Texas Medicaid

Governor Rick Perry has decided Texas will opt out of the Medicaid expansion proposed under the Affordable Care Act. Dallas Area Interfaith, a community advocacy group I normally support, is campaigning to accept the expansion. I prefer the opt out.

Arguments in support of the expansion boil down to two. It will give health insurance to Texans who are uninsured today, which is partly true and, because it is paid for mostly with federal dollars, it is a bargain for Texas, an argument I reject on its face.

First some facts. Medicaid is paid for partly by the federal government and partly by the state. States are allowed to set eligibility requirements subject to minimums. Texas applies something close to the minimum. ACA sets a uniform eligibility of 133% of Federal Poverty Level, much higher than current Texas rules. The Feds pay all the added costs initially, 90% later on.

In Collin County there about 40,000 people currently covered by Medicaid, about three quarters of them children. It is almost impossible for a childless adult under 65 to qualify. But the County has a program to enroll bonafide residents with incomes up to 100% of FPL who can then get treatment from Primacare at county expense. There is an alternative program called Project Access Collin County which relies on physicians and hospitals to volunteer time and facilities for a limited number of patients. The county pays ancillary expenses for things like drugs, mammograms, and X-rays. PACC also accepts non "county patients" up to 200% of FPL if they don't have other insurance. In essence, in Collin County you can get access to health care if you are poor and uninsured even if you aren't eligible for Medicaid.

If Medicaid coverage is expanded the county program presumably goes away. All the people now covered by the county would be eligible for Medicaid, not necessarily a good thing because very few doctors accept new Medicaid patients. That is because payment levels are so low doctors can't afford more than a few of them and regulatory requirements are onerous. ACA attempts to address this by temporarily (for two years) raising payment levels to the same as Medicare. But what doctor is going to load up his practice with Medicaid patients if they are going to drive him out of business in two years? Insurance isn't much good if doctors won't accept it.

As for PACC they are left serving people with incomes between 133% and 200% of FPL, and those who don't meet Medicaid residency requirements. I'm not sure that is a viable proposition.

It seems to me this is a step backward for Collin County's poor. I don't know about the rest of the state and it may be that Medicaid covers services not provided under current county programs but that is a case I haven't seen anybody make.

Then there is the issue of how this is to be paid for. ACA uses funds saved by reducing Medicare payments to providers and insurance companies over time. But we've been trying to reduce Medicare costs with price controls for years and we know that doesn't work. Every year Congress has to pass a "doc fix", raising rates to prevent a mass exodus of doctors from the program. The only reason I can find a doctor who will accept my Medicare insurance is Medicare has more constituents than Medicaid and can bring enough pressure on Congress to pass the doc fix.

The bargain argument rest on the dubious proposition that Texans will receive better health care (I've already questioned that,) become more productive, and return net economic benefits. I don't see it well supported anywhere. I've even seen it said that it really doesn't matter anyway because the Feds will borrow the money. But just because other states are jumping on this bandwagon doesn't mean we should too. The piper will have to be paid. Obamacare is deeply unpopular and even if Obama is re-elected, we should know in a few days, I question whether congress will fund it. This is a bad idea and it is a loser.