Texas hospitals could lose billions of dollars under GOP health plan

Health care workers join Nancy Pelosi, the House Minority Leader, for a demonstration outside the Capitol in Washington, June 22, 2017. Senate Republicans took a major step Thursday toward repealing and replacing the Affordable Care Act, unveiling a bill that would make deep cuts to Medicaid and end the mandate that most Americans have health insurance. (Doug Mills/The New York Times) less Health care workers join Nancy Pelosi, the House Minority Leader, for a demonstration outside the Capitol in Washington, June 22, 2017. Senate Republicans took a major step Thursday toward repealing and ... more Photo: DOUG MILLS, STF Photo: DOUG MILLS, STF Image 1 of / 8 Caption Close Texas hospitals could lose billions of dollars under GOP health plan 1 / 8 Back to Gallery

Texas hospitals stand to lose billions under the Republican-backed health plan, as federal Medicaid dollars shrink, leading to a rise in uncompensated care, according to a new analysis by the Commonwealth Fund, a national health policy foundation.

The study looked only at the U.S. House plan passed last month. It has not yet examined the impact of the U.S. Senate's version unveiled late last week, which experts have predicted will bring even deeper cuts to Medicaid.

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In Texas, uncompensated costs in the state's 304 acute care hospitals could increase by 7 percent, rising to $38.4 billion over the next decade, the study found.

That compares with an estimated $35.8 billion over the next decade under the current Affordable Care Act.

At issue is a spike in the number of the nation's uninsured whose care is often absorbed by hospitals.

On Monday the Congressional Budget Office predicted 22 million more Americans will be uninsured by 2026 than under the current law-- with 15 million without coverage by next year under the Senate bill. That spike is expected because of reductions in Medicaid funding, and the recalculation of insurance plan structure and how people afford them, the report said.

That prediction is mostly consistent with how the CBO scored the House version last month which had estimated 23 million more would become uninsured in the next decade compared to the ACA.

The Senate had hoped to vote on the measure this week but on Tuesday leadership announced it would delay the action until after its July 4 recess.

Texas already leads the nation in the number of uninsured and hospital executives have cautioned that their institutions would be hard pressed to take a bigger hit should the uninsured rate go higher.

"If people think Harris Health can absorb this, that is a miscalculation," said George Masi, president and CEO of Harris Health System, in a January interview with the Chronicle.

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Harris Health is one of the nation's largest public hospital systems with more than 62 percent of its 330,000 patients across the systems already uninsured.

The Commonwealth study found that the biggest jolt to the nation's hospitals under the Republican's House plan will come in the 31 states that expanded Medicaid under Obamacare. Texas is one of 19 states that did not.

Those states could see an average increase of 78 percent in uncompensated care. One of the sharpest increases is in Kentucky, which could shoulder a 165 percent rise, the study found.

The CBO report on the Senate bill said it could save the the federal government $321 billion over a decade -- seen as a victory for supporters who say the nation needs to reign in spending. That compares with an estimated $119 billion under the House plan.

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Much of that will come in deep reductions to Medicaid, especially in expansion states. While Texas will not feel the brunt in the same way, the state could still lose as much as $1.5 billion per year over the next decade.

That will mean states will have to make up the differences one way or another. Those could come either through program cuts, stricter qualifying standards for Medicaid recipients or less money to providers, said study author Allen Dobson.

His study also showed that the reduction in Medicaid dollars will hurt rural hospitals, many of which are already struggling to stay afloat. In Texas' 110 rural hospitals, operating margins could weaken by a full percentage point over the next decade.

Dobson said it is not just Medicaid patients at those rural hospitals that stand to lose. "Everybody in the community is impacted," he said.

This story was updated Tuesday afternoon to reflect the decision to delay the vote and with information about the CBO report.