Medicaid Expansion and the Texas Legislature

As the time approached for the start of the 2021 Texas biennial legislative session, many people wondered if this would be the year Texas would pass Medicaid Expansion and extend coverage to over 1 million Texans. Supported by numerous studies showing Medicaid Expansion could severely cut into Texas’ nation-leading number of uninsured, health professionals and advocates entered the session with a great deal of momentum. Medicaid Expansion is a provision of the Affordable Care Act that allows states to expand Medicaid to cover persons who fall in the gap between Medicaid eligibility and the Affordable Care Act plan subsidies. Since the threshold to qualify for Medicaid in Texas is approximately $300/month for a family of four, this would provide coverage to a third of Texans without health insurance, an estimated 1.5 million people.

Several approaches to expanding Medicaid were offered; a basic Medicaid Expansion bill, a bill that called for a referendum of the voters on Medicaid Expansion, and a hybrid coverage expansion plan. Support coalesced around HB 3871, the hybrid coverage expansion bill that sought to expand coverage while addressing concerns that conservatives had about Medicaid. In the past opponents to Medicaid Expansion said that doctors didn’t like Medicaid because the reimbursements were too low. They also were concerned about what would happen if the federal government ended their 90/10 match. This bill addressed those concerns and others by:
– Providing an ‘opt-out’ provision if the federal government takes away the 90/10 match
– Encouraging physician participation through Medicaid-Medicare reimbursement parity
– Promoting individual responsibility by encouraging participants to contribute to a health savings account and giving incentives for healthy behavior.

In addition, the federal government provided an additional incentive for holdout states like Texas to accept Medicaid Expansion by offering dollars to help enact the expansion. This would translate to at least $3 billion additional dollars for the state.

HB 3871, also titled the “Live Well Texas” bill, eventually gained bipartisan support with a majority of the House members signing on as co-authors of the bill. It also gained popular support in Texas as over 200 organizations and businesses signed on to a letter supporting coverage expansion. However, this bill was opposed by the governor and several of his committee chairs who controlled the ability of this bill and similar ones to get out of committee for a hearing. Because of this, Rep. Garnet Coleman led the effort to attach a rider for coverage expansion to the budget bill during the House vote for the budget. With a majority of House members signed on to the Live Well Texas bill and a budget amendment that would allow for a similar expansion designed by Texas, this was the best chance to expand coverage to low-income Texans since 2013. However, coverage expansion failed 68-80 as overnight the rider lost support from eight key republicans who had supported it the day before.

This defeat severely hindered the possibility of passing Medicaid Expansion this session. Although maternal care was extended post pregnancy and there was a reduction in red tape needed to keep children on Medicaid, these additions will not have nearly the impact of Medicaid Expansion. However, this does not mean this session was a loss. For the first time since 2013 Medicaid Expansion was debated in a budget vote. The coalition for Medicaid Expansion was the largest ever and is continuing to work post session. This is an issue that will not go away until Texas figures out how to provide health coverage to those who need it most.