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How Children’s Health (and more) Fared in the 2005 Legislative SessionHouston Conference on ChildrenJune 15, 2005Anne Dunkelberg, Assistant Director (dunkelberg@cppp.org) Center for Public Policy Priorities www.cppp.org

Context for Funding Texas’ Health Care “System” • Latest US Census Bureau statistics show: • 24.6% of ALL Texans, and 26.9% of Texans under age 65, were uninsured in 2003 • That’s about 5.5 million Texans • Another 3 million covered by Medicaid or CHIP • Culprit: Texas has one of the lowest % of employer-sponsored insurance (along with Arkansas, Louisiana, Montana, New Mexico) • 9% below national average for under-65, at 52.4%, and 11.8% below national average for under-18.

Health Care for Poor & Low-Income Texans Medicaid: As of May 2005, 2.7 million Texans were enrolled in Medicaid: • 1.8 million were children • about 82,000 of these children, or 4.5%, were receiving disability-related Medicaid (97% of these on SSI) • about 13,000 were pregnant teens • 146,500 in TANF families (5.5% of total caseload) • 867,074 were adults: • 671,982 (77.5% of the adults) were elderly or disabled. Adults on SSI account for 60% of the aged and disabled recipients (76% of blind/disabled are on SSI) • Other adults: 93,800 maternity coverage; 39,400 TANF parents (1.5% of total caseload); 61,100 either TMA (Transitional Medicaid Assistance) or parents who are at or below TANF income, but not receiving TANF cash assistance Children’s Health Insurance Program (CHIP): • as of September 1, 2003 — 507,259 children • as of May 1, 2005 — 326,809 (drop of 180,450, or 36%)

Medicaid Cuts:What was Reversedby 2005 Legislature Restored (effective 9/05): • Adults’ Medicaid Services Restored: • Podiatrists • Eyeglasses and Hearing Aids • Mental health servicesby social workers, psychologists, licensed professional counselors, and licensed marriage and family therapists. There is some complication with the funding for this benefit, but at this time most believe that all 4 mental health providers will be restored. • STAY TUNED! Center for Public Policy Priorities www.cppp.org

Medicaid Cuts: What was Reversedby 2005 Legislature PROBABLY Restored: • The Personal Needs Allowanceof Medicaid nursing home residents (the monthly amount that Medicaid nursing home residents may keep from SSI, Social Security or other pension income; the rest goes to the nursing home) • was cut in 2003 from $60 to $45. • Though not restored by the budget or other bill, Gov. Perry has pledged to ask LBB for “budget execution” to allocate the $13 million in state dollars needed to restore this. • STAY TUNED! Center for Public Policy Priorities www.cppp.org

Medicaid Cuts: What was Reversedby 2005 Legislature POSSIBLY Restored: • Medically Needy Spend-Down Program for Parents (Temporary Coverage for Poor Families with Catastrophic Medical Bills) • HHSC estimated that full restoration of MN would cost $175 million GR for 2006-2007; SB1 authorizes just $35 million for “partial restoration” but assumes this will be funded entirely by voluntary contributions of local tax dollars (“IGT”) from the big urban hospital districts • Also says $20 million GR could be added to this IF the local funds are provided first (the $20 million would come from savings achieved due to the Women’s Health and Family Planning Waiver,more later on this) • STAY TUNED! Center for Public Policy Priorities www.cppp.org

Medicaid Cuts that Remain • Medicaid and CHIP provider rate cuts: • Most Medicaid and CHIP providers had rates cut in 2003: hospitals and doctors had a rate cut of 2.5%; nursing homes 1.75%, and community care providers 1.1%. • In August 2004, HHSC proposed and LBB approved keeping most the cuts at the same level for 2005 (i.e., not making deeper cuts); but hospitals took a deeper 5% cut. • 2005 legislature restores rates to 2003 levels for Community Care services and Waivers, and for ICF-MR (all at DADS), but not for doctors, other professionals, hospitals, or CHIP. • All other rate cuts remain. Rate cuts were the largest HHS cut made in 2003; much larger than the CHIP cuts. Center for Public Policy Priorities www.cppp.org

CommunityCare and Waiting Lists:funding for enrollment increases • 2003 Legislature reduced numbers and/or levels of services in capped Community Care and Health programs • SB 1 provides funds to increase a number of non-entitlement programs’ enrollment • For children: • MDCP increased from 977 in ’03, 983 in ’05, to 1,993 in 2007. • CSHCN increased from 1,463 in ’03, 2,114 in ’05, to 2,293 in ’07 • Most Medicaid waivers, HIV Meds increased • Exceptions: • CBA: was 30,279 in ’03; 26,100 in ’05; to 28,401 in ’07, • Kidney Health Program 22,834 in ’03; 21,247 in ’05; to 20,415 in ’07 • In-Home and Family Support for aged & disabled, MR still below ’03 levels (MH IHFS program eliminated in ’03 and not restored)

