Health care providers in Harris County could recoup most, if not all, of the uncompensated care costs incurred by the uninsured and paid by local taxpayers and charitable organizations if the state Legislature expands Medicaid under the federal Affordable Care Act, according to an analysis released by Methodist Healthcare Ministries of South Texas and the nonprofit Texas Impact.
Hospital districts, county health care services, jails and charities in Harris County spent $920 million providing services to the uninsured for which they were not reimbursed, according to 2011 figures. If the Texas Legislature approves Medicaid expansion, at least $645 million and as much as $1.4 billion in federal funding would reach Harris County in 2016 to provide services for many of the currently uninsured, depending on how state leaders would structure the expanded coverage, according to estimates.
Using data from hospitals, the census and current legislative proposals, the report also estimated increases to local tax revenue from expanding services to an additional one million adults, which in Harris County could be as high as $411.5 million over four years starting in 2014.
The report was compiled to highlight the burden uninsured Texans place on local health care systems and how an expansion of Medicaid would not only give many uninsured access to basic care, but free up local tax and charity dollars to further improve care or to fund other local priorities like schools and roads, said Bee Moorhead, executive director of the interfaith advocacy organization Texas Impact.
"Now we have a chance to use the federal income tax money that Texas is paying to help alleviate some of those costs," Moorhead said.
Elena Marks, a health policy expert at Rice University's Baker Institute for Public Policy, said federally funded Medicaid expansion is too good to pass up, citing a 2012 study by The Perryman Group titled, "Only One Rational Choice."
Rather than looking at the flow of federal, state and local tax dollars in health care, that study looked at the overall economic impact of reducing uncompensated care, enhanced productivity from healthier Texans and other multiplier effects. It concluded that every dollar spent by the state on Medicaid would return $1.29 in revenue over the first 10 years of the expansion.
Marks warns, however, that expanding Medicaid would not be enough, hoping that local funds freed by federal and state dollars could go toward improving care.
She points to a federal grant program operated through Regional Healthcare Partnerships that funds innovative improvements to providing primary care, serving at-risk populations and targeting particular diseases.
El Paso and Dallas counties have passed resolutions urging legislative approval, and a network of state non-profits, including Houston's The Metropolitan Organization, are encouraging others to follow suit.
"American taxpayers already have funded the increased health insurance coverage, but it's the governor's decision whether eligible Texans will be allowed access to it," said Kevin Collins, TMO co-chairman and a Catholic pastor, in a press release about a rally at the state capitol Wednesday. "Access to affordable, quality health care is a fundamental right for all."
Despite the projected savings and increased tax revenue for local governments, not everyone supports Medicaid expansion.
John Davidson, health policy analyst for the Texas Public Policy Foundation, doesn't dispute the findings of the Texas Impact study, but says Medicaid is not the right way to make sure people who need care receive it.
Call for reform
"The Affordable Care Act wants to create this class divide," Davidson said, adding that the proposed Medicaid expansion would shuffle people into a substandard care system rather than giving them care as good as those with private coverage.
He suggests, instead, reforming the existing state Medicaid program so patients receive the same quality of care in a cost-effective manner for the state and set up the currently uninsured population to access care via existing organizations or the new federal health care exchange.
"It's reckless to talk about expanding Medicaid without addressing the program's problems," Davidson said.
He also questioned the long term fiscal viability of a Medicaid expansion.
A 2010 study by Texas Public Policy Foundation went beyond the 2016 estimates of Texas Impact's report to 2020 and 2040, finding it likely that federal support for Medicaid would drop significantly, leaving the state to fund a much larger program that Davidson says will have become a new program entirely.
"That's why the Supreme Court ruled as it did," Davidson said. "You can call it Medicaid but it's not the same program states agreed to."