Post-session Wrap-up: Health Care

As legislators took their seats for the opening of the 81^st Legislative Session, the potential for health care reforms aiding children and improving the way we regulate our private health insurance market was optimistically high. Despite the Comptrollers’ reports of an anticipated $9 billion budget shortfall, 15 billion in federal stimulus funds were en route from Washington; both chambers were sure to discuss and present amendments to the “must pass” Texas Department of Insurance Sunset Bill before re-commissioning the agency for 12 more years; and the Department of Insurance was preparing to file unique legislation, with broad support from stakeholders, to make health insurance more affordable for small businesses.

Some valuable reforms were achieved, but delays in the House associated with the election of a new Speaker, and time consuming partisan quarrels in both the House and the Senate over a bill requiring individuals to present identification before voting, postponed many reform opportunities till the next legislative session in two more years, or sooner, if the Governor calls a Special Session.

Children’s Health

CHIP

Arguably the largest upset of the 81st Session, the CHIP buy-in bill died waiting to be heard on the last day of the regular session. The bill, sponsored by Senator Averitt and Representative Coleman, would allow families between 200% and 300% of the federal poverty level to buy into the Children’s Health Insurance Program for a sliding scale fee directly proportional to family income. Averitt’s bill, SB 841, passed the Senate 29-2 but died along side hundreds of other bills as House Democrats stalled, or chubbed, the calendar to avoid a vote on voter id. Lawmakers made various attempts to save the legislation and children’s health advocates from across the state made 2000+ phone calls over the course of two weeks urging the Lt. Governor and and Speaker of the House to pass this legislation. Unfortunately, the bill did not have the 2/3 vote necessary to hear the bill out of order, and thus it died by the clock on the last day of session.

12 MONTH ELIGIBILITY

In 2007, the Legislature voted with bipartisan support to restore the CHIP renewal period from 6 months back to 12 months, as it stood before the legislature made massive cuts to CHIP in 2003. The 80th Legislature found that 12 month eligibility minimizes unnecessary drops in coverage for eligible children and removes unnecessary strain from the enrollment system. This session lawmakers tried to do the same thing for Children’s Medicaid, but failed due to partisan maneuverings and budget concerns.

Private Health Insurance

TEXAS DEPARTMENT OF INSURANCE

Over the 2007-2009 interim the Sunset Commission completed an extensive review of the statutory functions of the Department of Insurance and made recommendations to the Sunset Committee. Throughout the summer of 2008 members of the Sunset Committee met to hear public testimony and draft the Texas Department of Insurance sunset bill. Throughout the sunset process, Texas Impact supported efforts to equip the Department of Insurance with tools the agency could use make quality affordable health insurance accessible to more, if not all, Texans. Unlike departments of insurance in other states, the mission statement for TDI makes no mention of its responsibility to protect consumers. The TDI sunset bill included a new mission statement containing consumer friendly language. Like all sunset bills, the survival of the agency addressed in the bill is contingent upon the passage of the legislation.

SB 1007, sponsored by Senator Hegar and Representative Isett, passed the Senate but died in the House as representatives fought over the voter identification bill. Sunset bills for four other government agencies died in the House as well, prompting lawmakers to draft a ‘sunset safety net bill’ allowing government agencies to continue status quo for two years in the event that sunset legislation does not pass. The House passed the ‘safety net bill,’ but the Senate failed to do so before sine die. Unable to keep the agencies alive by executive order, the Governor will now have to call a special session forcing legislators to return to Austin to determine the fate of the Department of Insurance and four other agencies.

Not all, however, was lost or delayed. Three valuable pieces of health legislation passed this session and await signature from the Governor.

HIGH RISK POOL DISCOUNT PROGRAM

SB 2064 created a discount program for individuals eligible for the High Risk Pool. The High Risk Pool is the insurer of last resort for individuals with pre-existing conditions that exclude them from the private insurance market. Unfortunately, the premiums for the High Risk Pool have proven to be too expensive for most eligible individuals. This discount will provide premium assistance based upon income. The bill was sponsored by Senator Averitt and Representative Smithee.

COBRA CONTINUATION

SB 1771 extended the state COBRA continuation period from 6 months to 9 months allowing laid-off Texans to access the federal subsidies available in the economic recovery act to help individuals buy private health insurance while seeking new jobs. The bill was sponsored by Senator Duncan and Representative Eiland.

SMALL BUSINESS HEALTH INSURANCE REFORM AND SOLE PROPRIETOR COVERAGE

SB 78, among other things, created a state-operated insurance fund for health insurance companies to buy into, called reinsurance. With the reinsurance fund covering 80% of an individual’s health expenses between $5,000 and $75,000, insurance companies will be able to offer health plans to small businesses and their employees at a more affordable price.

SB 78 also includes provisions that allow the Texas Department of Insurance to assist single employee businesses in purchasing health insurance in a manner that may qualify them for the same federal tax breaks avaliable to small businesses with 2-50 employees.