THREE MEN ARE SITTING IN AT THE NEIGHBORHOOD BAR.

One of the men lives with his roommate in an old apartment building; he has no job but makes scattered amounts of income here and there, usually taking in about $200 a month, or $2,400 a year, which he always spends on food and alcohol.

The second man lives with his girlfriend in a trailer park, where rent costs about $300 a month. Both work full-time at minimum wage-paying jobs. He works in a fast food restaurant and she works in a daycare. Together, they have a gross income of around $21,000. They struggle to live paycheck to paycheck, and each is thinking about getting a second job to help make ends meet.

The third man has managed to keep up a part-time job, year round, lifting boxes for a shipping company. He makes $10 an hour, works three hours a day, six days a week, and sleeps at the local homeless shelter. His yearly income is $9,360.

The three men leave the bar in different directions, but end up in the same place.

Man number one goes home and steals his roommate’s food and then accidentally falls down the stairs and somehow breaks his leg. His roommate drives him to the emergency room for pain medicine.

Man number two goes home and gets a stomach virus, must have been from the food that afternoon. He spends the majority of his night up sick, and when the vomiting won’t stop, he decides to go to the emergency room for some relief.

Man number three gets hit by a car while walking down the road. An ambulance comes rushing to the scene and takes him to the hospital, where doctors declare his condition is critical.

Now, which of these men are poor? Each considers himself poor, that’s for sure.

But which of these men should be considered medically indigent, and should be provided with health care at the public’s expense?

That’s the question at the heart of the debate over indigent health care, and the answer is, of course, complicated. Is indigent health care for the poorest of the poor? What about the working poor?

It’s one of the questions the Indigent Health Care Advisory Committee, re-created during the 2005 legislative session to come up with a solution that helps address inequities in indigent health care and the health care system, sought to answer.

The committee recently finished its legislative duties and submitted its recommendations to the Health and Human Services Commission, which in turn gave a final set of recommendations to legislators. With the 80th legislative session just months away and public school finance finally resolved for now, many county officials and health care leaders are wondering: Is this next year the big one for health care?

Indigent health care for who?

Prior to the advisory committee’s formation, a debate had formed that seemed to divide the urban areas from the suburban areas, the counties from their hospitals. It seems to be a debate between, or on, cents and sensibility.

Some wanted to keep the qualifications for receiving indigent health care roughly the same, at 21 percent of the federal poverty level or just slightly higher. They argued that the original purpose behind the Indigent Health Care and Treatment Act, which mandated that counties provide health care to their poor, was just to give coverage to the poorest of the poor as the payer of last resort. They say other insurance programs should be created or expanded to give insurance to the working poor, or those too poor to afford their own health care premiums.

Others would like to see indigent health care expanded to serve those earning 100 or 200 percent of the federal poverty level. Those people believe that the Indigent Health Care and Treatment Act has impacted some counties and areas disproportionately and that areas not spending the 8 percent of their general tax levy on indigent health care should be required to share the costs of those areas that are.

In the end, the advisory committee’s set of recommendations more closely matched the desires of the first group. The committee recommended that indigent care programs be expanded slightly to include those with an income at 25 percent of the federal poverty level, instead of 21 percent.

Other recommendations ended up being mostly conservative changes to the existing program as well, leaving those who were hoping for radical changes disappointed.

“I don’t think they go far enough to help either the urban counties or their rural counties. … Raising the poverty level to 25 percent from 21 percent poverty really doesn’t include many people that would really be in need of the kind of help we are talking about,” said Ron Anderson, CEO of Parkland Hospital, one of the largest health care providers in the state, where roughly half the patients are uninsured. “I frankly think that the recommendations are kind of same old same old, what we’ve dealt with for years.”

The hospital supported a controversial bill during the last legislative session, SB 230, which sought to raise the income level to 200 percent of the federal poverty level and help pay for the increase by mandating that counties hand over all of their 8 percent of their general tax levy to a regional fund, which would have theoretically drawn down matching federal dollars for indigent health care.

Many county officials balked at the idea, stating that tax payer dollars should be used to serve the county and be under county control. SB 230 died in committee without ever receiving a hearing, and its companion bill, HB 930, received the same fate. But Anderson isn’t relenting. He said he believes it’s time for counties to stop “protecting their own turf” and look at solutions that are best for the state, not just their local areas.

