Texas' Medicaid System Hurt Vulnerable People as Insurers Got Rich. Now Major Reforms Head to Gov. Abbott

AUSTIN – In 2016, a foster baby born with severe defects needed constant monitoring from a nurse, to ensure he didn't pull out his breathing tube and choke to death. The insurance company Texas pays to provide that care refused, saving Superior HealthPlan as much as $500 a day. Then the state's appeal system failed D'ashon, deferring to Superior. Months later, as D'ashon's nurses and foster mother warned would happen, the baby tugged out his breathing tube when his nurse wasn't around and suffocated for so long that he's now in a permanent "vegetative state."If bills that passed the Texas Legislature this week had been enacted then, D'ashon might have been saved. It's too late for D'ashon, but If Gov. Greg Abbott signs those fixes into law, thousands of other sick and disabled Texans might have a fighting chance when they're refused care by Medicaid companies that pocket more money when they spend less on care.Those measures were prompted by "Pain & Profit," a Dallas Morning News investigation that found widespread failures in Texas' privatized system known as Medicaid "managed care."The biggest patient protection that cleared both chambers is the creation of an independent arbiter to review cases when so-called managed care organizations, or MCOs, refuse to pay for doctor-ordered treatments and equipment. That "external medical reviewer" represents a potentially life-saving safety net for patients like D'ashon, who currently must exhaust appeals with MCOs, and then if they're determined enough, scale a faulty medical appeal system that heavily favors companies.Three key bills include other protections, such as more transparency and a bit more oversight -- not enough, patient advocates say – around the opaque and ever-changing rules companies cite as justifications when they deny services taxpayers have already paid for.While Texas and the federal government set broad guidelines, more than a dozen MCOs write their own rules for what is and isn't covered and which treatments require an additional obstacle to being approved. Positive, but not as tough as hopedAnne Dunkelberg, a health policy expert at the Center for Public Policy Priorities in Austin, called the package of bills "some really positive reforms" but lamented that in the final days of the legislative session, lawmakers scrapped the toughest provisions."Some major solutions were cut out of the final bills," she said, "like requiring (the state) to pull together and make public each insurer's track record of complaints, care denials, and how often they get over-ruled on appeals, so enrollees can use that information to pick a plan."She also said the bills are largely silent on more than 30,000 foster children, all of whom are in the charge of Superior, owned by Missouri-based Centene Corp.Texas and the federal government pay about $22 billion a year to companies and a few nonprofits that act as middlemen, deciding which doctor bills to pay and which services to approve. The state pays up front, and companies make billions in profit from what they don't spend on patients.In exchange, those companies promise to provide better and cheaper care by cutting costs for unnecessary services and connecting patients with doctors and specialists.Services deniedBut The News found years of inept state oversight allowed those companies to refuse or take away medically necessary services and force patients and families of sick and disabled children through a maze of endless appeals – sometimes with dire consequences. Those managed care companies vastly overstated how many doctors and specialists were available to their patients, The News found, and they routinely failed to meet the terms of their contracts.The investigation, which began with D'ashon's story, prompted more than a dozen bills. Only some of those fixes survived the legislative grinder and behind-the-scenes attacks from insurance lobbyists.The surviving measures will force the Texas Health and Human Services Commission, which has chronically failed to address failures in managed care, to spend more money and heighten its oversight. However, the bills come with one sticky, and potentially contradictory, proviso: the commission only has to enact reforms if lawmakers dole out money specifically for those efforts. While House budget writers added funding for the external medical reviewer, other pieces of the bills may have to be funded within the existing budget. The total price tag of the reform package is expected to exceed $7 million a year in state and federal money, according to legislative budget analysts.Medicaid cutsThat cost comes at the same time Senate budget writers, led by Sen. Jane Nelson, a Flower Mound Republican, are demanding $900 million in Medicaid cuts over the next two years. In other words, if the Medicaid program were a car, lawmakers are telling health officials to spend their allowance on new wheels, but pay the mortgage by scrapping whatever you can find under the hood."Those do seem to be in conflict," Dunkelberg said. "It's ambiguous."Sen. Charles Perry, a Lubbock Republican, authored two of the successful MCO reform bills, which critics have said do good things but are too narrowly focused on a few thousand chronically sick and disabled kids."Medically fragile children and their families will see much needed improvements to coordination of care through the passage of these bills," Perry said. "Families will now be able to spend more time caring for their child and less time navigating a complicated healthcare system.""There have been a lot of behind-the-scenes meetings to make sure our changes were going to have a real and immediate positive impact on these children," he said.Sen. Lois Kolkhorst, a Brenham Republican and chairwoman of the Senate Health and Human Services Committee, led the charge on the red-tape-cutting and complaint tracking measures that were tacked on as amendments to a House bill."I'm proud of the bipartisan work we did on this issue, especially the significant innovations for manage care that I added to the legislation to improve accountability and efficiencies," Kolkhorst said. "We made changes to the system that were truly needed to help our most fragile Texans and the families who care for them."  Continue reading...

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