A proposed change in Texas Medicaid would drop three-multibillion-dollar health plans run for 20 years by nonprofit hospitals.
About 1.8 million Texans who receive Medicaid coverage from six managed healthcare plans would lose current coverage and be shifted to new insurers if Texas Health and Human Services stands by a decision to redistribute the contracts after a competitive bidding process.
Changes would include a reduction in the number of managed care organizations that administer Texas’ Medicaid STAR and Children’s Health Insurance Program.
The decision, which has not been finalized, is the result of a new procurement process by Texas Health and Human Services that was put in place in 2021 after a long fight between the state and managed care organizations over how Texas chooses its Medicaid MCOs.
Medicaid STAR and CHIP programs cover the cost of routine, acute and emergency medical visits. STAR is primarily for pregnant women, low-income children and their caretakers. CHIP provides health care to lowincome children whose family’s income is too high for Medicaid, which has some of the lowest income limits in the country.
Their members compose the vast majority of more than 4 million Texans on state Medicaid programs.
The change would force nearly half of the Medicaid STAR and CHIP enrollees in the state out of their current health plan, potentially causing changes in providers, pharmacies, mental health services and plans.
Officials at HHS say there is no date set for when the decision may be finalized. Companies were advised to file their protests by late March. The agency declined to comment on the procurement.
The plans and the lawmakers want to see the state remove limits it has placed on the number of managed care organizations allowed to operate contracts in a particular region.
The potential change comes on the heels of a massive process in which the Texas HHS had to review the Medicaid and CHIP enrollment of some 6 million Texans after the state was forbidden from dropping anyone’s coverage during the pandemic.