Even as modern politics continues to be synonymous with turbulence and even occasional outright wildness, the Texas Hospital Association is pursuing a smooth landing and a sensibly realized bottom line as the 89th state legislative session takes flight beginning today.
THA’s intended landing spot: action from the Texas Legislature on a broad range of priorities to help hospitals not only stay open, but thrive while providing needed care to as many Texans as possible.
While Texas hospitals’ policy pursuits will be largely similar to those of 2023 and other recent years – such as taking another run at key behavioral health measures that didn’t earn passage last session, and working against any notions lawmakers have to slash vital funding – change will also be integral to how the session unfolds.
The Legislature gavels in today with a familiar level of tightly held Republican control, but with a sizable crop of new lawmakers, particularly in the House of Representatives. The House planned to elect a new speaker today after the incumbent gavel-holder, Rep. Dade Phelan (R-Beaumont), bowed out of the speaker’s race last month. And in Washington, D.C., the return of President-elect Donald Trump to the White House next week could wield sizable influence on what happens in Austin.
THA, meanwhile, must roll with all that change even as it navigates its own, with new leadership in its advocacy team charged with navigating a path toward session success. Whatever happens between now and the adjournment of the regular session on June 2, THA staff is prepared for extended stretches where the “Fasten Seat Belt” sign will be on.
Healthy hospitals, healthy patients
Finding the path will start with a focus on the big picture. Helping hospitals keep their doors open will require a concentrated push-and-pull: THA needs to impress upon lawmakers what hospitals need to stay financially viable, while also strenuously opposing policies that threaten facilities’ existence.
“Our top priority is always going to be that we need to keep our doors open to see patients,” said Carrie Kroll, THA’s senior vice president of advocacy and public policy, who enters her first session leading Texas hospitals’ lobbying efforts. “So it’s going to be focused on our funding streams – our ability to continue to work in an environment that allows us to focus on the needs of the community rather than worrying about whether or not we’re going to be able to continue to have a footprint.
“That’s how I visualize it, is [that] we have to maintain operations, and with that comes a plea for the necessary state funding. And then once we do that, it is a [matter of] how do we best serve our patients?”
Hospitals will advocate for continued state support of the Medicaid program, including stressing the importance of funding more closely aligning with the cost of care and supporting the maintenance of supplemental payments that cover unreimbursed costs. Hospitals need lawmakers to protect, and potentially increase, crucial existing add-on payments, such as the $1,500 payment for Medicaid rural labor and delivery services that lawmakers approved in 2023 – triple the previous payment amount.
Conversely, policies representing potentially devastating hits to hospital viability will require not only opposition from THA, but also lawmaker education on why those policies are so threatening. As part of its perennial opposition to reduced hospital reimbursements, THA will push back against site-neutral payment policies, which would dictate payment for care being the same regardless of setting.
The Legislature is likely to take another look at banning hospital outpatient payments – colloquially known as facility fees – which pay for all aspects of hospital operations aside from a physician’s professional fee. THA’s dire warnings about such a ban – including reductions in services and even closures of outpatient clinics – helped defeat a relentless anti-facility-fee effort during the 2023 session.
“Hospital finance is confusing, and it’s up to us to make it clear in terms of how facility fees are simply our payment. They’re not extraordinary, above-and-beyond payments,” Kroll said. “So I think that our efforts to educate legislators about that – especially when it comes to community hospitals educating their local legislators – we can be successful. It just takes all of us getting the message out, and to the right people.”
Behavioral health: Coverage is key
Once again, the state’s acute behavioral health needs lie both in broader insurance coverage and in recruiting behavioral health professionals, while also enticing them to practice in rural and underserved areas.
“From a behavioral health perspective, if you look at us as a state, we’re always at the bottom on a national level [for] psychiatric services, mental health services. And the level of provision as far as a per-capita number of facilities … we’re always at the bottom of that list as well,” said Jim Kendrick, president/CEO of Community Hospital Corporation in Plano and the 2025 chair of THA’s Board of Trustees. “So we need more facilities. But at the same time, in needing more facilities, we need more professionally trained people to do it. … All of these things are designed around increasing access to care, increasing the ability for someone to get care in the right setting.”
