Texas Budget Writers Hear Concerns Over Medicaid Therapy Cuts

Texas lawmakers on Thursday revisited the fate of a $150 million cut in state funding to Medicaid payments for disabled children’s therapy made in 2015 — though the outcome of that cut remains uncertain as a legal battle over its legitimacy remains before the Texas Supreme Court.

Republican lawmakers on the Senate Finance Committee, led by chair Sen. Jane Nelson, a Flower Mound Republican, reiterated their belief at Thursday’s hearing that the state needs to cut back on health care spending. But those lawmakers reassured concerned parents they wouldn’t cut medically necessary services.

Parents said they feared their children would suffer developmental setbacks without speech, physical and occupational therapies, and asked lawmakers to reverse the cuts. Therapy providers have threatened to close their businesses as a result of a 20 to 25 percent cut to their Medicaid revenue that the cuts are likely to pose, which they say could cause children to be denied services.

The debate echoed previous comments that have been made in court cases, at public hearings and in the news media as a legal dispute over the cuts has dragged on for more than a year. The Texas Supreme Court in July ruled the Texas Health and Human Services Commission could not slash its payments to therapy providers for their services until the court considers the legal dispute.

The executive commissioner of the Texas Health and Human Services Commission, Charles Smith, testified Thursday that his agency had nonetheless been able to implement about $58 million in cuts from state revenue — a little more than a third of what lawmakers ordered last year. Those savings have come from tweaks in state policies, such as a reduction in how much the state reimburses providers for transportation mileage.

The Health and Human Services Commission faces a $1.3 billion shortfall, Smith said, and the agency is about $1.1 billion in the red on its Medicaid bill.

Nelson said she wanted state health officials to save money by reducing wasteful and fraudulent spending in the system, but that preserving children’s access to care “is the most important thing to me.”

“Every child who is eligible under Medicaid to receive these services will continue to receive these services,” she said, echoing the testimony of a Texas Health and Human Services Commission official. 

Smith told Nelson that Texas Medicaid often pays more for therapy services than do private health insurance companies and other states’ Medicaid programs, suggesting that a reduction in payments would not cause a massive exodus of providers as some advocates have warned.

That did little to assuage concerned therapy providers and parents of children with disabilities, who testified that the budget cuts would harm medically fragile children. Lobbyists for in-home therapy providers have disputed Texas officials’ claims that their industry is overpaid by Medicaid compared to other payers.

Dena Dupuie, who adopted her daughter Brianna from the foster care system after she was shaken violently as a baby, said at a press conference earlier Thursday that even without the cuts fully implemented, Brianna's Texas Medicaid coverage had delayed speech therapy by more than seven weeks. The result, Dupuie said, was that her daughter's stutter returned and she had been bullied at school for it.

Mayra Reyes, whose two-year-old son Gerardo was born with severe brain conditions, including hydrocephalus, said additional Medicaid cuts threatened to harm families like hers. She said she had quit her job to take care of Gerardo, who with the help of therapy had amazed doctors by his progress in developing muscle strength and motor skills.

“I just wanted to tell the Legislature, ‘Really think about how much you’re going to hurt these kids,’” she said. “I invite the senators to come to our home.”

Read more of the Tribune's related coverage:

• After an appeals court in June threw out the legal case over the Medicaid cuts, Texas officials moved quickly to begin making cuts to the therapy program.
• In July, the Texas Supreme Court once again halted the payment cuts to therapy providers, which bought time for the families and therapy providers who have been fighting them for more than a year.