, which represents the home health industry, has criticized the state for making cuts without providing an explanation for that growth. Cutting payments to providers, they say, could simply exacerbate problems in a state where a growing number of children need therapy services.

They take umbrage at suggestions made by some Republican leaders, including Lt. Gov.Patrick, that fraud or waste may be responsible for much of the cost growth. Patrick, who wrote to the health commission to defend the decision to slash payments in order to “hold the line on waste, fraud and abuse,” also told the health commission it had the flexibility to make less drastic cuts in order to protect children’s wellbeing.

Patricia Gray, a former House Democrat and health law researcher at the University of Houston, said she was personally supportive of pediatric therapy providers because of her experience raising a developmentally delayed “young relative” who benefited from speech therapy and is now excelling in school.

But, she said, “I do recall from my time in the Legislature a home-health provider in my county saying, ‘Some of these folks ought to be ashamed of themselves. If you can’t make money in this business, then you don’t know what you’re doing.'”

Gray said the health commission should more transparently collect information about home health agencies’ finances and costs, because that would “really let people either be more empathetic to the position that the state is in, versus telling some young woman whose child has a medically diagnosed speech disorder, ‘You don’t get therapy anymore.’”

Disclosure: The University of Houston was a corporate sponsor of The Texas Tribune in 2013. A complete list of Tribune donors and sponsors can be viewed here.

Author: by Edgar Walters – The Texas Tribune

The Texas Tribune is a nonpartisan, nonprofit media organization that informs Texans — and engages with them – about public policy, pol itics, government and statewide issues.

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