AUSTIN, Texas (AP) — Fully implementing the federal health care law and adding 2 million people to Medicaid would cost Texas $11 billion less than previously estimated, the state's health and human services commissioner said Thursday.
Tom Suehs said it would cost $15 billion to $16 billion over 10 years if Texas fully implemented the law. That's 42 percent less than his initial estimate of $26 billion to $27 billion to expand Medicaid to include poor single adults and more children.
A study by the federal, nonpartisan Congressional Budget Office has estimated that the additional cost for Medicaid expansion is 2.8 percent more than what an individual state would normally spend on the program.
Suehs provided the updated estimate to the state Legislature after Republican Gov. Rick Perry on Monday told federal officials he will reject any attempt to expand Medicaid in Texas. The governor has the power to veto bills and the GOP-controlled Legislature is unlikely to challenge his decision.
"Medicaid spending already consumes more than 20 percent of our budget. It is an unsustainable, budget-busting program," Perry spokeswoman Catherine Frazier said Thursday.
Suehs cautioned that a recent U.S. Supreme Court ruling on the Affordable Care Act is complex with differing interpretations that could lead to more cost-estimate revisions.
"This will get refined as we see the complexities of what we need to do," the soon-to-retire health commissioner told legislators.
The Supreme Court upheld most of the federal health care law, but ruled that the federal government cannot coerce states into expanding Medicaid, which is a joint federal-state health insurance program for the poor and disabled. Under the new law, the federal government would pay for most of the additional costs of expanding the number of people with health insurance, with the state share capped at 10 percent.
About 24 percent of Texans lack health insurance, Suehs said, the largest percentage of any state. A recent Gallup poll placed the number at 27 percent.
Suehs said expanding Medicaid would reduce the number of uninsured from nearly 5.9 million to 2.9 million. "Without Medicaid expansion, the uninsured would be back to 3.9 (million)," he said.
He agreed with Perry's stance that Medicaid should not be expanded. Suehs said the program needs to be improved before that happens.
Texas has one of the most restrictive Medicaid programs in the country, offering coverage only to the disabled, children and some parents. Last year, state legislators underfunded Medicaid by $4.8 billion. Suehs told lawmakers he will be asking them to make up that shortfall when they meet again in January.
State Rep. Dawnna Dukes, D-Austin, questioned the wisdom of rejecting additional federal funds to help lower the number of Texas residents who are uninsured. Currently, the health care of those without insurance is covered by county taxes when those people go to the emergency room instead of a regular doctor, Dukes said.
"It doesn't seem to me to be penny-wise that when the reimbursement rates could go up and so many more people who are part of the uninsured population ... could be covered that some people won't even consider this expansion," Dukes said.
Suehs said it's up to lawmakers to decide who will pay to cover those uninsured people: counties, Medicaid or private insurance.
"I assure you Ms. Dukes that if (the federal government) would give me the four or five things I think are necessary to create accountability and flexibility in the Medicaid program, I'd go knock on the governor's door tomorrow and say, 'Let's change your position,'" Suehs said in response to the lawmaker's comments.
The federal Centers on Medicare and Medicaid do not allow states to create individual specifications for who is eligible or the best way to reimburse doctors, Suehs said.
"Some of the fixes are very simple and may be part of the negotiations with the federal government in the future," he said.
State figures breaks down the data on the uninsured in Texas this way: 36 percent are eligible for federally subsidized insurance under the Affordable Care Act, 14 percent are already eligible for Medicaid but not enrolled, 15 percent are ineligible because they are illegal immigrants and 11 percent can afford insurance, but choose not to buy it and will now be required to under the law.
Expanding Medicaid would reduce Texas' uninsured population by 24 percent.
"The big difference is the childless adult," Suehs said, in explaining who would be added.