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Start of Abbott’s term has Texans wondering on possible Medicaid changes

For the first time in 14 years, a new official will sit in the Texas governor’s seat.
Greg Abbott will be sworn in Tuesday as the 48th governor of Texas, ending Rick Perry’s stint. Questions remain on how close or far Abbott will venture from Perry’s policies, and recent comments at a meeting of state lawmakers has focused attention on how Abbott may approach Texas Medicaid expansion.
Speculation on whether Abbott will be more in favor for Medicaid expansion than Gov. Rick Perry began after the Houston Chronicle reported Abbott inquired about Utah’s form of Medicaid expansion at a meeting in December.
At a press conference Friday, however, Abbott said he is not in favor of Medicaid expansion but is interested in Medicaid dollars in the form of block grants.
Michael Morrisey, health policy and management professor at the Texas A&M Health Science Center School of Public Health, said “block grant” is a catchphrase often used with alternative Medicaid expansion plans.
“The idea is that the federal government would give the state a block of money that they could use with a fair amount of discretion to restructure its Medicaid program,” Morrisey said. “I think the federal government is anxious to see states expand their Medicaid program and they are willing to negotiate.”
Jawad Dar, public service and administration graduate student at the Bush School of Government and Public Service and co-author of “The Takeaway,” a paper that argues government assistance programs like Medicaid, food stamps and home heating aid are poorly targeted, said Abbott has made his stance very clear.
“Abbott indicated earlier in October last year that he was not in favor of expanding Medicaid in Texas,” Dar said. “Abbott’s spokesperson, Amelia Chasse, has reiterated that Abbott will not be expanding Medicaid, despite hopes from Obamacare supporters after Abbott asked about Republican-governed Utah’s variation of the program.”
Dar said the choice to not expand Medicaid in its current form could result in the loss ofing billions of dollars.
“Opting out of Medicaid expansion would mean that Texas will lose out on an estimated $100 billion in federal funding to cover Medicaid expansion over the next 10 years,” Dar said. “In addition, an estimated 1.2 to 2 million uninsured individuals who could have otherwise obtained coverage will remain uninsured.”
There will be other repercussions as well, Dar said. Hospitals will continue to foot the bill for an estimated $5.5 billion in annual uncompensated costs, and Texas will remain on the list of states with the highest percentage of uninsured residents.
Lori Taylor, associate professor at the Bush School, director of the Robert A. Mosbacher Institute for Trade, Economics and Public Policy and co-author of “The Takeaway,” said another problem with Texas opting out is Texas taxes won’t go toward helping Texans.
“One of the problems you run into is that there are federal programs out there that will at least temporarily fund an expansion,” Taylor said. “And if Texas chooses not to expand, then … that results in our tax revenues being redistributed to other states. So there are downside risks to Texas to holding the line and not expanding the income eligibility for Medicaid, which is that our tax revenue gets redirected to other states.”
Taylor said there are some benefits to opting out as well since the current Medicaid expansion program is temporary.
With states like Utah and Arizona accepting Medicaid expansion under special alternative plans, Morrisey said many are hoping Abbott might do the same since he has said he is open to a block grant.
Laura Dague, assistant professor at the Bush School, said the reason states like Texas might be drawn to block grants is they tend to have more flexibility.
“States tend to be in favor of block grants because they would give them more flexibility, but again, you know, the federal government controls the broad credentials of the program and it’s unlikely they would just give a state the blank check, so it’s hard to say without knowing exactly how that would be implemented,” Dague said.

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