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As Texas Cuts Medicaid Costs, Some Recipients Lose Services

PHOTO: Texas this year ramped up its efforts to overhaul how Medicaid is administered.
PHOTO: Texas this year ramped up its efforts to overhaul how Medicaid is administered.
November 15, 2012

AUSTIN, Texas - Many Medicaid recipients in Texas have been noticing big changes in the program this year. The state is moving away from a traditional fee-for-services approach in favor of managed care. The idea is to save money, reduce fraud and better coordinate services.

The results, so far, have been a mixed bag, according to advocates for those who rely on Medicaid: the disabled, the poor, the elderly and children.

On the plus side, Dennis Borel, executive director of The Coalition for Texans with Disabilities, says many Texans in underserved areas are finding that health-maintenance organizations – HMOs – can speed up care.

"In the lower Rio Grande Valley, over 7,000 individuals who were waiting for services – those who qualify for a certain level of attendant care, who had been on a waiting list – now get services. That is pretty significant."

One big problem, he says, is that the new providers have too much leeway in cutting promised services after signing up new patients. Thousands of recipients fled one HMO in south Texas after the company cut certain services and reimbursement rates. In response, state Rep. Armando “Mando” Martinez, D-Weslaco, says he'll soon file a consumer-protection bill that would restrict providers from changing terms after signing up new customers.

Legal aid organizations have been fielding calls from Medicaid recipients navigating the new landscape. Trelisha Brown, an attorney who manages the Texas Legal Services Center's Health Law Program, says the state has scrimped too much on educating the public about the changes.

"When you are used to a certain system, and then all of a sudden there is a change, and there are promises made that everything is going to be exactly the same, and come to find out it's not, there's this learning curve."

She thinks coordination between providers in some ways has gotten worse. Beneficiaries, she says, used to be able to just show their Medicaid cards when they needed to see specialists or request supplies, equipment and testing. Her office now gets questions from patients who say the system is making them "jump through multiple hoops." The center provides free advice and assistance with accessing Medicaid benefits. Its website is TLSC.org and its health law hotline is 866-979-4343.

HMO cost-cutting is also impacting downstream businesses. For example, lower reimbursement rates reportedly have strained some pharmacies, and Dennis Borel fears home-care agencies will be forced to cut wages.

"What you're talking about is taking a very low-wage worker and cutting that wage. And if I'm an elderly person, and I need that individual to help me get out of bed, I'm real worried that that person's going to not show up because they can get paid more flipping hamburgers."

The Health and Human Services Commission has estimated the state will save more than $1 billion over the next two years, thanks to expanded managed care.

Peter Malof, Public News Service - TX