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Updated: Hospitals, Advocates at Odds Over Preemie Bills

Lawmakers agree that curbing elective inductions of labor and so-called “convenience” cesarean sections would prevent premature births and save the state money. But how best to do it has left child welfare advocates and hospitals at odds.

Natasha and Mark Rosen, of Austin, with baby Matthew, who was born 3 months premature, in Seton Medical Center Austin's ne...

Lawmakers agree that curbing elective inductions of labor and so-called “convenience” cesarean sections would prevent premature births and save the state money. But how best to do it has left child welfare advocates and hospitals at odds.

Hospitals are backing legislation by Rep. Lois Kolkhorst, R-Brenham, that would cut off Medicaid reimbursements for providers who induce labor before the 39th week of pregnancy. But they’re opposing a bill endorsed by early childhood advocates that would require early inductions or C-sections that aren’t medically necessary to be listed in the “medical provider” note on a birth certificate — data that would be collected by the Department of State Health Services (DSHS). That bill, SB 1050 by Sen. Royce West, D-Dallas, was passed out of the Senate Health and Human Services Committee on Tuesday.

"I've got my fingers crossed that it's going to pass," West said. "I've got to make sure I've got the coalition of the Republicans and the Democrats of the Senate, and make sure the House members feel the same way that we do. And given the budget cuts to health and human services, I think they probably will."

Eileen Garcia, chief executive of the nonprofit Texans Care For Children, said the only way to truly curb unnecessary procedures and protect babies is to set up a detailed reporting mechanism for all deliveries, not just Medicaid births.

But hospital officials say such reporting requirements would be onerous, and wouldn’t get at the root of the problem. West's bill, they say, would require hospital personnel to go through each individual medical record to find the reason for the early delivery — something determined by a physician, not the hospital. And even then, they argue, DSHS, facing the same budget challenges every state agency is, doesn’t have the resources to collect or prepare the data.

“The right way to change behavior is through the payment system, and through an integrated, coordinated system of care for both mother and baby,” said Jennifer Banda, senior director of government relations for the Texas Hospital Association. If you start with Medicaid, she said, “other payers will follow suit.”  

But child welfare advocates argue that Kolkhorst’s bill won’t change enough on the payment side — and surmise that’s why hospitals support it. For starters, the bill will only affect Medicaid births, which make up roughly half of all the state’s deliveries. And they say the way hospitals are reimbursed by Medicaid is difficult to police. It will be up to the resource-strapped Health and Human Services Commission to enforce the rule, via auditing of claims long after the fact. 

“It’s easy to say, ‘We don’t want to report it, but just don’t pay us for them,’” Garcia said. “The truth is, they will continue to get paid, and HHSC won’t be able to enforce it.” 

Aziza Musa and Becca Aaronson contributed to this report. 

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