Legislative Updates

 

Covid 19 and impacts on Health Insurance

The pandemic’s next blow: Over 1 million Texans will lose health insurance 
Half who lose their jobs and employer health plans are expected to go without coverage — far worse than the rest of the U.S.
By Mitchell Schnurman, Dallas Morning News  6:00 AM on May 17, 2020
The worst is about to get worse.

In Texas, where 5 million people already go without health insurance, nearly 1.2 million more are projected to join their ranks — far more than any other state.

That’s the estimated collateral damage from the coronavirus recession, assuming the national unemployment rate hits 20%, according to a recent Urban Institute report. Some believe the real jobless number for April may already be that high.
In that scenario, 25 million adults and children in the U.S. are expected to lose employer-sponsored health insurance. The vast majority — 7 in 10 nationwide — will get coverage elsewhere, the study estimated.

But in Texas, just 1 in 2 are projected to be covered, which would be the lowest share among the states.

The surge in uninsured arrives while COVID-19 is still raging and states are struggling to restart their economies safely. Laid-off workers who lose health insurance generally have a 60-day window to sign up for replacement coverage, usually through their company plan or the federal health exchange.

It’s a complicated decision that can be expensive, and unemployed Texans have a weak record of enrolling in such backup plans. That’s why the report projects such a low take-up in the state.

Losing insurance will greatly compound the health and financial challenges for people, hospitals, doctors and the broader economy.

“It’s devastating for the families that won’t be able to get the care they need,” said Vivian Ho, a Rice University economist who specializes in health issues. “Many are gonna try to tough it out on their own, and they could get really ill.”
It’s also devastating for health providers, she said. Their patient volumes have declined sharply amid coronavirus fears, and they’ve had to ramp up spending on supplies and preparation for COVID-19 cases.

“Providers are already running in the red,” Ho said. “This is gonna turn it blood red.”
Even before the pandemic, hospitals were struggling with a large number of uninsured and underinsured patients in the state, said John Hawkins, senior vice president for the Texas Hospital Association. Facilities in Texas provide billions in uncompensated care, and he said the costs are generally passed on to commercial customers and taxpayers in hospital districts.

Adding more uninsured now will amplify the strain.

“It’s huge,” Hawkins said. “It has a fiscal impact and a quality-of-life impact.”

Every state will see an increase in uninsured, the study shows. But Texas stands apart in both the total number to be added and the share of workers projected to end up without coverage.
Why so bad? It’s no coincidence.

For years, Texas’ statewide elected leaders have rejected efforts to improve access to care. They turned down Medicaid expansion time and again, and resisted programs to help people enroll in the federal marketplace. Texas is leading the legal challenge to overthrow the Affordable Care Act, a case headed to the U.S. Supreme Court.

Thirty-six other states, including some led by Republican governors and legislatures, have expanded Medicaid, a key plank of the ACA. The federal government pays 90% of those costs, and expanding Medicaid would cover nearly 1.6 million working poor in Texas — that was the figure before the pandemic led to millions of layoffs and furloughs.

In Texas’ existing Medicaid program, the state sets the lowest income threshold in the country. If a single mom with two kids earns more than $3,800 a year — or $317 a month — she makes too much to get Medicaid coverage in Texas, said one expert.

“We have the stingiest eligibility in the country,” said Stacey Pogue, a senior policy analyst at the Center for Public Policy Priorities in Austin.
The income cap in Texas is 17% of the federal poverty level for a family of three, which is lower than in Alabama and Mississippi, said the Kaiser Family Foundation. The average income cutoff for the U.S. is 138% of poverty level, which is generally the level in states that expanded Medicaid.

In those states, over half of the people losing employer insurance will get Medicaid coverage.

“This is the purpose of the Medicaid program, to provide a safety net to people in financial distress,” wrote Bowen Garrett and Anuj Gangopadhyaya of the Urban Institute’s Health Policy Center.

Texas lags in another metric: Just 23% of those eligible for a marketplace plan enrolled in an ACA option. That’s lower than in the U.S. (32%) and far lower than in Florida (47%) — even though Florida has a Republican governor and hasn’t expanded Medicaid, either.

“In Texas, maybe there’s less of a culture of coverage,” said Katherine Hempstead, a senior policy adviser at the Robert Wood Johnson Foundation, which helped support the Urban Institute report.
That could be related to the type of households, family income, immigration status and other factors. All that’s in addition to public policies from lawmakers, along with ideology and politics.

She believes the dynamic could change, perhaps with the new wave of workers who lose health plans during the pandemic. They’re accustomed to having coverage and may prioritize it more highly than the uninsured in the past.

They could pressure elected leaders to expand Medicaid and push for other ways to help residents navigate the marketplace. Such efforts are underway in other states.

