Zerwas: House Medicaid Reform Bill Will Incorporate Williams' Plan

Updated April 3, 11:30 a.m.: 

State Rep. John Zerwas, R-Simonton, confirmed Wednesday that he will incorporate into his own Medicaid reform bill a proposal by Sen. Tommy Williams, R-The Woodlands, to use premium tax revenue to subsidize private health policies for the uninsured.

“It fits very well with Texas’ attempt to find a unique solution that would be sustainable,” Zerwas said. He said the measure would allow Texas to embrace some parts of federal health reform "earlier versus later," and would "hopefully bring insurance policies to these people that otherwise wouldn’t have them.”

According to early details, Williams' plan would scrape premium tax revenue from newly insured Texans who sign up for coverage under the state's health insurance exchange — an online insurance marketplace that is mandatory under federal health reform — and use it to subsidize private coverage for poor, uninsured Texans starting in late 2015. 

Medicaid expansion is “completely off the table — what I’m interested in is a reform program,” Williams said Wednesday morning.

Zerwas said he authored House Bill 3791 to craft a “Texas solution” to Medicaid reform that would allow the state to draw down federal Medicaid expansion financing while implementing cost containment reforms. So far, Zerwas has suggested those reforms include co-payments and wellness incentives, but the details of his plan remain thin.

Next week, Zerwas plans to offer a committee substitute of the bill in the House Appropriations Committee that would incorporate aspects of Williams’ plan, among other ideas. Specifically, he suggested Texas could use the premium revenue as matching funds to draw down the federal financing to cover the Medicaid expansion population and to offer premium support for poor individuals.

Gov. Rick Perry remains opposed to any form of Medicaid expansion under federal health reform. “We haven’t been fully briefed on the details of [Williams’] plan but the governor will review any bill that makes it to his desk,” Allison Castle, a Perry spokeswoman, wrote in an email.

Original story: 

State Sen. Tommy Williams, R-The Woodlands, is crafting a Medicaid reform plan that would use premium tax revenue to subsidize private health plans for uninsured Texans, his office confirmed on Tuesday night. 

Gary Scharrer, a spokesman for Williams, said the proposal is "still a concept," one that is designed to "buy some time" as Texas debates how to overhaul Medicaid in the midst of pressure from the federal government to embrace elements of the Affordable Care Act, or "Obamacare."

According to early details, Williams' plan would scrape premium tax revenue from newly insured Texans who sign up for coverage under the state's health insurance exchange — an online insurance marketplace that is mandatory under federal health reform — and use it to subsidize private coverage for poor, uninsured Texans starting in late 2015. 

Scharrer cautioned that Williams' proposal does not call for expanding Medicaid, which the state's top Republican leaders adamantly oppose. Nor does it call for raising taxes; the premium tax revenue will be a side effect of more Texans being forced to buy insurance under the Affordable Care Act. 

Williams is "really emphatic that Texas will not extend or expand the current Medicaid system," Scharrer said. 

He said the proposal could "very easily be a bill" or could be tacked on to a Medicaid reform measure that has been filed by state Rep. John Zerwas, R-Simonton, in the House. 

"The bottom line is, he's trying to buy some time to see how the exchange works," Scharrer said. "If it works as proposed, it should generate premium tax revenue that can be used to subsidize private market plans for those who lack coverage."