As it did in 2023, THA will support expanding the continuum of care in behavioral health to resemble the same continuum that exists in physical care. One of the primary ways for lawmakers to make that happen is requiring Medicaid coverage for partial hospitalization programs and intensive outpatient therapy, which are both “step-down” behavioral health services for patients who aren’t in need of a round-the-clock inpatient stay.
Meanwhile, a coverage gap still exists for adult inpatient care thanks to the federal “institutions for mental disease” (IMD) exclusion, which caps most adult inpatient behavioral health inpatient stays at 15 days. THA was unsuccessful last session in persuading lawmakers to pursue a waiver from the IMD exclusion, but this is one area where an encore Trump administration may help Texas hospitals make more headway: federal authorities introduced the existing option of an IMD waiver during the first Trump administration in 2018.
Other priority items for THA in behavioral health include an increase in both adult and pediatric inpatient psychiatric beds, as well as the contracted rates for those beds – and winning continued financial support for the state’s rural telepsychiatry program.
Workforce: Growing the ranks
Key wins on addressing workplace violence were a highlight of THA’s work in 2023, along with the passage of a nursing workforce omnibus bill, Senate Bill 25, which sought to help unclog a workforce pipeline that hasn’t been able to adequately staff the state with the health-professional manpower it needs. In 2025, progress on the pipeline will again be a point of emphasis. Among other actions, SB 25 created nurse preceptor grant programs to support expansion of clinical training for nursing students. However, the Legislature did not provide funding for those clinical-site programs. This year, THA is asking lawmakers to give the programs the support they need. Hospitals are also asking lawmakers to study and identify impediments to education and training for new nurses, including barriers to providing students with the clinical space needed to learn their trade. THA also will request an examination of all workforce shortages in health care, not just nursing shortfalls.
Defending vaccines
To the chagrin of THA and other defenders of public health, anti-vaccination forces – bolstered by four years of widespread skepticism of COVID-19 vaccines – are increasingly emboldened in their efforts to eliminate any and all vaccine requirements, even those tied to immunizations that have suppressed deadly childhood diseases for generations. Already, for example, prefiled legislation would require hospital vaccination policies to allow exemptions for any reason. President-elect Trump’s nomination of prominent vaccine skeptic Robert F. Kennedy, Jr. to run the U.S. Department of Health and Human Services could further galvanize more localized, state-level anti-vaccine movements.
THA will continue to defend hospitals’ right to create a safe environment for their patients and staff through requirements tied to long-standing, tried-and-true vaccines. Kendrick, THA’s board chair, stresses the importance of education regarding immunizations and the unique role of a hospital.
“Don’t take some new concern and take a broad brush and wipe out all of the things that we put in place for very good, thought-out reasons and understood reasons,” he said. “Whether or not you have to have the third, fourth, fifth and sixth new iteration of a COVID vaccination, we can address those things in political debate conversations, the state looking at it from an entire perspective on what’s the right thing for the health of the individuals of the state. But don’t take a sweeping approach and say, ‘Well, we’re not going to have any vaccinations required, period.’ That may be a different conversation in other businesses, but hospitals are a unique animal in the sense that people are coming to us for care. And in providing that care, we need to protect them against other things that we know our past actions have been good decisions to help limit the exposure that they have to other illnesses.”
The fate of these THA policy priorities, as well as other issues, will largely hinge on how receptive the new crop of lawmakers is to hospital messaging. Kroll is encouraged by a perceived openness to dialogue from the new House members THA has interacted with in the runup to session.
“I think that they’re all very interested in serving their communities, there’s no doubt in that,” she said. “To the degree that we are able to connect them to their hospitals, and that we’re able to represent the priorities of the hospital industry, I think there’s a willingness to have an open conversation and to understand the impact on their hospitals. So it really will be work between us and our member hospitals to make sure that that willingness benefits our priorities.”
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