House Gives Early OK to Health Care Compact

On Wednesday, House lawmakers put their initial stamp of approval on a health care compact — a partnership with other states to ask the federal government for control over Medicaid and Medicare in Texas.

But opponents say the proposal won't get much traction in Washington, where the Obama administration is unlikely to cede authority over the programs that provide health care for children, the disabled, the elderly and the very poor. 

House Bill 5 by Rep. Lois Kolkhorst, R-Brenham, would give Texas, in conjunction with other states, governance over Medicaid and Medicare — from their funding to how they are structured, who they cover, and which benefits they provide. It is a step further than the waivers many states, including Texas, are requesting to simply get control over Medicaid's purse strings.

“The health care compact is probably the ultimate block grant from the United States Congress,” Kolkhorst said before her bill got tentative approval, 102-46. “It asks for our funding for Medicaid and Medicare to flow down from the federal government.” 

Opponents say there's no way Washington will buy in. They say there's flexibility in the current system for states to seek waivers and tweak their Medicaid programs. Without federal oversight, they fear, states would simply shrink Medicaid and curb eligibility and benefits to do it. 

"We say we're going to deal with public policy. What we don't say is, we don't like [federal health reform], so we're going to try to find a way to nullify it, and we're going to bend the Constitution in order to do that," said Rep. Garnet Coleman, D-Houston, who argued that there's no way block grants can keep up with health care cost inflation, and that the state will find itself far short of the funding it needs.   

Conservatives say the compact is about who makes decisions about health care — Washington or the states. They argue states are in a far better position to determine their own needs than a one-size-fits-all federal plan. And they suggest compacts may not need a presidential signature, something Democrats say has been overruled in the past by the U.S. Supreme Court. (An amendment by Rep. Marc Veasy, D-Fort Worth, to add language about the necessity of presidential approval failed, 102-43.)

One of the compact's leading proponents, the Texas Public Policy Foundation's Arlene Wohlgemuth, has said she expects between five and 10 states to pass health care compacts this legislative cycle, and several more to sign on next year. Today, Georgia became the first state to sign a health care compact into law. By the summer of 2012, supporters hope to ship the compact off to Congress, where Wohlgemuth thinks the U.S. Senate will have trouble saying no to a chorus of states.

On Wednesday, Democrats raised a litany of concerns, from how such a program would be administered, to the state's historically limited coverage of low-income and needy Texans. An effort by Rep. Craig Eiland, D-Galveston, to strip Medicare out of the compact, and leave it at Medicaid, failed, after Kolkhorst argued the compacts need to look the same from state to state. "I don't want to scare our seniors," Eiland said. "I think we should do it one step at a time."