Inside a Perilous Session: Hospitals Triumph Amid Turbulence

Amid the ongoing pandemic, the Texas' 2021 regular legislative session yielded significant outcomes for Texas hospitals and our health care infrastructure.


Those who follow the Texas Legislature know that each legislative session is characterized by its own unique energy. A stark contrast from the kumbaya session of 2019, this session was nothing short of frenetic. For many, it was among the most difficult in recent years. And the end still is not yet in sight. While the regular session ended Memorial Day, lawmakers returned to the capital city July 8 for one of what likely will be several special sessions. Still, amid the ongoing pandemic, the regular session yielded significant outcomes for Texas hospitals and our health care infrastructure.

The Disaster-Ridden Early Days of Session


Uncertainty—a pervasive theme over the past 15 months—marred the early days of the 87th Texas legislative session. The pandemic-induced economic downturn meant the state had far fewer dollars to spend than projected. Balancing the next two-year budget would require cuts. Along with the small cohort of freshman lawmakers, disposable masks, copious hand sanitizers and plexiglass dividers also found a new home at the Texas Capitol. After being closed to the public for months, access to the building became contingent on a negative COVID-19 test result from the testing tent affixed outside the north entrance. “The halls seemed eerily quiet,” said Sara Gonzalez, the Texas Hospital Association’s vice president of advocacy and public policy. The Texas House of Representatives adjourned for days on end. Committee hearings did not pour with people, as public testimony was taken via Zoom. The pandemic cast an unmistakable cloud over the Capitol and, to some extent, the legislative process early on.

But about a month later, another curve ball emerged. This time, in the form of a catastrophic winter storm that the Lone Star State was utterly unprepared to weather.

Having rendered the state powerless for days, Winter Storm Uri ignited frenzy among lawmakers and their constituents. State leaders were on a mission to get to the bottom of this crisis and fix it, quickly. In addition to human life, the state’s infrastructure and public reputation was on the line. Some lawmakers were tasked with improving and winterizing the state’s power grid, while others focused on the financial implications and the state’s preparedness for future disasters. With a new crisis at the forefront, layered on top of an ongoing pandemic, it was all-hands-on-deck.

Hospital Wins Despite Legislative “Kerfuffles”

The legislature took important steps early on to address some of Texas hospitals’ most pressing needs, including liability protection and dialysis access. Lawmakers also sought to “fix” certain policies on which the pandemic shed a new light, such as hospital visitation and hospital-required vaccination of staff. Hospitals prevailed in all these cases. The governor signed into law, with immediate effect, liability protections for hospitals and other health care providers acting in good faith during the pandemic. To remedy the dialysis issue patients and hospitals realized during Hurricane Harvey and the February blackouts, THA worked with Houston-area lawmakers to successfully strengthen requirements for end-stage renal disease facilities to ensure access to dialysis treatment during emergencies. THA navigated a delicate balance with lawmakers who wanted to end hospital visitation restrictions during public health emergencies and settled on allowing one visitor with appropriate protocols. Notably, THA fought hard, down to the wire, to preserve hospitals’ ability to require staff to be vaccinated against vaccine-preventable illness like COVID-19.

Addressing the fallout from the winter storm and pandemic captivated lawmakers for a period. But eventually those topics took a back seat to more splashy issues, like whether transgender children should participate in school sports, whether Texans should be able to carry a firearm without a permit and whether social media companies should be able to censor free speech on their platforms.

Disagreements on these and other “red meat” priorities were contentious and ongoing between the House and the Senate. Both chambers killed large swaths of the other’s bills out of retaliation. The rivalry peaked in late May. In a last-ditch effort to stop the bill they viewed as “voter suppression,” House Democrats walked out of the House chamber and broke the quorum that was needed to pass Lt. Gov. Dan Patrick’s (R) priority “voter integrity” legislation. This was a major loss for the GOP state leaders and lawmakers whose sights are set on the March 2022 Texas primary.

As punishment for killing some of his key priorities, the governor line item vetoed the portion of the 2022-2023 state budget that funds the legislature. Because that budget begins Sept. 1, the governor called the July 8 special session to address the legislative branch funding among a number of other issues. Much remains to be seen, as at the time of this writing, House democrats broke quorum again during the special session. This time, fleeing the state to avoid the voter bill. They are not expected to return until after the special session ends Aug. 6. Another 30-day special session also is scheduled for redistricting. Lawmakers anticipated this because the pandemic delayed the release of 2020 census data that is needed for the once-a-decade redistricting job.

The 87th Texas Legislature has its quirks. On the floor of the House during the regular session, a Plano-area Republican aptly noted that a “kerfuffle” (or two) between the House and Senate had derailed progress on important legislation. He wasn’t wrong. Nonetheless, this context helps put into perspective the value of hospitals’ policy and funding successes during a time marked by considerable turbulence.

Health Care Spending

In July 2020, the state faced a major budget deficit. State agencies were asked to cut their current budgets and their budget requests for 2022-2023. Rumors of other across-the-board cuts were rampant. By January, an increase in sales tax revenue helped reduce the deficit. More good news came in April when lawmakers were finalizing the budget. Texas Comptroller Glenn Hegar (R) announced the state’s revenue estimate was no longer in the red—an economic improvement he directly attributed to increases in COVID-19 vaccination and reduced cases and hospitalizations. With a positive balance and an increased federal Medicaid match rate, programs like Texas Medicaid, a favorite for budget reductions, sustained no cuts.

