Legislative Update:

Children’s Hospitals in Texas

What Will Happen to Our Children?

Children’s hospitals in Texas are voicing concern about the major across-the-board cuts to Medicaid in the state legislature’s budget proposals. These hospitals, which are members of the Children’s Hospital Association of Texas (CHAT), provide specialized care for the state’s most ill children.

The proposed cuts to Medicaid funding will harm the ability of children’s hospitals to provide clinical care, to train and recruit the specialized pediatric clinicians that children need, and to advance the quality of pediatric care through research and innovations in service delivery.

Below are the major Medicaid cuts to children’s hospitals in the proposed bill in which CHAT and its member hospitals are most concerned.
  • The bill cuts hospital reimbursement by 10 percent. Reducing Medicaid payments to well below the cost of providing care will undermine the ability of children’s hospitals to see any child who needs specialized pediatric care.
  • The bill proposes to cut reimbursement to physicians, dentists and other providers by 10 percent. There are too few pediatricians, pediatric subspecialists and dentists to serve the fast-growing child population in Texas. More physicians and dentists are not taking children covered by Medicaid or are reducing the number of Medicaid patients they will see because of low payment rates. Fewer doctors and dentists willing to see these children means children will wait longer to get care. These delays in diagnosis and treatment will shift more care for children to the emergency room and to an inpatient hospital setting.
  • The bill eliminates funding for the children’s hospital Upper Payment Limit (UPL) program which helps to fund hospital losses due to below-cost Medicaid outpatient reimbursement and unreimbursed Medicaid costs for physician residency training programs.

There are other cutbacks that will affect children’s hospitals and the children we serve, such as reimbursement cuts in the Children with Special Health Care Needs program at the Department of State Health Services and CHIP.

On behalf of children’s hospitals in Texas, CHAT has asked the Texas Legislature to:

  • Preserve funding for inpatient care at children’s hospitals to maintain the ability of children’s hospitals to care for all children, irrespective of how sick or injured or what insurance coverage a child has.
  • Restore funding for primary care and pediatric subspecialty services for children, including funding for outpatient children’s hospital services and reimbursement rates for doctors and dentists to protect access to care.
  • Continue the children’s hospital UPL program to help support the training in Texas of pediatricians that Texas needs and the comprehensive scope of services that children's hospitals offer.
  • Use the Economic Stabilization Fund to restore Medicaid funding for children in the 2012-2013 budget.


Medicaid in the News

The following news stories provide a more in-depth look at how cuts to Medicaid would affect children in Texas. 

“Cutting state's contributions to Medicaid program adds up to a heavier tax burden for Texans,” Houston Chronicle, March 15, 2011.

"Cutting Medicaid harder than issuing soundbites, senators learn,” Dallas Morning News, February 15, 2011.

“Poll: Texans don’t want to cut social services, public education,” San Antonio Express-News, January 9, 2011.

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