State officials painted a grim picture of how much the federal health care reform will cost Texas, and cautioned lawmakers on Wednesday that the price tag will likely grow.
Health and Human Services Commissioner Tom Suehs said in a committee hearing that the measure’s top-dollar items — Medicaid expansion to an estimated 2.1 million people, and heightened reimbursement rates for primary care physicians — will likely cost the state more than $27 billion between 2014 and 2024, up $3 billion from his most recent estimate.
Insurance Commissioner Mike Geeslin cautioned against relying on specific dollar amounts. But he expects the state insurance department to engage in “one of the largest consumer education efforts” in its history, ultimately teaching millions of Texans how to buy health insurance.
“It will significantly impact Medicaid, our eligibility system, agency staffing needs, our efforts to address critical shortages in our health care work force, and of course our budget,” said Sen. Jane Nelson, R-Grapevine.
The state cost estimate stands in stark contrast to an analysis done by the nonprofit, nonpartisan Center for Public Policy Priorities, which estimated the federal reform would add up to 1 million adults to the state's insurance roll, and cost Texas next to nothing until 2017, when Texas would start paying a 5 percent share, or about $185 million. That share would grow to 7 percent, or about $259 million, in 2019, and top out at 10 percent, or $370 million, in 2020, according to last month's analysis.
While it's true the federal government is footing almost the entire bill for health care reform for the next three years, Suehs told lawmakers at a joint hearing of the Senate Health and Human Services and State Affairs committees that they will absolutely face unexpected costs to the state in that time period.
But he said there could also be some welcome savings, particularly in programs lawmakers have established in the past that only apply to people without insurance. “There are trauma funds, appropriated tobacco receipts, county indigent health care programs… and those dynamics all change when individuals have insurance,” Suehs said.
And he said he sees great opportunity for Texas to lead the way with payment reform, by applying for grants to participate in federal pilot programs. “Texas wants to be in the forefront of payment system reform,” he said.
Geeslin said the country hasn’t seen a policy undertaking like this one in decades, and that the insurance department needs to be ready to be flexible. “There could be court decisions, Congress could come back and make amendments. The best thing we can do… is be prepared for anything,” Geeslin said.
But he said one thing he knows is he will need more bodies — anywhere from 5 to 35. “I’m safe in saying we’re going to need more people, and the technology and training that needs to be wrapped around those people,” he said.