CHIP Cuts, 2004-05 Budget Summary of 2003 CHIP changes:* • Benefits eliminated: dental; vision (eyeglasses and exams); hospice; skilled nursing facilities; tobacco cessation; chiropractic services. Mental health coverage was reduced to about half of the coverage provided in 2003 • Premiums and co-payments increased • Coverage period reduced from 12 months to six • New coverage delayed for 90 days • Income deductions eliminated (gross income determines eligibility) • Asset test (limit) added for those above 150% of the poverty Line (took effect August 2004) • Outreach and marketing reduced *Underlined Items Restored by 2005 Legislature

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How CHIP Fared • Restored:Dental, vision, hospice and mental health benefits restored to 2003 levels • Funding to replace monthly premiums with more affordable and convenient enrollment fees. HHSC presentations have outlined an annual fee of: • No enrollment fee below 133% of the federal poverty level (FPL) (<$2,145/ family of 4) • $25 per family (per 6-month period) from 133-150% FPL ($2,145-$2,419/family of 4); • $35 per family (per 6-month period) from 151%-185% FPL ($2,420-$2,983/family of 4); and • $50 per family (per 6-month period) from 186%-200% FPL ($2,984-$3,225/family of 4)

How CHIP Fared None of the CHIP restoration bills ever had a public hearing, not even Senator Averitt’s SB 59. Restorations made were all done via the budget. • These 2003 Changes Remain: • Coverage period reduced from 12 months to six. Language in law now makes this permanent rather than planning for a return to 12 month coverage at a future date. • New coverage delayed for 90 days. (New perinatal coverage could eliminate this for many newborns.) • Income deductions eliminated (gross income determines eligibility). • Asset test (limit) added for those above 150% of the poverty line (took effect August 2004). • Outreach and marketing were reduced in 04-05, important to monitor and push for strong investment in both in 06-07.

CHIP Caseloads: Now and Projected Rider 57 HHSC (SB 1) requires agency to request addl. $ for CHIP from LBB if needed for enrollment and benefits.

New CHIP Perinatal Coverage Planned • Last-minute addition to the budget bill authorizes this (Rider 70 HHSC). No previous bill or public discussion, but agency has done significant lead work behind the scenes • HHSC assumes start-up 1/2006. The benefit and eligibility belong to the “perinate”, not the mother. Will provide prenatal care and delivery to women 186-200% FPL (who make too much for Medicaid) • ALSO will pick up mothers 0-200% FPL who donot qualify for Medicaid maternity coverage because they are either a legal immigrant or an undocumented resident. This means that many of the covered perinates would have been eligible for Medicaid at birth, i.e. all those with incomes below 185% FPL Center for Public Policy Priorities www.cppp.org

New CHIP Perinatal Coverage Planned • At some point before or at the first birthday, Medicaid-eligible children will be switched back to that program. • Of the nearly 48,000 perinates per month projected in FY 2007, over 39,000 are infants who would have been enrolled in Medicaid under current rules, and about 8,300 are perinates who would not have been covered without this option. • 7 states have these programs (AR, IL, MA, MN, MI, RI, WA); all but AR provided prenatal care to immigrants with state dollars before the CHIP program. • Controversy because (1) created under federal rule (not law) and (2) gives “person” status to the unborn. Center for Public Policy Priorities www.cppp.org

Other Major Health Care Changes on the Horizon • Universal Services Card, possible Medicaid Biometric Finger Imaging (SB 46 by Nelson) • Medicaid Managed Care Statewide Expansion • Women’s Health and Family Planning Medicaid Waiver • System Benefit Fund used to balance budget ($426.9 million), low-income electric subsidy gone; some used pay for Medicaid MH benefits ($34.6 million or 8%) • Integrated Eligibility Rollout • Medicaid and CHIP caseloads likely to exceed budgeted • Improved Standards and Oversight for Contracting & Privatization? • Any action re: THSteps Lawsuit? Center for Public Policy Priorities www.cppp.org

Texas Child Medicaid and CHIP Combined Enrollment(January 2002-May 2005) Source: All figures from Texas Health and Human Services Commission Center for Public Policy Priorities www.cppp.org

Ways to Be Informed and Involved • Go to www.cppp.org and subscribe to CPPP’s e-mail publication, the Policy Page. • Go to www.texaschip.org to get on Texas CHIP Coalition listserve • for National information about Congress, the President, Medicaid and CHIP: www.familiesusa.org • for more technical and detailed information about Congress, the President, Medicaid & CHIP: www.cbpp.org

Center for Public Policy Priorities www.cppp.org