“If we don’t address this, then the Indigent Health Care and Treatment Act may as well be blown up,” he said. “It was a good bill until the 21 percent floor was put in, and the floor became a ceiling in many counties. The fact that there’s no real penalty if you don’t spend the money, then there is no real mandate.” But county officials say they are doing their part, and that the state has not given indigent health care enough funding to make the floor a floor.

While Anderson said that some of last year’s legislative attempts, such as SB 230, may have gone too far too fast, he hopes a similar bill passes this session that raises the definition of indigent. The legislation is similar to recommendations made in another report, Code Red: The Critical Condition of Health in Texas, written by a task force created by 10 different academic health institutions. That report, published in April 2006, recommended that indigent health care services be expanded to those living at

the federal poverty level.

“The Code Red document is just an incredibly fascinating body of work,” said committee member David Brown. “But the charge given to this advisory committee was a lot different than that.”

“I think the committee was very rational,” he said in October. “When this goes to the next step, which would be to formalize the proposals, I think there will be some traction there. I think there is a practicality there to make it work.”

Taylor County Commissioner Stan Egger, a member of the committee, said most counties are doing the job mandated by the indigent care act, and doing it well, and that an overhaul of the system was not necessary on a statewide level.

“Many of the counties’ indigent health care programs are working pretty well,” he said. “You can’t wreck all of those working programs just to fix the (uncompensated care costs in) metropolitan areas.”

Practical Advice

Among other obligations, the Indigent Health Care Advisory Committee was charged with creating a pilot program for regionalization of indigent health care and with looking at other possible changes to the act.

Committee members spent the next seven months hearing presentations on everything from health care access issues to the Code Red: The Critical Condition of Health in Texas report to the potential benefits of 3-share plans.

The committee was also given presentations on the types of information gathered by hospitals, indigent health care best practices and collaboration examples from around the state and Upper Payment Limit.

Hospital Funding

The committee also broke itself down into four voluntary work groups, each focusing on a different aspect of SB 44: regionalization; health care differences; allocation, county reporting and enforcement; and other. Members of the public were invited to participate in the work groups.

Along the way, a certain set of common beliefs became clear. At its first meeting, the idea of “regionalization” seemed to focus on the concept supported by Parkland Hospital, which has been suffering a funding crisis due to the large number of indigent and unsponsored patients it cares for everyday.

But that concept wasn’t supported, as members seemed to mostly share a belief that counties should be responsible for handling and spending their taxpayers dollars within the county. “I don’t think counties are going to give their money to anybody, and I don’t think they should,” said committee member Brown.

In its proposed recommendations, the advisory committee proposed a pilot regionalization program focusing on collaboration of resources between counties.

In order to participate in a regional program and get the additional state dollars, all indigent health care service providers – including county programs, public hospitals and hospital districts – in a given region must agree to participate in the effort. They must also agree to one standard definition of “indigent,” based on a person’s income level, and that definition must be more than the current 21 percent of the federal poverty level. They must also be willing to gather and measure outcome data, including the project’s return on investment.

Under the pilot program, cooperating counties would choose two additional services that could help toward decreasing the area’s indigent health care costs. Those services included:

• Operating a 24-hour call center to direct indigents and area residents toward the appropriate health care provider, as well as schedule doctor’s appointments and provide other services as needed;
• Care coordination to help decrease duplication of services and provide more effective treatment;
• Non-emergency transportation systems to help indigent patients make it to their medical appointments;
• Health information and education programs;
• Increased prescription drug benefits to cover more than three medications; and
• Return on investment programs, such as pooled purchasing cooperatives, disease-focused programs and other community-generated ideas, in which counties focus on quantitatively measuring their success based on variables such as improved health status of a certain population, disease expenditures, inpatient days and number of emergency room visits.

As incentive for participating in a regional program, the advisory committee recommended that the state match the county’s expenditures on the additional services or allow the county expenditures that go toward the additional programs to be included in the county’s 8 percent, or both. That way, a county spending taxpayer dollars on non-essential services in order to save money elsewhere could more quickly seek state assistance if it ends up spending more than 8 percent of its total general tax revenue.

It also recommended that the state pay for any technology infrastructure necessary to make such regional programs successful. Several committee members expressed concern that the recommendations would be adopted in policy but not in funding. Without the state funding, committee members admitted that there’s little incentive for counties to collaborate in most cases.

Brown, who runs Citizens Medical Center public hospital in Victoria, said he is worried that the recommendations will never come to fruition because of a lack of funding in the state budget.

“(Passing policies without funding their requirements) is certainly (the Legislature’s) practice, and it scares me that they would create an additional mandate on counties,” he said. “I think the state has to step up, and I think there has to be additional funding.”

TIHCA incoming chair Kelly Curry, from the Montgomery County Hospital District, attended several of the advisory committee meetings and said he thought it was important that the advisory committee recommended more state funding be added to indigent health care.

Other recommendations, he said, were hit and miss.

“I’m happy to see that they are asking all entities to step up their fraud prevention. All indigent health care programs should have rigorous fraud and abuse policies underway,” he said. “We do account searches, we do asset checks, we look for assets through an online system that they may not have disclosed to us, we look very hard for alternate resources, if they, if the client was not completely truthful in their application.” Taking those measures has saved his hospital district hundreds of thousands of dollars, he added.

“We have found numerous times when we have found that people have been less than truthful about their resources and income in the application process,” Curry said. “We found someone that had five pieces of property out on Lake Conroe, they had run up 60,000 worth of expenses, we found that out through a $5 search. That happens often.”

Bell County Indigent Health Care coordinator Rita Kelley, who is also chair of the Texas Indigent Health Care Association, said the recommendations as a whole would improve county indigent health care programs, but not impact them much financially.

“I think that they really didn’t do a lot that is going to change much of what we do at the county level,” she said.

Hospital districts, she said, may be more impacted by the recommendations.

“One of the recommendations was that hospital districts and public hospitals should be required to provide the same types of services as counties. I really think that’s a bigger issue than a lot of folks realize. Hospital districts and public hospitals all run their programs differently,” Kelley said. Making hospital districts provide the same services as counties may help the problem of indigents from one county having to seek care in another.

Curry, with the Montgomery County Hospital District, said he has no problem with making hospital districts follow the same guidelines as counties, but said he believes the advisory committee erred when it recommended that it have the same requirements as county-run programs but not the same assurances.

For example, he said current legislation caps a county’s liability per client at $30,000 per year (the committee recommended that that be hiked to $35,000 a year). Hospital districts, he said, have no liability cap, and the committee did not recommend there be one.

Advisory Committee Chair Donald Spies, the director of health initiatives in Dallas County, said he believes the committee’s reporting recommendation may be the most likely requirement to pass through the Legislature, since it doesn’t require any additional funds and collecting that missing data is a necessary step to fixing indigent health care and funding it properly.

Part of the recommendation is that counties who do not report their indigent health care expenses be reported to the Attorney General’s office. But some said that the lack of reporting isn’t the real issue – it’s what is – or is not – being done with the data once it is collected. Curry said he believes counties and other entities need to know that the state will do something with the data in order to spend the time on the reports.

Ultimately, though, it’s not what’s in the recommendations that matters, but what the Legislature will opt to do with them.

“I don’t expect that all the recommendations will pass,” said committee member Lynda Davis, who oversees Hardin County’s indigent health care program. “I hope the regionalization recommendation passes, that the compliance and enforcement recommendation passes. I would like to see the 21 to 25 pass and the $30,000 to $35,000 pass to help the people. I think they deserve that.”

Lawmakers, local leaders exploring old, new options for fixing health care / By Maria Sprow

THE BEGINNING OF THE 80TH LEGISLATIVE SESSION is just around the corner. In anticipation of the next session, Legislators and others have been working on interim charges, studying potential health care access and insurance solutions and implementing the changes in Medicaid that passed during the last session.

Now that public school financing has been put to bed, at least for a while, some are predicting more of a focus on health care. “I think that it will be one of the top three (issues of the session),” said State Rep. Dianne Delisi, who is chair of the House Public Health Committee. “For about the last 10 years, it’s been education, education, education. That’s going to be the beauty about the 80th legislative session.”

Left pending While last year’s legislative session did result in several Medicaid-type expansions, including greater access to women’s health services and a Medicaid buy-in program for working people with disabilities, several other health care-related measures were left pending, for better or for worse.

One of those measures was the controversial SB 230, proposed by Sen. Royce West, which requested that the federal poverty limit for indigent health care eligibility be increased from 21 percent to 200 percent and asked that county money go into a regional pool to gain federal matching dollars and then be redistributed. The Indigent Health Care Advisory Committee was created to look at both those issues – regionalization of the service and whether to increase the number of people eligible for service.

During an interim meeting for the Senate Finance Committee, Sen. Kyle Janek said he believes the issue of some counties reimbursing other counties for indigent health care services – one of the issues at the heart of the regionalization debate – must be addressed if other bills relating to indigent care funding are to make an impact.

“None of this is going to have a whole lot of impact in my view unless we address that responsibility of counties to reimburse where care is given outside their county. They either have an obligation or they don’t,” Janek said. “One of the enforcement mechanisms could be that, we say if one county owed another county money, and we collect a mixed drink beverage tax… at the comptroller’s office, before you remit that to (that) county, if it turns out that county owes Nueces County some money, we can just say, ‘Fine, we will send that money to Nueces County. If you won’t pay up, we’ll pay it for you.’ I think this all has to be taken up as one large measure, to beef up enforcement, decide once and for all where the responsibility lies, do we make counties pay other counties and other hospital districts when bills are generated.”

The bill Janek was addressing was House Bill 2345, which grew from an idea by Harris County Commissioner Sylvia Garcia. The bill would have added a .5 percent fee to international wire transfers, using the funds generated in any given county to help pay for that county’s indigent health care expenses.

That bill gained some support during the last session, but there were questions of whether it would be a constitutional fee and concerns over who the fee would most affect.

“For us, it’s really about funding. It’s just a question of finding more dollars to keep up with the demand,” Commissioner Garcia said. “Everything else already has a fee.”

The bill’s fiscal note estimated that the fee could have generated a total of $16 million for counties in 2007, all of which would have been spent on indigent health care. Other estimates, such as one from the analysis company Goldman Sachs, were higher, at about $24 million.

“It’s a solution for all counties in the state, a solution that will really help address some of the increased costs,” Garcia said.

Several legislators praised the bill during the last regular session, and Rep. Vilma Luna, who co-authored the bill, stated that whether the bill was successful then or not, the idea would most likely come back again. “This concept is being looked at very carefully all over the country, and probably even in Congress, so whether we do it here or it gets done somewhere else, I think it’s coming,” she told members of the House Appropriations Committee.

Rep. Luna has since left office, but the Senate Finance Committee spent part of their interim closer look at how much money the fees could generate on a county-by-county basis and whether there should first be a pilot program.

During the interim, Senate Finance Committee Vice-Chair Judith Zaffirini and those charged with doing research expressed concern that there were too many methods and loopholes for getting around the fee. “You have to look at, if you add a fee on to wire transmissions, that it appears that this business will go to other sources,” said Stephanie Newberg, deputy commissioner of the Texas Department of Banking, who testified on the bill during the interim. “People traveling across the border can take funds, we have licensed bus companies that will take your money in Texas and take it to Mexico for you for a fee. You can also send funds by mail, or stored value cards.”

But others testified they did not think the fee would have much of an impact on whether people wire money out-of-country.

“The fee is so minimal that folks aren’t going to change their habits. The average transaction is less than $300, so you are talking about a dollar, $1.50. And a gallon of gas costs more than that, to go somewhere else, or to cross the border,” said Richard Ramirez, vice president of Investment Banking for Goldman Sachs.

Several legislators seemed to express doubt that the funding source would raise enough money to really make a drop in the bucket. Parkland Hospital earns $347 million raised dollars in property taxes this year. The fee was estimated to generate about $4 million for Dallas County. “This is a fairly negligible effort,” Committee Chair Steve Ogden said during an interim hearing on the bill. “The impression in my mind is that your proposal would fund less than … (one percent) of the amount of money you’re spending on indigent health care.”

“There are other funding sources, but we need to maximize all of them, and we need to look at all of them,” answered Dallas County lobbyist Craig Pardue, who testified in support of the idea. “I am going to say that that’s 1 percent we do not have right now.”

The bill has also been criticized by the public and community leaders as largely impacting poor immigrant workers who are sending their earned wages to families in Mexico.

“We felt it was, on the face of it, basically taxing poor people to send money to poor people,” said Parkland Hospital CEO and President Ron Anderson, who would like to see the Legislature look for larger solutions, like creating a guest worker program that requires employers to help pay for education and health care.

Midway through the interim, Rep. Delisi predicted that the bill will not pass this session.

“I don’t think it’s going anywhere… I just don’t think that the votes are there,” Delisi said.

On the horizon

The advisory committee and legislators are not the only groups of people who have been looking at ways to improve indigent health care funding and access to health care in general.

At the county level, the Texas Indigent Health Care Association is currently looking at a way for interested county indigent health care programs to come together in a pooled purchasing program for pharmacy benefits management services, which TIHCA chair Rita Kelley said could reduce the amount of indigent health care funds that go toward pharmaceutical costs. Kelley oversees the Bell County indigent care program.

“I think it will help save money. I think small counties will especially benefit, because they could never attract one of these larger companies to provide these services for them at the rates that larger purchasers could get,” she said, adding that even if all counties share one contract with a benefits management company, local pharmacies can still benefit by working with that company.

But most of the focus around the state seems to be geared toward finding new ways to insure the working poor.

“The one thing that came up over and over was that the true concerns of people were the uninsured Texans, the working uninsured,” said Indigent Health Care Advisory Committee member Lynda Davis, who oversees Hardin County’s indigent health care program. “It’s the concern of everyone involved in every aspect of (health care).”

Currently, several areas of the state are attempting to decrease the number of working uninsured by implementing 3-share plans, in which a person’s premium costs for health insurance are split equally between the employee, employer and a third agency, usually the government.

The concept is fairly new and comes mostly from the Midwest, such as Muskegon, Mich. and is designed to benefit those owning and working for small businesses – a group that covers most of the working uninsured in Texas.

“When you look at our data, 83 percent of the businesses in Galveston County that we surveyed said they would be interested in participating in the 3-share. When you look at those businesses, almost all of them have under 20 employees,” said Barbara Breier, director of the Program to Eliminate Health Disparities at UTMB-Galveston.

The Galveston area has been working on implementing the program for the last two years. It has already filed a Section 1115(a) waiver with the Health and Human Services Commission to approve and help fund the plan through unspent State Children’s Health Insurance Program dollars. Section 1115 waivers can take money both from the state’s Medicaid and State Children’s Health Insurance programs and are for research and development programs and reform projects.

Breier said she believes the program will cost the government about $60 per month per employee for 3,000 employees, or a total of about $5 million over a 5-year period.

The plan ultimately reduces health insurance premiums for those employees from an average of $350 per month to about $180 per month. The HHSC recently submitted the Galveston County plan to the federal Center for Medicare and Medicaid Services, which is the agency ultimately authorized to approve the plan.

“It is one way of trying to address the uninsured,” Breier said. “We’ve got to try everything we can to reduce that rate of uninsurance. “I was really surprised at how strongly the business community felt about this program. Day care centers, car washes, plumbers, electricians, these are the backbones of our community. And you ask these business owners, are you willing to pay an extra $50-$60 a month to pay for health insurance for their employees, and the answer is yes,” she added. “The employees, the things that they said were that they wanted access to primary care, specialty care and hospitalization. They would tell stories over and over where they were scared to death that something was going to happen to them… they can’t sleep at night because of that concern, and they would say ’I need security, I need a piece of mind.’”

UTMB-Galveston spends about $119 million a year on unsponsored patients and Breier said helping 3,000 patients a year become covered individuals could help stretch the hospital’s dollars farther. “This is a population that has resources to contribute to their health care, but they don’t have access to a healthcare plan,” she said.

Other areas in Texas, including Dallas and Harris counties, have been looking at implementing 3-share plans as well, and Breier said one challenge for the Legislature coming up could be finding additional sources to help fund the plans as the desire to implement them spreads across the state.

“I have read a lot about this, find it very intriguing and I think it is a really interesting concept. Would this work if we looked at this approach as one of our solutions statewide?” Nelson asked members of the Health and Human Services Commission during a Sept. 19 hearing.

