Texas and Health Reform

Texas Governor Rick Perry was a one of the more vocal Republican state representatives against health reform, though now the state has to make changes to its health care system. As a federal law, the Affordable Care Act requires every state, even Texas, to comply with its provisions. This means the lawmakers will have to make many decisions they may not like. Firstly, Perry has reported he will reject every possible aspect of the law he can, including a refusal to expand Medicaid in Texas because of the program’s increased cost to the state.

The Governor wrote HHS Secretary Sebelius a letter in July announcing this refusal, stating he was against health reform, as it would “make Texas an appendage of the federal government when it comes to health care.” However, every state is now forced to be an appendage, regardless of their participation in Medicaid expansion. The law will bring the federal government right in the middle of Texas health insurance, for one. In 2014, many federally mandated changes will occur, despite any opposition.

 

Texas Health Reform Changes 2010-Present

Some noticeable alterations have been made to Texas health insurance as a result of the ACA thus far, including making rescissions, the ability for an insurer to cancel a policy without good reason, illegal. This hasn’t made a huge dent in implementing health reform rules, as the majority enter in 2014. Also, Texas residents under age 19 with pre-existing conditions cannot be denied coverage by a private insurer, but they can be rated up. Many Texas young adults have taken advantage of staying on their parent’s health plans until age 26, which was newly introduced and made a great impact on reducing the amount of uninsured people in this age range.

The MLR provision of the ACA resulted in rebate checks to many insured residents of Texas this year, as well as lost jobs among health insurance agents. On a more positive note, the law gave people with insurance access to preventive care for no additional service charge with in-network providers. Insurers now cover 100 percent of routine exams, screenings, and other services deemed necessary for a patient’s demographic according to the Preventive Services Task Force. The Task Force also had several more of its proposed services approved for mandatory coverage, including birth control, which is surely one of the highlights of the law for Texans. Other newly approved services have not ruffled so many feathers, including prenatal care and mammograms.

 

Texas Health Reform in 2014

In 2014, health insurance will be controlled more by the government, though there will be benefits for some Texans. Individuals with pre-existing conditions will be able to purchase a health plan without discrimination, as will female residents throughout the state. Insurers in Texas will not be able to give sick, or formerly sick, applicants an elimination rider, or an exclusion period because of their medical history. If a plan member has a condition, it will be covered similarly to what the federal high-risk pool PCIP has been doing. Rates will also be limited, and can only increase by 10 percent if a person has a condition.

Not surprisingly, Gov. Perry also refuses to establish a state exchange for Texas, leaving the new avenue of private health insurance to the government. He has already notified the HHS, acknowledging his decision to not participate in setting up such an organization. This does not exempt Texas from having an exchange. The ACA states that if any state chooses to not set up their own, the federal government will establish one for them. This will occur in Texas, and will bring with it the choice for millions of Texans to buy a health plan from the government, through an impersonal website, for individual coverage rivaling that of Blue Cross Blue Shield, Aetna, and the others.

Also, this year will bring mandatory essential health benefits (EHBs) among health insurers in the private market. The state of Texas will be the one to decide which benefits are most essential, and they will be included in every health plan in the state. Plans must contain at least ten categories of coverage, the EHBs, which consists of maternity and newborn care, emergency services, prescriptions, laboratory services, and hospital care, among others.

Of course, one of the most important parts of the law is the individual mandate, which establishes that those who live in Texas and do not have health insurance are subject to a penalty, unless they have a waiver, or not enough income. Any creditable coverage applies to the individual mandate, such as Medicaid, Medicare, private health insurance plans, or group coverage. The penalties will be small at first, and increase over the years.

Subsidies will also be available, a tax credit for those who have trouble affording their premium costs. The federal government will issue these credits in order for people with low income, but not low enough for Medicaid, to purchase the most basic plan on the health insurance exchange.

 

 

Sources:

 

1. (24 Nov. 2012) Dallas News. “Texas Health Care Facing Big Changes, Tough Spending Decisions.” http://www.dallasnews.com/news/politics/state-politics/20121124-texas-health-care-facing-big-changes-tough-spending-decisions.ece