Advocates for low-income Texans warn that the state’s bill for Medicaid costs is likely to grow — which could potentially lead to loss of benefits for some residents — if Republicans move forward with their newly released plan to dismantle and replace the Affordable Care Act.
The proposed legislation, which the GOP dubbed the American Health Care Act, comes as budget writers in Austin are already wrestling with how to deal with nearly $2 billion in increased Medicaid costs.
The GOP plan would establish — among other things — a per-person cap on how much the federal government gives states for Medicaid.
But if federal funding for the program no longer grows along with health care inflation and other factors, some members of the local health care sector say Texas and other state governments either will have to bridge the gap or reduce medical benefits for poor and disabled people.
“If they don’t give (the states) enough money to pay for these services, the money is going to have to come from somewhere” or benefits will have to be cut, said Kay Ghahremani, chief executive of the Texas Association of Community Health Plans, a consortium of 11 health plans across the state that provide coverage to about 2 million Texans, most of whom are on Medicaid. “A per-capita cap is not in the best interest of any state.”
Larry Wallace, interim chief executive of Central Health, Travis County’s health care district, said he is concerned that the GOP plan could result in reductions in the federal government’s Medicaid payments to states, although he noted that the issue isn’t settled and he’s still monitoring it.
Central Health offers care for uninsured and underinsured people who aren’t eligible for Medicaid, so Medicaid cuts likely would increase the number of people who need its services. Central Health is funded through property taxes.
“It does concern us, and it should concern everyone in the community who provides health care,” Wallace said. “We are concerned about additional people being without coverage as a result of these actions.”
Texas lawmakers are debating how to handle an estimated $1.9 billion gap in the state’s Medicaid contributions. The figure includes a $1.2 billion shortfall in the current two-year budget cycle and an additional $700 million in the 2018-19 cycle to account for enrollment growth, according to the Center for Public Policy Priorities, a nonpartisan research group.
A spokesman for Gov. Greg Abbott didn’t respond for a request for comment Tuesday. State Rep. John Zerwas, R-Richmond — who chairs the Texas House Appropriations Committee and recently filed a bill that, among other things, calls for using the state’s “rainy day” reserve fund to bridge part of the Medicaid shortfall in the current two-year budget cycle — wasn’t available for comment.
In addition to the Medicaid changes, the U.S. House GOP’s planned replacement for the Affordable Care Act — commonly known as Obamacare — would eliminate the mandate that everyone have coverage or pay a penalty. It would also create a new tax credit tied to age and income to help individuals buy insurance.
The plan has gotten a mixed reception in Washington. Some Republicans contend the tax credits established under it are a new entitlement, while other GOP members say they fear it will result in lost coverage for many Americans. It remains to be determined how much the proposed legislation would cost or how many people might lose coverage under it, because House Republicans released it without estimates of those elements by the nonpartisan Congressional Budget Office.
President Donald Trump applauded the plan’s unveiling this week but also indicated he views it as a starting point rather than a finished product, saying it’s now “out for review and negotiation.” Some members of the Texas delegation followed suit, praising the willingness to offer a health care plan but avoiding endorsing it or commenting on its specifics.
U.S. Sen. John Cornyn, R-Texas, called the plan “a major step in the right direction” in a prepared statement, adding that “we need to move health care decisions out of Washington and send them back to the states and back to patients and families and their doctors.”
U.S. Sen. Ted Cruz, R-Texas, said he’s still studying the details of the proposed legislation and is “working closely with members of the House, members of the Senate and the Administration to pass a repeal bill that honors our commitment to repeal Obamacare, that lowers costs, that expands access and choices and patient control over your own health care.”
But Cruz reiterated his view that the Affordable Care Act should first be repealed and then the GOP should focus on areas of consensus to build a replacement.
U.S. Reps. John Carter, R-Round Rock, and Lamar Smith, R-San Antonio, were more enthusiastic about the new proposal.
“After voting more than 60 times to repeal and replace Obamacare, I am proud that House Republicans have introduced an innovative plan to replace this disastrous law,” Carter said. “The American Health Care Act preserves vital patient protections including protecting those with pre-existing conditions, lifting lifetime caps on medical care, and allowing dependents to stay on their parent’s plan until they are 26 years old.”
U.S. Rep. Lloyd Doggett, D-Austin, criticized the GOP’s health care plan before it was released, saying at a rally in Austin on Monday that every American should have “the basic right of health care.”
American-Statesman reporter Jonathan Tilove contributed to this report.