Adult and child hands holding an encephalography brain paper cutout

Overall, Texas hospitals fared well in the 2022-2023 budget. Budget writers appropriated $361 million to maintain state funding for safety net, trauma and rural hospitals’ Medicaid rate enhancements. They even provided $48 million in new state funding to further boost rural hospitals’ inpatient Medicaid rates. Lawmakers also directed the state health agency to pursue a federal waiver to eliminate the prohibition on Medicaid reimbursement for inpatient psychiatric care.

Behavioral and maternal health also saw legislative commitment in the form of new funding. Lawmakers spent $321 million from the state’s savings account, or the “Rainy Day Fund,” to continue the construction and renovation of the state’s inpatient psychiatric hospitals. They spent $86 million in state funds to bring online new state hospital beds and $30 million more to purchase inpatient psychiatric beds at community hospitals.

“Following a year filled with psychological and emotional distress, these are much-needed investments in our behavioral health system. We look forward to building on this commitment as the state continues to realize the full scope of the unmet behavioral health needs resulting from recent crises.”


ASSOCIATIONThe budget also increases state funding for substance use disorder prevention, intervention and treatment. “Following a year filled with psychological and emotional distress, these are much-needed investments in our behavioral health system. We look forward to building on this commitment as the state continues to realize the full scope of the unmet behavioral health needs resulting from recent crises,” Gonzalez added.

In addition to funding the TexasAIM program, which seeks to reduce preventable maternal mortality and morbidity, lawmakers appropriated $48 million in new state funds to extend Medicaid coverage for postpartum moms from 60 days to six months after delivery. Budget writers also provided an extra $10 million in state funds over current spending to fully fund women’s health services, family planning services and cancer screenings for women.

The state also supported the health care workforce with $19 million for the Professional Nursing Shortage Reduction Program and $199 million for graduate medical education to grow the number of first-year physician residency slots.

Health Care Coverage and the Medicaid 1115 Waiver

Increasing the number of Texans with comprehensive health care coverage was a top policy priority for Texas hospitals heading into session. And it still is among THA’s top priorities. But a once resolved issue is back in the limelight and now central to this discussion: the Texas Medicaid 1115 Waiver.

Hospitals have long advocated for expanding health care coverage for uninsured Texans. And, amid a major health care crisis that caused historic rates of unemployment, the need could not be more salient. To further tempt hold out states to expand, the federal government offered massive financial incentives that would have all but covered the cost to expand. Surely a state climbing out of the depths of financial peril would take the discounted opportunity to help its residents. This was the session to secure coverage expansion.


THA deployed a deep and wide-ranging grassroots and digital advocacy campaign to encourage the public and lawmakers to support comprehensive coverage expansion. We were making great traction. “We spoke with a lot of Republican lawmakers who were, for the first time, ready to publicly support this policy,” said John Hawkins, THA’s senior vice president of government relations. “They understood the need and the benefits.” More than 65 Democrat and nearly 10 Republican lawmakers signed on to support a smart solution for Texas’ coverage gap. This showing of support in and of itself was a monumental feat. The bill would have drawn down billions in federal funds to cover an estimated 1.2 million more low-wage working Texans, many of whom are essential workers.

Considering the politics of state leadership, the legislation faced an uphill battle. But the federal government’s decision in April to rescind Texas’ 10-year Medicaid 1115 Waiver extension sealed the bill’s fate. A vote for coverage expansion would be a vote for an untrustworthy administration. The rescission was a devastating blow to the state’s fragile health care safety net and the vulnerable Texans who depend on it. Ironically, the administration rescinded the extension over concerns that it would disincentivize Texas from expanding Medicaid.

happy mother kissing her baby son

Seeing the writing on the wall, newly elected House Speaker Dade Phelan (R-Beaumont) proposed an enticing alternative—a health care package with legislation to improve coverage for postpartum women, children and prescription drugs, among other meaningful health care advancements. THA supported these measures, and despite considerable leveraging by the Senate, the targeted coverage items passed in one way or another.

Postpartum moms now will have Medicaid coverage for six months after delivery. While six months is only half of what was originally requested, it is an improvement from the current 60 days. Instead of four eligibility checks a year, kids in the Medicaid program need just one to maintain their coverage for at least six months. Uninsured Texans can qualify for a rebate program to access life-saving drugs at discounted prices.

“Texans still need comprehensive health care coverage, and these new policies are progress toward that goal.”


“Texans still need comprehensive health care coverage, and these new policies are progress toward that goal,” said Jennifer Banda, J.D., THA’s vice president of advocacy, public policy and political strategy. Hospitals have the freshman speaker to thank for that. He championed Texans’ health care needs at time when it was seemingly unpopular. “These have been hospital priorities for years, and we will continue our advocacy for broader coverage,” Banda asserted.

Bills That Did Not Become Law


The legislative process is designed to kill bills. Many bills never get a hearing, and those that are considered often die at the 11th hour. Among the many THA-opposed bills that failed was one key holdover issue governing end-of-life care. According to Carrie Kroll, THA’s vice president of advocacy, quality and public health, despite this session’s win, the fight is far from over. “We saw this issue in the 2017 session and could see it again in 2023. At the end of the day, we always advocate for policies that best serve Texas patients and preserve their autonomy,” Kroll said.

THA closely is watching the special session activity, and through them all will continue educating lawmakers on the policies that are — and are not — needed to make Texas health care the best it can be for all its residents. THA will monitor the state agencies’ rulemaking activities to implement and enforce the new laws. HOSPAC, THA’s political action committee, will continue fundraising to support hospital-friendly candidates in the March 2022 primary election.

group photograph of THA's advocacy team

Learn more about THA’s advocacy during the legislative session at