Capping Medicaid Funding Would Inhibit Meaningful Reform
(Austin – April 4, 2018) During a hearing today at the Texas Capitol, the Texas Hospital Association will discuss the potential for federal health care reform initiatives to solve the state’s uninsured problem and provide insight for state lawmakers on the need for a strong but flexible Medicaid program.
John Hawkins, THA senior vice president of government relations, will testify before the Texas House of Representatives’ Appropriations Subcommittee on Health and Human Services (Article II), chaired by Rep. Sarah Davis (R-West University Place) on the potential impacts of Medicaid financing changes, including fixed federal funding through use of block grants or per capita spending caps.
“Through its Medicaid 1115 Waiver, Texas has long been a leader in driving local health care innovation,” said Ted Shaw, THA president/CEO. “Texas hospitals support building on this proven innovation and flexibility to address the state’s health care coverage, access and financing challenges. However, the reform proposals introduced to date that would cap Medicaid funding could inadvertently hurt a state like Texas that is experiencing both rapid population growth and growth in the number of lower-income residents.”
Texas Medicaid is well managed and cost effective, in large part because of the state’s Medicaid 1115 waiver and use of managed care. Between 2002 and 2016, per member per month Medicaid costs increased by only 17 percent, or just over one percent per year on average, according to the Texas Conservative Coalition Research Institute. By contrast, Medicaid caseload grew by 93 percent.
If not structured appropriately, per capita spending caps would penalize Texas for that efficiency and leave the state with insufficient funds, particularly compared with other states, to fairly and appropriately administer its Medicaid program.