Medicaid Woes Subject of House Committee Hearing

At a Monday hearing on the implementation of Medicaid managed care in South Texas, lawmakers got a much bigger earful on the consequences of difficult budget decisions they made in the last legislative session.

In an effort to curb costs last session, lawmakers expanded Medicaid managed care, the health plan that oversees care for impoverished Texans, to South Texas, the border region and previously underserved areas. They made two other budget-saving moves: reducing state reimbursement rates to providers who care for "dual-eligible" patients — people who qualify for both Medicaid and Medicare — and crafting a health budget that did not account for Medicaid enrollment growth. 

Without major action from the state Legislature, these changes “will erode our state's safety net of care,” said Carlos Cardenas, a gastroenterologist who testified at the House Human Services Committee on behalf of the Texas Medical Association and the Texas Border Health Caucus.

Cardenas said physicians have more paperwork and lower reimbursement rates because of the expansion of managed care, and that many providers, particularly those who treat a large number of dual-eligible patients, have been forced to lay off staff and see fewer patients. In turn, more patients wind up in the emergency room with more serious illnesses, he said, because “not everybody can get in to see their primary care physician.”

Kyle Janek, the newly appointed commissioner of the Health and Human Services Commission, characterized the rollout of managed care as “a success, but a qualified one, because we realize there are challenges to overcome.”

Janek also told the committee that HHSC plans to request an emergency appropriation of $4.7 billion to cover Medicaid and other expenses in the current biennium when the Legislature reconvenes in January. “We were incompletely funded to keep the budget balanced in the last legislative session,” he said.

Janek said the managed care organizations contracted to handle Medicaid enrollees’ health benefits are meeting the Texas Department of Insurance’s qualifications for network adequacy and quality of care, but that HHSC is working to address complaints from providers. He said HHSC has decided to terminate its contract with one managed care organization, Delta Dental, and it is looking into “challenges” reported by providers with another managed care organization, Molina Healthcare.

Currently, health providers can only inform HHSC of delayed payments or issues with a managed care plan by submitting a complaint, said Rachel Hammon, executive director of the Texas Association of Home Care and Hospice. Because the complaint process is not anonymous, some providers fear — or have encountered — retaliation from managed care plans after submitting a complaint, she said.

“Why are we not asking the providers how it’s going in a survey process so you can actually trend that data?” she asked.

Joe Vesowate, deputy director of managed care for HHSC, said the department has to communicate the nature of a provider’s complaint to the managed care plan in order to address it, but that “I have not had specific examples of retaliation brought to my attention.” He said that if a managed care plan retaliated against a provider for complaining, HHSC could take disciplinary action, such as limiting patient enrollment or putting the managed care provider on a corrective action plan.

Rep. Richard Peña Raymond, D-Laredo and chairman of the committee, suggested holding an informal stakeholders meeting “to see if we can get some consensus, from the insurance companies, from the providers” on ways to improve the managed care system. If all parties can agree to certain changes, it may be quicker for the department to bypass the Legislature and make those changes on its own, he said.

Editor's Note: This story originally contained two inaccuracies, which have been corrected. Janek said the HHSC plans to request $4.7 billion, and it was a House Human Services Committee hearing.