December 2, 2023

Health Insurance

Follow Your Health Insurance

500,000 Texans and counting have lost Medicaid coverage

Five hundred thousand people.

That’s more than six times the capacity of AT&T Stadium, where the Dallas Cowboys play.

It’s far greater than the population of Corpus Christi.

It’s roughly the number of people who have lost Medicaid coverage in Texas since April, largely for procedural reasons. For each person now lacking health insurance, a potential crisis looms.

How did we get here?

During the height of the COVID-19 pandemic, federal regulations prevented states from removing people from Medicaid. But after three years, those federal pandemic protections came to a halt in April. States have, in turn, had to determine Medicaid eligibility. Since then Texas has removed around 500,000 people from Medicaid.

As Eleanor Klibanoff recently reported for the Texas Tribune, an initial review found about 95,000 people no longer meet the eligibility requirements for Medicaid, but another 400,000 were removed due to state bureaucratic loopholes, or “procedural reasons,” such as not responding to letters or emails from the state.

In other words, people were removed from Medicaid without the state determining eligibility. That is disturbing, especially since Texas could use third-party data, known as an ex parte process, to determine eligibility.

In a statement about this crisis, the policy nonprofit Texans Care for Children said, “Unfortunately, the Texas data show only 1% of renewals were completed through this process. By contrast, the majority of states are able to use the ex parte process to renew at least 25% of their renewals, and a quarter of states conduct over 50% of renewals through the ex parte process.”

Legislation was introduced in the Texas House this past session to streamline the ex parte process, but, unsurprisingly, it went nowhere in the Texas Senate.

The crisis has set off alarms.

Signing off as “Concerned Texans and Dedicated Employees,” staff from the Texas Health and Human Services Commission, or HHSC, the state agency that manages Medicaid for Texans, recently penned a letter claiming approximately 80,000 eligible people “lost coverage erroneously.”

Nearly half of all children in Texas younger than 19 are covered by Medicaid or CHIP, according to the nonprofit Every Texan.

The potential for coverage loss among children — let alone disabled people, and pregnant and postpartum women — due to bureaucratic red tape is untenable, tragic and an embarrassment. The reality is that when health care needs are ignored, problems fester and costs multiply. Just visit an ER.

“We’re deeply concerned that Texas kids who are still eligible for health insurance — either through Medicaid or another program — are losing their health coverage for bureaucratic reasons and are going to get turned away the next time they walk into a doctor’s appointment,” said Diana Forester, director of Health Policy at Texans Care for Children.

These numbers will worsen. The Texas Health and Human Services Commission will review eligibility for about 5.9 million Medicaid recipients. Rather than plow ahead, Texas should pause the Medicaid disenrollments and then reevaluate the 400,000 people who may have lost coverage for bureaucratic reasons.

Tiffany Young, HHSC spokesperson, told us the agency added staff and increased pay to bolster recruitment and retention efforts to reach clients regarding their renewal process.

But the onslaught of procedural denials signals a problem in the review process or workforce, or both. The agency clearly lacks support since state legislators only provided $111 million of the $143 million it requested to manage Medicaid renewals.

The decrease in health-related spending will take an economic toll. According to a Perryman Group analysis, the 500,000 Texans (and counting) who lost Medicaid coverage through July 28 will cost our state an estimated $13.6 billion in annual gross product and more than 121,200 jobs.

Texas has long had the dubious distinction of leading the nation in the percentage and number of people who are uninsured, but things were improving due to pandemic-era policies. A Georgetown University Center for Children and Families analysis in December found Texas had the worst uninsured rate in the U.S. for children in 2021, but the number of uninsured kids dropped — from 995,000 in 2019 to 930,000 in 2021 — thanks to Medicaid policies during the pandemic.

Now, Texas is once again falling behind.

Texas is one of 10 states to refuse to expand Medicaid under the Affordable Care Act, even though expansion has broad support among Texans and would bring in billions of federal dollars.

The disenrollment crisis again shows Texas has other intentions.

While there are federal requirements to conduct renewal determinations for all Medicaid recipients over a 12-month period, it’s imperative that HHSC’s process is fair. U.S. Health and Human Services Secretary Xavier Becerra has sent a letter to governors encouraging them to be strategic in retaining people on Medicaid.

Health care is a human right, and our state and country’s exorbitant health care costs can have calamitous effects. Texas should pause Medicaid disenrollments and take steps to ensure renewals for those who are eligible. It is the least the state could do.