Expanded Medicaid would improve Texans’ health. Here’s how it would boost economy, too

Texas Republicans’ resilience in November’s elections might seem to have answered the question of whether the state will finally expand Medicaid coverage under the Affordable Care Act.

Democrats made Medicaid expansion — spending some state money to draw a generous federal match and offer health insurance to poor adults — a pillar of their effort to win the state House. That push failed across the board, including a wipeout in Tarrant County. With Gov. Greg Abbott and Lt. Gov. Dan Patrick refusing to budge on the issue for years, it looks as tough as ever for a Medicaid proposal to get off the ground.

But there are signs that amid the state’s budget crunch, the spike in Texans without insurance because of the pandemic recession and a strong lobbying push from business groups, more Republicans in the Legislature may be open to the idea than in the past. We urge them to take the plunge.

Expansion comes with an enticing incentive: The federal government pays 90 percent of the cost. In other words, for every $1 the state spends on additional Medicaid coverage, it gets $9 from Washington. In any other context, this would be a no-brainer.

Texas is one of just 12 states left to resist expansion. On any other issue, our leaders would rage about sending our tax dollars to the federal government and not getting our share in return.

These arguments, unfortunately, haven’t taken hold. So perhaps, in a fiscal crunch, the benefit to the economy will.

And those benefits are vast. Texas would draw $5.4 billion in federal funds and add nearly a million adults to Medicaid. A recent study by The Perryman Group, a prominent Texas economic forecaster, recently projected that such coverage would be a boost across the board to the Texas economy — so much so that the state would actually generate more in tax revenue than it would cost for Texas’ portion of the expansion. Local governments would see more revenue, too.

Fort Worth has concentrated for years on building its medical sector. More coverage would mean more jobs and ease the burden on JPS Health Network in particular but on private hospitals, too, by reducing “uncompensated care” — in essence, when someone without insurance shows up and needs treatment. They can’t and shouldn’t be refused, but they have no prospect of paying the bill.

Instead, we all do, through our county taxes and the increased cost of treatment for everyone. Expansion will cushion that blow.

For years, one argument against a larger Medicaid program is that the feds planned to pull the plug, leaving states with the dilemma of adding an astronomical amount to their budgets or dropping coverage for millions. That’s no longer the case; the federal government is on the hook for 90 percent of the cost unless Congress changes the law.

It’s unlikely to happen anytime soon. And because most states must balance their budgets, legislatures are more adept at making difficult choices than Congress. Besides, this argument could apply to every federal program, and yet Texas accepts highway funding, education dollars and Medicaid.

At some point, the national debt, now more than $27 trillion, may require cuts to Medicaid and a whole lot more. But avoiding a useful investment because of some far off what-if no longer makes sense (if it ever did).

The benefits of expansion are clear, but still, Medicaid is far from a perfect program. Many health care providers decline to participate, given the low payment rates and administrative headache. Lawmakers need to consider innovative policy experiments to encourage better care through regular access to doctors and other care providers.

David Balat, a healthcare analyst with the conservative Texas Public Policy Foundation, pointed to one proposal to create a “direct primary care” model within Medicaid. The idea is to provide care through a regular monthly fee, rather than payments based on each service provided, he said.

Balat, a former hospital executive who leads the think tank’s Right on Healthcare project, says the idea is to turn the question of coverage around by making access to a doctor affordable.

“Access is a function of affordability,” he said. “Right now, the tail is wagging the dog on who’s making the decisions. … There’s no transparency, so we don’t know what prices are.”

For now, such a program would be a limited trial run, because recruiting doctors into such a model would take time.

Another problem with Medicaid is that, for various reasons, all those eligible for the current program don’t participate. Without enough doctors, some people have calculated that seeking necessary care through emergency rooms, rather than dealing with the headaches of enrolling in Medicaid and finding a provider, is better.

Figuring out ways to get more doctors involved, particularly by easing licensing rules for those who move to Texas from other states, would help, Balat said.

Health care innovation should be a priority in a state that consistently leads the nation in the number of people without health insurance. Start with the obvious step of Medicaid expansion. Then, clear a path for new models that give individuals and their doctors a stronger relationship and more control of their care.