As the legislature in Texas grapples with its budget, the Children's Hospital Association of Texas (CHAT), which represents seven, nonprofit hospitals, is warning lawmakers that cuts to Medicaid could have disastrous consequences for the children of the state.
More than 2.4 million children in the state are enrolled in Medicaid and more than 500,000 are in the Children's Health Insurance Program (CHIP).
Texas lawmakers have proposed budget cuts that include a 10 percent reduction in payments to doctors and hospitals for treating children covered by Medicaid and CHIP.
[See: Texas state budget proposes deep Medicaid cuts]
Without the benefit of a federal stimulus fund, Medicaid is short $9.9 billion. The state budget being proposed now calls for cost savings initiatives, but, said Bryan Sperry, president of CHAT, those cost saving measures, if they work, only reduce the shortfall by $2.7 billion.
"Children's hospitals are very dependent on Medicaid," Sperry said, "because they care for low-income [patients]. Between 50 and 80 percent of inpatients to children's hospitals are on Medicaid, so 10 percent can have a pretty major impact."
The state already faces a shortage of pediatricians, said Sperry, so if the state were to cut payments to doctors, the shortage could worsen, which could mean children and their families will have limited access to primary care physicians and specialists. