Health Reform Facts: Texas

DEMOGRAPHY The Patient Protection and Affordable Care Act (ACA) was enacted on March 23, 2010. Successful implementation requires cooperation between key stakeholders, federal and state agencies, and reform advocacy organizations. Because the fifty states vary greatly, each state’s implementation process will be unique. In 2009, Texas had the second largest population in the United States, estimated to be 24,782,302. 1 Texas is also very diverse, which makes this state unique in many ways, including health care needs and presents a special challenge to those trying to implement health reform in the state. Percent of Population in Texas per Race / Ethnic Group 2



White (Non Hispanic)


Black Hispanic Other*


* Others include American Indian & Alaska Native, Asian, and Native Hawaiian and other Pacific Islanders.

TEXAS AND THE UNINSURED: HOW WILL THE AFFORDABLE CARE ACT HELP? While 81% of all Texans have health insurance, over 6.5 million individuals remain uninsured,3 including 11% of Arizona’s children 4 and 28% of the state’s working population.5 ACA is designed to address these concerns by providing affordable access to health insurance coverage to those individuals who would otherwise be unable to obtain coverage, and to extend current benefits and services provided by Medicaid (a federal and state funded public insurance program that provides health insurance coverage for low-income and disabled individuals and families). NEW BENEFITS OF ACA AND THEIR EFFECTS IN TEXAS Insurance Coverage ACA establishes new requirements for private health insurers in order to make health care plans more accessible to the public. These requirements include the following:  Effective Immediately: Plans must cover certain preventive health services, such as vaccines and screenings, without a co-pay.
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Health Care Facts: Texas National Coalition on Health Care

 Effective September 2010: o Insurers will not be allowed to drop any insured person because he/she gets sick or develops a chronic health condition. In addition, ACA allows individuals to renew health insurance coverage regardless of their health status. o Individuals up to the age of 26 can choose to be covered under their parents’ insurance plan.  Effective January 2014: o Under the “guaranteed issue” provision, an insurer must accept every employer and individual in the state that applies for coverage. o Insurers cannot exclude people from coverage if they have a pre-existing condition (e.g., asthma, diabetes, or any other long-term condition) or past illness. o All insurers will be required to offer a coverage package that offers essential benefits. Small Business Assistance Tax Credits for Individuals Effective Immediately: ACA makes tax credits available to qualifying small businesses to help them afford coverage for their employees. These tax credits could total up to 50% of a business’ health insurance premiums. In 2008, Texas had over 323,900 small employers,6 which represented over 72% of the state’s employers.7 Effective January 2014: ACA provides a tax credit to qualified individuals so that they may purchase health insurance through the exchanges. Qualification for the tax credit will be based on the individual’s household income and his/her number of dependents. A person who earns between 133% and 400% of the federal poverty level 8 may be eligible for individual tax credits. Effective January 2014: ACA requires that states create an insurance market “exchange” – a marketplace where people will be able to compare and shop for health insurance. This will make access to health plans easier and more efficient. U.S. citizens, legal immigrants, and small businesses will be able to purchase insurance through these exchanges. Effective July 2010: High-risk pools are designed to provide health insurance coverage to people who were previously uninsurable due to a pre-existing condition. Texas has its own program called Texas Health Insurance Pool. In 2008, this program covered 26,908 individuals in the State of Texas.9 Gov. Perry indicated to Health and Human Services (HHS) Secretary Kathleen Sebelius his interest to establish a new federally funded highrisk pool.10 Effective January 2014: ACA contains provisions that would create new eligibility requirements for Medicaid. For example, adults under the age of 65 earning less than 133% of the federal poverty level, may be eligible to apply regardless of whether they have children. It is estimated that approximately 1,798,314 Texans may be able eligible to join Medicaid. 11

Health Insurance Exchanges

High-Risk Insurance Pools

Expansion of Medicaid

Health Care Facts: Texas National Coalition on Health Care

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IMPLEMENTATION CHALLENGES IN TEXAS Successful implementation of ACA will require a joint effort among local, state, and federal agencies, as well as many non-governmental organizations. The State of Texas will face several challenges:  Budget 12 – The limited budget in Texas will be a real challenge for implementation, specifically when expansions for services are expected. In May 2010, the Texas Health and Human Services Commission reduced its budget by 23%. This reduction severally affects Medicaid and other health care delivery services in Texas.  Health Care Workforce – With the potential increase of Texas's insured population, it is important that primary care physicians and other necessary health care professionals are engaged in health care reform. ACA provides grants and loan forgiveness to health care professionals; this will help Texas ensure that it has an appropriate supply of doctors, nurses, social workers, and other professionals to cover the increased demand.  Diverse Population – Texas's diverse population presents a special challenge to those implementing ACA in the state. A key concern for Texas residents regarding their current health care system is access to care. Providers must be sensitive to the state’s language, economic, and cultural diversity. This means that access to care and the ability to understand one’s treatment should not be threatened by one’s ethnicity, language, culture, or economic status.

U.S. CENSUS BUREAU. STATE AND COUNTY QUICKFACTS (2010), available at (last accessed June 2010). These figures are from 2009. 2 Ibid. These figures are from 2008. 3 THE KAISER FAMILY FOUNDATION, Data Source: Urban Institute and Kaiser Commission on Medicaid and the Uninsured estimates based on the Census Bureau's March 2008 and 2009 Current Population Survey (CPS: Annual Social and Economic Supplements), available at (last accessed June 2010). 4 THE KAISER FAMILY FOUNDATION, Data Source: Urban Institute and Kaiser Commission on Medicaid and the Uninsured estimates based on the Census Bureau's March 2008 and 2009 Current Population Survey (CPS: Annual Social and Economic Supplements), available at (last accessed June 2010). 5 COVER THE UNINSURED, ROBERT WOOD JOHNSON FOUNDATION, U.S. UNINSURED WORKERS, available at (last accessed June 2010). These figures are from 2006-2007. 6 Small businesses include employers with fewer than 50 employees. 7 U.S. DEP’T OF HEALTH & HUMAN SVCS. MEDICAL EXPENDITURE PANEL SURVEY (2008), available at These figures are from 2008. 8 The federal poverty level for the 48 contiguous states is $10,830 for a single individual. ASSISTANT SEC'Y FOR PLANNING AND EVALUATION, U.S. DEP’T OF HEALTH & HUMAN SVCS. THE 2009 HHS POVERTY GUIDELINES (2010), available at (last accessed June 2010). 9 National Conference of State Legislatures, Coverage of High-Risk Uninsurables: State and Federal High-Risk Pools (May 27, 2010) available at (last accessed June 2010). 10 Ibid. 11 JOHN HOLAHAN & IRENE HEADEN, KAISER COMMISSION ON MEDICAID AND THE UNINSURED, MEDICAID COVERAGE AND SPENDING IN HEALTH REFORM: NATIONAL AND STATE-BY-STATE RESULTS FOR ADULTS AT OR BELOW 133% FPL 41 (2010), available at (last accessed June 2010). 12 TEXAS HEALTH AND HUMAN SERVICES COMMISSION, Summary FY2010-11 HHS General Revenue Reduction Options, (May 18, 2010), available at (last accessed June 2010).

Health Care Facts: Texas National Coalition on Health Care

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