The governor of Texas was angry about a health plan leader's demand that he expand Medicaid to low-income, uninsured adults under the Affordable Care Act because he hates Obamacare.
But behind the scenes, he and his aides were trying to convince the Obama administration to keep sending Texas billions of dollars in supplemental Medicaid funding to finance care for low-income, uninsured Texans—while continuing to insist he didn't want or need a Medicaid expansion that would extend coverage to more than 1 million Texans.
If that sounds like a contradiction, welcome to the continuing political battle over the ACA and Medicaid expansion that has hospitals caught squarely in the middle.
According e-mails obtained by the Texas Tribune, Republican Gov. Greg Abbott asked aides to investigate a health plan whose leader urged Medicaid expansion. Meanwhile, Abbott and his advisers were pursuing negotiations with the Obama administration about extending Texas' five-year Medicaid waiver program, which ends next September.
Under that waiver, the state draws $4 billion a year that's combined with state matching funds and split into two pools—one for uncompensated care and one to encourage providers to increase the quality and cost-effectiveness of care by creating innovative programs.
The Texas Tribune reported Monday that Abbott was miffed by a July 13 op-ed in the Houston Chronicle written by Ken Janda, CEO of Community Health Choice, a health plan affiliated with Harris Health System, a large public hospital in Houston. According to e-mails, Abbott told aides on July 15 that he wanted to see the financials of the not-for-profit plan because he heard “that most of these entities are rolling in dough.”
The episode is reminiscent of Florida Republican Gov. Rick Scott's political moves against Florida hospitals after they pushed unsuccessfully for enactment of Senate Republicans' Medicaid expansion bill, which Scott opposed. Following that legislative battle, Scott, a former hospital system CEO, backed legislation opposed by hospitals to eliminate certificate-of-need requirements and ordered audits of Medicaid plan payments to hospitals to determine if they were excessive.
Like Texas, Florida faced pressure from the Obama administration to expand Medicaid if it wanted to extend federal Medicaid supplement funding of more than $1 billion a year for its low-income pool that subsidizes hospital care to low-income, uninsured Floridians. Scott sued the administration claiming it was unlawfully coercing the state to accept Medicaid expansion. The administration eventually agreed to extend the Medicaid supplemental funding for two years at a reduced level. But Scott is continuing his probe of hospital finances.
In Texas, Janda had written a commentary urging the state to accept the ACA's Medicaid expansion to low-income adults, which Abbott and GOP legislative leaders have adamantly refused to do. “How can Texas continue to ask for billions of dollars in uncompensated-care payments to hospitals for uninsured patients coming to emergency rooms, when more than 1 million of those people could be put into Medicaid managed care?” he wrote.
“If we are smart, like other conservative states from Indiana to Ohio to Pennsylvania to Arizona to Utah,” he added, “we can easily negotiate an extension of the waiver to continue to provide the funds our safety net providers need for those not eligible for a Medicaid expansion, while providing the blessing of coordinated care through a flexible, cost-effective private coverage financed with federal dollars we Texans have already contributed.”
Abbott's policy director forwarded the governor's e-mail about Janda's commentary to other staffers, asking them to pull together information about Harris Health's finances. “By engaging in this ridiculous editorial, this specific hospital has now put themselves on the list” of facilities that should be reviewed financially, she wrote.
But about two weeks earlier, Abbott and his aides were strategizing about how they could replicate Florida's success in pressuring the Obama administration to extend Medicaid supplemental funding. “The governor wants to meet with Secretary (Sylvia Mathews) Burwell … to see if we can work out a deal on (uncompensated-care) funds,” wrote an Abbott adviser to the state's Medicaid director. He urged her to pull together Texas' “best pitches for getting a deal similar to or better than Florida's” and to develop “a litigation position to which I hope we will not have to resort.”
In a July 15 e-mail, an Abbott policy adviser acknowledged the vital importance of the extra Medicaid funding to healthcare in Texas. “Without supplemental payments, some private hospitals may eventually be forced to make the business decision to stop serving poor people,” she wrote. “This means the 'safety net' falls apart because there are not enough public hospitals in Texas to serve everyone.”
The Abbott administration, Janda and the Harris Health System declined to comment for the Texas Tribune article.
But Abbott, like Scott, has sent a warning to hospitals: They'll pay a political price if they continue to push for Medicaid expansion.
