Texas counties consider going it alone on Medicaid expansion

SAN ANTONIO —Local officials in Texas are discussing whether to band together to expand Medicaid coverage in some of the state’s biggest counties, making an end run around Gov. Rick Perry’s opposition to the expanded program included in President Obama’s health-care law.

For years, Texas’s six most populous counties, as well as some smaller localities, have offered free or low-cost health care for uninsured residents with incomes as much as three times the federal poverty level, or about $57,000 for a family of three. The cost of the programs: about $2 billion a year.

If some of the patients were enrolled in Medicaid, the state-federal health-care program for the poor, it could be salve for cash-strapped county budgets and a boon for local taxpayers.

George Hernandez Jr., CEO of University Health System in San Antonio, came up with the idea of the alternative, county-run Medicaid expansion, and said he has been discussing it with other officials in his county, Bexar. “They are all willing,” he said. He added that he has also been talking up the proposal with officials in other big counties, such as those including Houston and Dallas, and is optimistic they’ll support the idea.

Robert Earley, CEO of JPS Health Network, the public hospital system serving Tarrant County, which includes the Fort Worth area, said he could see the idea catching on.

The Medicaid expansion is a key part of the Obama health-care law, but its fate was thrown into question when the Supreme Court in June ruled that states could refuse to take part without being penalized by the federal government. Half a dozen Republican governors, including those in Florida, Louisiana and Texas, have already declared their opposition to the expansion, while several other governors, including some Democrats, have remained noncommittal.

The county-led effort would require the consent of both the White House and the Texas legislature. Federal officials would have to waive requirements that states apply the same eligibility standards statewide.

Whatever the plan’s fate, it shows that frustrated local officials don’t necessarily want to give the governor the last word on whether to accept millions of federal health aid that could ease local burdens.

In Bexar County, about half of the 55,000 people who get county-paid health care would be eligible for the Medicaid expansion, saving the county up to $53 million per year, said County Judge Nelson Wolff, the county’s top public official.

“That’s a pretty big chunk of money,” said Wolff, a Democrat. “We could cut taxes. Or we could expand some of our existing services. Either way, it has a big impact on us financially in terms of taking the pressure off.”

The novel alternative floated by county officials is a stark indication of the Lone Star State’s often-contradictory approach to health care for the poor.

On the one hand, Texas’s prevailing culture of distrust of Washington and emphasis on personal responsibility has resulted in one of the most restrictive Medicaid programs in the country. Working parents are eligible only if their incomes are at or below 26 percent of the federal poverty level. That’s one reason Texas has an uninsured rate of 24 percent, the highest in the country.

On the other hand, major urban counties for years have been stepping into the breach to cover the uninsured, creating hospital districts with taxing authority to fund not only public hospitals but also generous charity care programs.

Such a program was a welcome surprise for Alexandra Riojas, a 44-year-old mother of four who has stage IV colon cancer, no health insurance and who is not poor enough to qualify for Medicaid in Texas, even though her income is practically at the federal poverty line. “It’s such a blessing. . . . I just had no idea how I was going to pay for everything,”

Riojas, who was working in an embroidery store when she was diagnosed in November 2010, said, “I thought, if I can’t pay, I’m going to die even sooner from this than I have to.”

A local burden

More than half of the state’s population lives in one of the large hospital districts offering generous health care programs. Some of the counties, such as Bexar, cover illegal immigrants.

Under the federal health law, the Medicaid expansion would begin in 2014, and would cover people with incomes of up to 133 percent of the poverty level. The federal government would pay the entire bill for the first three years and 90 percent thereafter. If there were a county-backed expansion in Texas, the local hospital districts would tax residents to come up with the 10 percent state share. Texans living in counties that participated in the expansion would be eligible for Medicaid under the less restrictive rules, while those living in the rest of the state would not.

An official from the U.S. Department of Health and Human Services declined to comment on the idea, but said, “We look forward to continuing our dialogue with states . . . as we work to meet the law’s goals.”

Alan Weil, executive director of the National Academy for State Health Policy, said that the idea, despite its challenges, “is certainly not far-fetched.”

Weil noted that there is precedent for a federal waiver of this type: After California declined to take advantage of a provision in the health-care law that allows states to accelerate their Medicaid expansion, the leaders of several counties got permission from the Obama administration to do so on their own.

The Texas proposal, of course, represents more than a temporary bridge to statewide expansion; it could be a permanent arrangement.

“And federal authorities might feel differently about that,” Weil said. “But as a general proposition, could you have different counties with different eligibility standards? I think the answer would be yes.”

In many ways, Medicaid would be better for the poor than the county programs. For instance, the county programs do not technically function as health insurance. That means eligible residents can get care only at the public hospitals and facilities affiliated with their hospital districts.

Also, the county programs often require patients to shoulder more of the cost of their care — by making monthly payments based on their income, or paying co-payments such as the $10 that Christopher Mitchell handed over on a recent afternoon after stopping by JPS’s Center for Cancer Care for a check of his hemochromatosis — a debilitating blood disease.

Still, Mitchell, 31, who works in sales at a salvage yard, is grateful for the county program. He said his co-pays were “no problem” — nothing compared to the roughly $45,000 per year his parents paid to cover his medical bills before his family qualified for county help after his wife lost her job.

Christann Vasquez, chief operating office of San Antonio’s University Hospital System, is proud of the county programs but insists they are not a substitute for Medicaid. Even in Bexar, only about one-seventh of the low-income uninsured people who are eligible for the county program are actually served by it, partly because University Hospital System doesn’t have adequate resources to promote the program and sign people up. Often, patients find out about the program from hospital staff once they are already so sick they seek treatment at the emergency room.

“We know we are not capturing anywhere near everybody we need to right now,” Vasquez said. “With Medicaid, [low-income people] would know they can access the system and go to see a doctor so much sooner.”

Riojas is a case in point. For years, she didn’t get routine checkups because she assumed she could not afford them. Had she done so, a doctor might have learned that she had an aunt who died of colon cancer in her 40s, and suggested that Riojas get regular colonoscopy exams. But by the time doctors discovered her disease, her illness was so advanced that she was hemorrhaging blood.

 
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