Turns out the federal government has more leverage over Texas than you might think.
If Texas wants to keep receiving billions of federal dollars to help hospitals care for uninsured patients, state lawmakers may have to look again at expanding Medicaid coverage for impoverished adults, some political observers say.
That’s because in 2016, Texas will have to ask the federal Centers for Medicare and Medicaid Services to renew a five-year waiver to pump $29 billion into state health care coffers.
Since landing its first such waiver in 2011, Texas leaders have defiantly refused to expand Medicaid as envisioned under the Affordable Care Act, leaving more than 1 million impoverished Texans with no health insurance.
With the waiver renewal nigh, observers said, there’s some expectation that the federal agency will hold the waiver approval hostage in exchange for Medicaid expansion.
“CMS is going to hold that over Texas’ head to say, ‘You want this money? You do the expansion,’” said Matt Salo, executive director of the National Association of Medicaid Directors. “It’s one of the points of leverage that CMS now has.”
Texas received the 2011 Medicaid waiver in part to reimburse hospitals for care provided to patients who couldn’t pay. Two years later, state leaders under Gov. Rick Perry declined to expand Medicaid, criticizing the program as inefficient.
That left a “coverage gap” of more than 1 million Texans too poor to receive federal subsidies for private health insurance but too rich to qualify for coverage under Texas’ current, restrictive Medicaid requirements.
Now, policy analysts on the left and right say, the feds are likely to be less sympathetic to Texas’ request for another waiver to help pay for uncompensated care.
A similar tug-of-war is playing out in Florida, said Joan Alker, executive director at the Center for Children and Families at Georgetown University. In May, the federal government renewed Florida’s waiver to reimburse hospitals for just one year, rather than the standard three, “which was very unusual,” Alker said.
State Rep. John Zerwas, R-Richmond, one of the lawmakers who advocated for the “Texas solution,” said the Legislature would revisit coverage expansion during the session.
“It still behooves us as a Legislature to figure out, what’s the policy going to be around these people?” he said. “I’ll be the first to say that finding a solution for these million and a half people is important.”
And the transformational waiver from 2011 is already a source of some conflict with the federal government. CMS is currently withholding $75 million in waiver money that Texas used to reimburse private hospitals while federal officials review whether any rules were broken.
Tiffany Hogue, policy director for the Texas Organizing Project, which has worked to get Texans to sign up for health coverage on the exchange, said Medicaid expansion would be a top priority for her group during the legislative session.
“It’s absolutely going to be a battle cry for us,” she said. “The sheer number of uninsured — that’s daunting.”
Still, Alker said she was skeptical that Texas would expand Medicaid anytime soon.
“I remind myself when the Children’s Health Insurance Program was passed in 1997, Texas was the last state in the country to pick up the program,” she said. “That may be instructive moving forward.”
It’s always a safe bet to assume that the Legislature will fail to do the right thing when given the chance. I for one will be rooting for the feds to apply the screws as hard as they can in pursuit of a Medicaid expansion deal that would do untold amounts of good for more than a million people, not to mention be a nice bit of stimulus for the Texas economy. Making Ted Cruz’s head explode would be the cherry on top. Against that, when the Republicans from Greg Abbott on down (with the honorable exceptions of Zerwas et al) dig their heels in, perhaps this will finally be the impetus to get the Texas Medical Association to quit trying to placate the bullies and start working to actually further their own and their patients’ best interests.