With staunch Republican opposition leaving Medicaid expansion on life support, a GOP lawmaker is pushing legislation to spend billions of government dollars to purchase private-market health insurance for the state’s poorest citizens.
State Rep. John Zerwas, R-Simonton, calls it the “Texas Solution.”
Instead of adding up to 1.5 million uninsured Texans to Medicaid under the Affordable Care Act, the Zerwas plan would extend coverage by plowing the money into private insurance policies, similar to an arrangement Arkansas is working out with the federal government, he said.
“To some extent, it’s an experiment, but one I clearly have a lot of confidence in,” Zerwas told a House subcommittee Tuesday. “Let us use this money, partner with the private sector and provide coverage.”
If approved first by the Texas Legislature, then by federal health officials, Zerwas said, the plan would bring a “big chunk of change” — up to $100 billion in federal money over 10 years — that Texas would otherwise lose by refusing to expand Medicaid coverage to low-income adults.
It remains to be seen, however, if Zerwas can overcome deep Republican suspicions over the source of the Medicaid expansion money — the health care reform law many call Obamacare — or concerns over the federal government’s ability to meet its financial obligations under the law.
With only 41 days left in the legislative session, time also is a growing problem for such a complex bill. On Tuesday, the subcommittee on transparency and reform delayed voting on Zerwas’ bill, and it would have to be approved by the full Appropriations Committee, then the House, before the process would begin anew in the Senate.
The Affordable Care Act was designed to extend insurance to low-income Americans by two methods:
• Expanding Medicaid to cover adults making below 138 percent of the federal poverty level, or $15,415 a year for an individual.
• Subsidizing private-insurance premiums for those making 100 percent to 400 percent of the poverty level, or up to $44,680 a year for an individual. The policies would be sold on an exchange run by the federal government.
The problem, Democrats and expansion supporters said, is that the people who most need health insurance — those below the poverty line — won’t be covered if Texas declines to expand Medicaid.
Zerwas’s House Bill 3791 seeks to extend coverage to those Texans with a three-step process.
First, it directs Texas officials to negotiate a block grant that would let the state craft its own Medicaid program, a longtime goal for Gov. Rick Perry and conservative leaders that is considered highly unlikely to receive federal approval.
Second, if the block grant fails, Texas officials would seek a federal waiver to use Medicaid expansion funds to help low-income Texans purchase private insurance. The bill stipulates that the system couldn’t raise the state budget, and participants would have to share the costs through co-pays and deductibles, Zerwas said.
Third, if the waiver request fails, Texas would plow premium taxes — collected on policies sold through the government-run health insurance exchange — into private insurance plans for low-income Texans. Zerwas said he didn’t know how many Texans would be helped by the third option.
Anne Dunkelberg, associate director of the Center for Public Policy Priorities, testified Tuesday that most of those who would qualify for Medicaid expansion are the working poor, particularly those in retail, construction and food service.
“I think a lot of times there is this strong misperception that we’re talking about an unemployed population, when in fact these are the hard-working, front-level backbone of our working population,” Dunkelberg said.
The subcommittee’s chairwoman, state Rep. Myra Crownover, R-Lake Dallas, offered another perspective on the state’s high rate of uninsured citizens.
“Often, people that can well afford high-deductible health insurance don’t want it, they don’t see the need for it,” Crownover said. “I think we always paint a picture of people crying in bed at night because they don’t have health insurance, and I really don’t think that’s true.”