Good for the Biden administration putting the pressure on.
The Biden administration on Friday rescinded changes to a federal funding agreement, known as a 1115 waiver, that would have extended for 10 years Texas’ health care safety net for uninsured residents — teeing up a new round of negotiations before the existing waiver expires in 2022.
The Centers for Medicare and Medicaid Services said in a statement that it erred in exempting the state from the normal public notice process before granting an extension to the waiver in the waning days of the Trump administration.
The agency “has rescinded the extension approval, which corrects this oversight with as little impact as possible to the people of Texas, since the original demonstration remains intact through September 30, 2022,” it said in a statement.
The Washington Post, citing two federal health officials, said the decision was a bid to push Texas toward expanding Medicaid to cover more low-income adults, a move the state and eleven others have resisted.
The 1115 waiver reimburses hospitals for the “uncompensated care” they provide to patients without health insurance and pays for innovative health care projects that serve low-income Texans, often for mental health services. The extension — worth billions of dollars a year — would have continued hospital reimbursements until September 2030, but allowed the innovation fund to expire this year.
The earlier waiver is still in effect, and federal authorities “stand ready to work with the state” if it wishes to extend it beyond next year, according to a Friday letter from the Centers for Medicare and Medicaid Services.
The state’s rationale to get out of the normal public notice process was that health care providers needed financial stability during the coronavirus pandemic, the letter said. But the state’s request did not “meaningfully explain why the extension request addressed the COVID-19 public health emergency or any other sudden emergency threat to human lives,” it said, in part.
See here for some background, and be sure to click on the NBC News link in that post. The 1115 waivers were used during the Trump years to approve the skinniest and stingiest Medicaid expansions possible, and in typical Trump fashion were done with zero regard for existing law or protocol. The Chron has some more details.
While the state’s current 1115 waiver won’t expire until September of next year, the reversal has immediate political impacts because the state Legislature has only weeks left in its session and won’t meet again until 2023. Without certainty over how much the federal government will contribute going forward, lawmakers risk leaving huge funding gaps for counties and hospitals.
Texas Republicans, who control the state government, have long campaigned against the Affordable Care Act and have declined to expand Medicaid under the act’s provisions as they seek to overturn the law in court. The state has depended on the waiver system as a cheaper alternative that nonetheless leaves millions of Texans uncovered.
Today, Texas has the highest uninsured rate in the country, with nearly 1 in 5 people lacking coverage. That results in staggering amounts of uncompensated emergency room visits each year, some of which is reimbursed by the 1115 waivers.
Earlier this year, a group of national health associations including the American Cancer Society, the American Heart Association and the American Lung Association called out the Trump administration’s expedited approval, saying there was plenty of time to hold a public comment period before the existing waiver expires next year.
“The waiver application was hundreds of pages, I don’t think it even mentioned COVID,” said Joan Alker, a Medicaid expert at Georgetown University who had signed on to the letter. “So it was a blatant disregard of what the exemption was supposed to be for.”
The Texas Hospital Association said it was disappointed with the decision.
“This action undermines the safety net and hospitals’ ability to protect people,” president Ted Shaw said in a statement. “It puts the state’s health at serious risk and creates unprecedented levels of uncertainty for an industry that is charged with saving lives.”
Others noted that the waiver was never meant to be a permanent solution.
“The waiver was always intended to serve as a temporary bridge until the state implemented an insurance option — with federal Medicaid expansion funds — for low-wage workers whose jobs don’t provide health coverage,” said Patrick Bressette, who directs the Children’s Defense Fund Texas. “Now would be a good time to have a real conversation about Medicaid expansion.”
Texas Sen. Nathan Johnson, a Democrat from Dallas who authored an expansion bill that has some Republican support, said the state should immediately reapply for the waiver while also taking up the expansion question.
“The story being told on the Republican side is Biden’s taking away resources from vulnerable people. False,” he said. “There’s still time left under the old waiver protections to do this the right way.”
I can understand why the Texas Hospital Association is unhappy with the decision, but the root of that is the failure to expand Medicaid, which has cost Texas hospitals tons of money. The waiver lets them get a few of those dollars back, but why settle for pennies when the dollars are available? Do the expansion, like we should have done a decade ago, and everyone is better off. It may be late in this session but there will need to be at least one special session for redistricting anyway, so the legislative calendar isn’t actually a problem. The choice and the benefits are clear, and the only reason not to is sheer partisan obstinance. Quit whining and get it done already.