Texas Medicaid enrollment increases despite state opting out of expansion

Even though Texas declined to expand Medicaid as a part of the Affordable Care Act, enrollment in the program continues to grow. With additional enrollment forecasted in future years in Texas, health care providers and government officials are realigning Medicaid eligibility standards because of the ACA to meet the demand of population demographics and to ensure payment for hospital services.

If Texas expanded Medicaid coverage under the ACA—which would have extended eligibility to parents and childless adults at or below 138 percent of the Federal Poverty Level—more than 1.2 million uninsured adults would gain coverage, according to the U.S. Department of Health and Human Services. The expansion would be paid in full by federal funds for the first three years, and federal funds would never fall below 90 percent of the cost thereafter, according to HHS.

However, U.S. Rep. Kevin Brady, R-The Woodlands, said Medicaid has grown to nearly 30 percent of the state budget, and the funding promises cannot be guaranteed due to large federal deficits. Additionally, Brady said further expansion of Medicaid would not resolve concerns about the size of the program.

"[Medicaid] has grown to nearly 30 percent of the [Texas] budget, larger than education funding and now crowding out needed investments in public safety, research and infrastructure for our growing state," Brady said. "Washington is offering a teaser rate to states of 100 percent funding the first few years and 90 percent federal funding in future years—a promise that, given the large deficits, simply can't be guaranteed."

As of August, 329,128 Texans have enrolled in Medicaid since Gov. Rick Perry declined to expand Medicaid as a part of the ACA in July 2012, according to the Texas Health and Human Services Commission's preliminary statistics.

"We have seen increases in the number of people receiving Medicaid in Texas and do attribute a lot of that to various impacts of the Affordable Care Act even though Texas did not expand Medicaid," HHSC spokeswoman Linda Edwards Gockel said. "In fact we anticipated an increase in caseloads, so we have that already figured into our budget."

Provisions in the ACA also led states, including Texas, to raise the Medicaid eligibility limit for children age 6 through 20 from 100 percent of the FPL to 138 percent, meaning that some children who were previously covered by the Children's Health Insurance Program—which covers children above Medicaid eligibility but at or under 200 percent FPL— moved to Medicaid, Gockel said.

In Texas, about 40,190 children are forecasted to shift from CHIP to Medicaid in 2014, with an additional 820,944 children between the 2015 through 2017 fiscal years, according to the THHSC.

Since August 2012, CHIP caseload numbers have dropped by 177,497, as of August, according to the HHSC.

Rosie McStay, Texas Children's Hospital director of government relations, said that children are ideal for the Medicaid eligibility changes.

"Kids are cheap; they are very healthy for the most part," McStay said. "Those that are really sick, you want them on a government program if they don't have private coverage because if they don't have any coverage, then we pay for it in local indigent taxes. That isn't a great deal for any of us."