Following an outcry from dozens of state lawmakers, Texas’ top health agency announced Thursday it will make less drastic cuts than originally planned to a therapy program for children with disabilities, even if that means spending more than lawmakers budgeted for the program.

Texas Health and Human Services Executive Commissioner Chris Traylor said in a letter to Texas Senate leadership that his agency would work to “preserve access to care even if it means” the full budget cuts lawmakers passed this year “cannot be achieved.”

The announcement comes amid expanding turmoil — including a lawsuit, vocal protests and lawmaker backpedalling — over legislative efforts to trim costs in the Medicaid-reimbursed programs. Therapy providers said the cuts would impede about 60,000 children from getting needed speech, physical and occupational therapy.

State lawmakers this year ordered the health agency to cut $100 million over two years in payments to those therapists. But the therapy providers cried foul, saying many of their businesses would close under what amounted to a roughly 20 percent revenue reduction. Families of children with disabilities, who said they would lose access to medically necessary services, also filed suit against the state. And more than 60 lawmakers, who crafted the budget ordering the cuts, wrote Traylor urging him not to harm the children using the services.

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On Wednesday, Lt. Gov. Dan Patrick and lead Senate budget writer Jane Nelson, R-Flower Mound, wrote to Traylor to defend the cuts, but in doing so told Traylor he had “the flexibility to strive for achieving $100 million savings in Medicaid therapy services while preserving access to services.”

Traylor said Thursday he interpreted that letter to mean his agency was free to make smaller cuts than were outlined in the budget provision, known as Rider 50, in order to ensure Texans receiving therapy services would not lose access to them. That was an entirely new tack from the week before, when lawyers for the state testified in court that Traylor was required to make the full cuts ordered by the legislature.

“HHSC will continue its efforts to achieve the maximum therapy rate reductions possible while maintaining adequate access to care,” Traylor wrote in the Thursday letter. “Even though this direction will not result in the full amount of savings identified in Rider 50 and will result in spending levels above appropriations, I am confident that the state can achieve meaningful Medicaid savings, while preserving adequate access to care.”

Therapy providers had accused the state of failing to study how the cuts would affect access to care. A state district judge in Travis County last week sided with the providers, issuing a ruling that prevented the cuts from taking effect on Thursday.

It was not immediately clear Thursday how the health commission plans to modify the planned cuts, or whether the announcement would affect the status of the ongoing lawsuit.

Reference Material

HHSC Letter to Dan Patrick and Jane Nelson
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