“Yes, I think it would,” answered Chris Traylor, the HHSC commissioner for Medicaid and CHIP. “I think you’ll see some initiatives and some proposals from us that would do that, and to look at other communities outside of Galveston to provide the same sort of 3-share program.

Obviously, the communities themselves would have to support such an option, but it is very much a possibility.”

“Well, as we have been narrowing down our short list for Medicaid reform packages, this is one of those issues that I think sounds really sounds – I don’t see a downside to it if there is a community buy-in,” responded Nelson.

Of course, 3-share plans are not the only new idea that the Legislature may be exploring during the next session.

The Health and Human Services Committee also heard testimony on what Medicaid reforms other states have made since the passage of the federally-mandated Deficit Reduction Act in 2005. Among other things, the act stiffens the requirements on states to weed out false claims and ensure that everyone on the program fits the eligibility criteria. It also gives states more options for creating cost-sharing and premiums for Medicaid recipients.

Donna Folkemer, group director for health at the National Conference of State Legislatures in Washington D.C., testified on the Medicaid reform and insurance trends that are taking place around the country. “What we are seeing this year, particularly as we think about Medicaid, is continued decline in employer-sponsored health coverage,” Folkemer said. “So we are seeing an interest by states …to preserve the number of the insured, to prevent the number of uninsured from increasing.”

She said state efforts have mostly focused on three different areas: using Medicaid to cover more uninsured residents; changes to the benefits packages being offered to different groups through Medicaid; and developing long-term support services.

Among other initiatives, Massachusetts, which is seeking universal health care coverage, is implementing a health insurance connector program, which would connect low-income individuals with different private insurance plans and allow them to choose the plan that best fits their needs.

Arkansas, New Mexico and Oklahoma are each starting programs to help pay employers who need help funding their employee’s health insurance coverage. Illinois recently expanded Medicaid to include all children in the state. Vermont started up a premium assistance program to help employees who have access to employer-sponsored coverage.

Florida, Kentucky, Idaho and West Virginia have started exploring tailored benefit packages for different groups, or varying the benefits in packages offered for children, the elderly and the general Medicaid population. “Part of their goal was to basically say we can create services that respond to the needs of particular groups,” Folkemer said.

Those states have also begun developing enhanced benefits accounts, in which individuals are rewarded for certain behaviors.

“So for example in Kentucky, the way theirs is set up, if an individual with a chronic disease stays in a disease management program and complies with the rules of the disease management program for a year, then they can get dental benefits and vision benefits. Otherwise, they don’t,” Folkemer said.

In addition, several nonprofit and government agencies have started a new focus on finding and promoting “best practice” health care programs from across the state. The Texas Health Policy Institute published a report on the different community-based health care access programs that are underway across the state. The report included information and contacts for programs in Bexar, Brazoria, Galveston, El Paso, Harris, Lubbock, Dallas and Montgomery counties, as well as several regional initiatives underway such as the Indigent Care Collaboration in Travis, Williamson and Hays counties and the East Texas Health Access Network in Jasper, Newton, Sabine, San Augustine and Tyler counties.

Some of the access programs focus on creating regional databases as a way to share client information and increase case management and care coordination services; setting up medical camps to provide screenings, immunizations, eye camps and dental care; and health education and preventative care.

The institute will make a health policy presentation to the Legislature Dec. 1 focusing on what the state could do to draw down more federal dollars and make health insurance more affordable for smaller businesses, said President and CEO Camille Miller, who said she is hopeful the next legislative session could lead to big health care changes in Texas.

“Public school finance has been addressed now, and we’ve known about this health care issue for a long time. I think this be a really top priority… there’s really been kind of a groundswell,” Miller said. “You realize what a huge problem access to health care is and the cost-shifting that occurs when uninsured people go to emergency rooms. Health insurance premiums have seen double-digit inflation for years.”

Among the institutes’ initiatives is creating a new focus on fighting juvenile obesity, she said, since juvenile obesity has such a long-term impact on those it affects and can lead to long-term and costly health care expenses.

“A lot of children in Texas are getting diseases that you normally don’t get until they are 40 or 50 years old,” Miller said.

Cents and Sensibility: Who’s poor and who’s going to pay – that’s the question / By Maria Sprow

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