“Sometimes a catastrophe can reshape what’s considered normal — and who’s considered to be deserving,” Hempstead said. “This experience could normalize other kinds of health coverage. There’s so much financial strain right now, and Texas is passing on a huge source of federal money.”

For years, Texas hospitals have fallen short in pushing for Medicaid expansion, which could be worth $100 billion in federal funding over a decade. The picture has changed, Hawkins said, because of the coronavirus and the energy bust.

“These are extraordinary times,” he said, “and if there’s a federal tool we can use, we ought to figure out how to access it.”
Mitchell Schnurman, Business columnist. He covers a wide range of topics.
[email protected]   https://twitter.com/mitchschnurman 

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WHAT IS TAHU?
TAHU is the Texas Association of Health Underwriters. We have more than 1,400
members across the state who help people and employers of all sizes find the best
health insurance for their needs. Our clients range from individuals to mom-and-pop
small businesses to larger companies. For many of those companies, we effectively
serve as their Human Resources Department, especially when it comes to their health
insurance needs. Our assistance begins with researching the best plans for each
consumer, and continues all the way through assisting with claims when needed.
OUR GOALS
Texans desire a healthcare system that delivers world-class care and financial security.
This system should be accessible and affordable, and it should have a positive impact
on the nation's economy. Successful healthcare reform will maximize consumer choice,
restrain skyrocketing medical care costs and increase access to healthcare for more
Americans. TAHU has consistently supported positive reform that achieves the
objectives of affordability and accessibility.
ACCESS, CHOICE and AFFORDABILITY
TAHU's members believe these three pillars form the key to crafting a comprehensive
approach to meeting this challenge. The following issues are critical to maintaining a
responsible, accessible, and affordable healthcare system for all Americans:
VALUE OF AGENTS, BROKERS and CONSULTANTS
TAHU is dedicated to ensuring continued access to the crucial services of statelicensed health insurance agents, brokers
and consultants who work on a daily basis to help individuals and employers of all sizes purchase health insurance, use their
coverage effectively, and make sure they get the most out of the benefits they have
purchased. Consumers' need for help from a licensed professional will only increase
as the national health reform conversation continues to evolve and legal compliance
demands on employers and individuals increase.
CONTAINING HEAL THCARE COSTS
By far, the greatest access barrier to health insurance coverage in America today is cost. Constraining skyrocketing medical costs is
the most critical - and vexing -aspect of healthcare reform. The cost of healthcare delivery is the key driver in rising health insurance premiums
and it is putting the cost of health insurance coverage beyond the reach of many  Texans.
TRANSPARENCY
Healthcare is the last remaining consumer purchase where the customer rarely
knows the price of the service in advance and the provider often doesn't either. A
recent poll found that more than two-thirds of Texans who attempted to compare
health care prices before getting the care they needed were able to save money.
True transparency enables customers to comparison shop and choose the service
they need at the price they can afford. Consumers also need to be able to compare
quality metrics between providers to make an educated choice. TAHU supports
letting health plans share quality and price comparison information with consumers
and doctors in their networks.
END SURPRISE (OR BALANCE) BILLING
Surprise medical bills are #1 on Americans' list of health care cost problems - more
than insurance copays, deductibles, drug costs or premiums. Texas is at the heart of
this problem - more than one-third of emergency room visits result in a surprise or
balance bill after the patient is discharged, which is much higher than the national
average. TAHU supports ending surprise billing and requiring health plans and
providers to directly resolve these disputes without the consumer in the middle.
FOSTER COMPETITION AND FLEXIBILITY
Texas continues to have the highest uninsured rate in the country - most are low
income, working families. Section 1332 state innovation waivers (effectively an way
to carve out an exception to the ACA for Texas) are fantastic opportunities to pursue
innovative and localized solutions to improve access to care. The legislature can
authorize TDI to apply for these waivers and make healthcare more local, reduce
administrative hassles, lower cost and improve access for families and small
businesses. TAHU supports the creation of a robust, competitive health insurance
market with maximum private competition and consumer choice of affordable
options so Texans can take personal responsibility for their health care needs.

CONTACT TAHU: P.O. Box 266682 Houston, Texas 77207 713-645-1490  www.TAHU.org
TAHU REGISTERED LOBBYISTS:Shannon Meroney and Mike Meroney (512) 499-8880
www.MeroneyPublicAffairs.com

Legislative advertising paid for by the Texas Association of Health Underwriters (TAHU); Shannon Meroney of
Meroney Public Affairs, LLC; 1402 Nueces Street, Austin, Texas 78701. Government Code §305.027(e)

 Ron Buffum. AAHU Legislative Chair