As GOP states flip, where’s the Texas answer on Medicaid?
by Mitchell Schnurman
November 30, 2013
Source: Dallas Morning News
There’s a silver lining in the fumbled rollout of Obamacare, even in Texas. Unfortunately, state leaders want nothing to do with it.
While HealthCare.gov was freezing up after its Oct. 1 launch, Medicaid enrollment took off. Texas added almost 12,000 people in the first month. That’s four times more than signed up on the federal exchange. And Texas isn’t even expanding Medicaid.
These are early numbers, but they show the pent-up demand for health care in the state.
It’s likely the sign-ups were mainly children, who didn’t know they were eligible until their parents applied. Credit the publicity over the health law for the welcome mat. But imagine what Texas could do if the governor actually tried to boost enrollment.
In contrast, check out Kentucky. It has one-tenth the number of uninsured that Texas has. Yet it signed up twice as many in month one. Kentucky operates its own exchange, expanded Medicaid and has 3,400 certified agents pushing the plans. And the governor is always promoting the Kynect program.
In the first month, Kentucky locked up health coverage for about 5.5 percent of its uninsured. Texas’ dent was 0.2 percent.
California also runs its exchange and embraced Medicaid, and it’s lapping Texas, too. It enrolled 114,883 people in both programs, while Texas signed up 14,673.
Blame HealthCare.gov. But don’t forget that Texas chose to not create its own website, just as it chose to reject Medicaid expansion. The state’s top elected leaders predicted Obamacare would fail, and they’re doing their part.
Last spring, Republicans in the Legislature trounced Medicaid expansion, despite support from hospitals and business. There’s also been no state effort to drum up enrollment in the exchange.
While other GOP-led states have reversed course, Gov. Rick Perry keeps slamming Medicaid.
“It’s like putting 1,000 more people on the Titanic,” Perry said at a recent meeting of Republican governors.
Much to gain
No other state stands to gain as much from the health care overhaul, because Texas has the highest share of uninsured and a large poor population.
More than 1 million residents fall into the state’s Medicaid gap; they earn too much for Medicaid and too little for federal subsidies on the exchange. Two million more are eligible for the subsidies, if they enroll and if HealthCare.gov can process the applications.
Texas leads all states in both categories, so it could expand coverage greatly starting next year. And the federal government pays nearly all the costs.
Funding for the health law comes from cuts in Medicare, hospital fees and prescriptions. There are also new taxes on high-earners, health plans, medical devices and more.
The bottom line is that Texans are paying for Obamacare whether 3 million residents sign up or a tiny fraction.
This fiscal reality is hitting home in more conservative states. At least 10 GOP governors now support Medicaid expansion, including late converts in Ohio and Michigan.
Virginia, whose governor-elect campaigned on expanding Medicaid, is among 21 states currently in the no category. The vast majority is trying to get to yes, said Matt Salo, executive director of the National Association of Medicaid Directors.
“What they’re saying publicly and doing behind the scenes are two different things,” Salo said. “But Texas may hold out longer than the others.”
If the rollout continues to be shaky and the White House gets desperate, states that delay may have more leverage.
“It’s political theater, but playing hardball may lead to a more flexible deal later,” said Devon Herrick, a health care expert at the National Center for Policy Analysis in Dallas.
He wants to see Medicaid expansion in Texas limited to the poverty line, rather than 138 percent of poverty. That would push more into the exchange and limit state costs when the federal match starts to decline.
To deal with the politics and ideology, some states are peppering programs with market ideas. Arkansas lets people use Medicaid dollars to buy private insurance in the exchange. Tennessee and Pennsylvania are considering the same formula.
Michigan submitted a proposal last month that includes health savings accounts. It wants discounts for avoiding alcohol and illegal drugs, and tax liens to ensure contributions.
Salo said some states want to require drug testing, job searches for the unemployed and a lifetime cap on benefits. He believes regulators will draw the line there, but they’re willing to deal.
They approved the Arkansas plan, and Salo believes they’ll allow more cost-sharing.
Many hybrid plans propose co-pays and premiums, so the poor will pay up to 5 percent of their income for health care. Emphasizing “personal responsibility” resonates with politicians and voters.
A rebranding push helps, too. “Healthy Michigan” sells better than expanded Medicaid. In Arkansas, it’s called the private option.
Somewhere, there’s a Texas answer.