1.8 million Texans with Medicaid coverage could lose their current health plans and be shifted to new insurers if Texas Health and Human Services stands by a recent decision to redistribute the contracts.
Texas health officials are poised to drop the state's three largest nonprofit children's health plans from multibillion-dollar Medicaid and children's health insurance contracts - threatening the future of plans run by legacy children's hospitals in Fort Worth and South Texas, and shaking up health care coverage for low-income families throughout the state.Some 1.
The decision, which has not been finalized, comes from a new procurement process by Texas Health and Human Services that was put in place in 2021 after a long fight between the state and managed care organizations over how Texas chooses its Medicaid MCOs. It would also trigger a massive effort by the state to inform all those families of the change, which would take effect late next year if the plan holds.
Meanwhile, a handful of national for-profit chains would significantly expand their foothold in those markets - in one case growing from serving just one region of Texas to seven - while the others are either diminished or forced out. If the procurement is vacated, it would be the agency's third unsuccessful attempt to procure new contracts for STAR and CHIP managed care organizations.
"We're going to do everything we can to continue to serve those kids," Love said. "But it would be a financial challenge, no doubt about it. Cook Children's Health Care System is very strong financially. We've been here for more than 100 years. We'll probably be here for another 100 years. We are the provider of choice for families in North Texas and we'll continue to do that. But the MCO would be challenged to continue operations.
The April 3 letters demand that the decision be delayed and reconsidered - especially due to its impact on the Driscoll Health Plan and the roughly 180,000 STAR and CHIP members the plan serves in those lawmakers' districts. "It is important that the decision-making process acknowledges the significant contributions and expertise of DHP in addressing the healthcare needs of our region," the letter reads. "HHSC did not take into consideration our communities' needs and preferences, nor did it seek input from legislators, providers, or other stakeholders impacted by the decision."
"It's definitely a threat to the health plan," she said. "One of my greatest fears, if this procurement stands, is that all that work we've done over the last 18 years is down the tubes, and I don't see any other health plans coming in to do the type of work we've done," she said. "One size does not fit all. In South Texas, we have really low smoking rates and our pregnant population at very high diabetes rates," she said. "In East Texas, there is a much higher African American population, there is a much higher smoking rate. And so if I were running an East Texas plan, I would be tailoring programs to that population.
In Central Texas, home to Temple and Waco, 100% of recipients would lose their coverage if Baylor Scott & White, Wellpoint, and Superior get kicked out of that region. They would be replaced with BCBS, Aetna, and UnitedHealthcare Community Plan of Texas. Texas law allows three two-year renewals on the six-year Medicaid STAR and CHIP contracts, which are combined into a single service contract so that every MCO that gets a STAR contract also gets a CHIP contract. After the contracts have been in place for 12 years, HHS must run a new procurement.
In 2019, Abbott authorized Texas HHSC Medicaid and CHIP Services, at the agency's own request, to hire a third-party contractor to review the agency's procurement processes and report on how it could be improved.
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