Lawmakers seek ‘innovative’ health options as Texas leads nation for most uninsured residents

About 68% of Texas’ 3.2 million small businesses do not offer health coverage to their employees, according to Texicare, a small business insurer affiliated with Texas Mutual.

Roughly half of Texans have employer-sponsored health insurance. On average, Texas families pay over $7,500 in annual employer-sponsored insurance premiums, while employers pay $15,000 per employee, according to Texas 2036, a nonpartisan policy organization.

A lack of transparency is driving high health insurance costs, senators said during the May 14 hearing. Sen. Charles Perry, R-Lubbock, said giving people the true costs of medical services—“the needle, the doctor, the electricity and the bed”—could help lower insurance premiums.

“We could get really honest about what premiums and stuff can and should be, and that would expand the ability for people to pay and afford them, possibly,” Perry said. “It's really frustrating to talk about health insurance costs when the cost is made up of something that reflects no sense of reality. ... There's no incentive for insurance companies to pay less and the system of health care delivery we have today demands the lack of transparency for it to work.”

In a Dec. 10 report, the Senate Health and Human Services Committee said lawmakers should look into ways to increase “innovative, alternative” health coverage options and consider requiring insurance providers to publicly list their prices to help people shopping for coverage.

“We need to make sure that the options and the information out there for the individual to make those choices is more accessible for the average person in Texas, so they understand what they’re doing and they can actually see the true cost,” Sen. Morgan LaMantia, D-Palm Valley, said May 14.

More details

Texas is one of 10 states that have not expanded Medicaid, a state- and federally funded program that provides health coverage to certain low-income people. Texans can qualify for Medicaid based on a combination of factors, including income, household size, pregnancy or disability status and age. In states with expanded Medicaid, residents can qualify based on income alone, according to the federal government.

About 750,000 Texans are in the “coverage gap,” according to Texas 2036, meaning they make too much money to qualify for Medicaid and too little to receive subsidized coverage through the federal health insurance marketplace. This is because the Affordable Care Act directed states to expand Medicaid, but the U.S. Supreme Court ruled in 2012 that states could make the decision themselves.

Several Democratic lawmakers have filed legislation to expand Medicaid in Texas. Medicaid expansion would cover Texans with incomes up to 138% of the federal poverty line, which is about $38,300 for a family of four.

It would cost the state about $700 million per year to expand Medicaid, according to Eva DeLuna Castro, a budget analyst in the office of Rep. Donna Howard, D-Austin. Texas would also receive about $7 billion in federal funding, DeLuna Castro estimated.

Put in perspective

Comprehensive health insurance, including Medicaid, improves access to health care, according to Alec Mendoza, a senior health policy associate with Texans Care for Children, a policy nonprofit.

“Uninsured individuals typically wait longer to seek medical care, leading to worse health outcomes and higher costs for families and taxpayers,” Mendoza said. “Oftentimes, [uninsured] families wait until it is an emergency for their kid ... and they end up going to the hospital, and then our hospitals, because those kids are uninsured, see higher costs of uncompensated care.”

Texans without health insurance can visit federally qualified health centers, or FQHCs, which offer medical care regardless of insurance coverage or a patient’s ability to pay. There are 75 FQHCs located across 127 Texas counties, according to the Texas Association of Community Health Centers. These centers may offer medical, dental and behavioral health care; pharmacy services; and other support for patients.

Health centers provide care to medically underserved populations and can help patients avoid expensive emergency room visits, according to the TACHC.

However, FQHCs and other charity providers cannot always keep up with the demand for health care, Mendoza said.

“Care is unavailable in many counties, especially rural ones, and many services like cancer treatment, kids’ eyeglasses, support for chronic diseases, and specialty care are often only available to Texans with insurance,” Mendoza said. “So these valuable services that families are in need of all around the state don’t really happen in a lot of these places.”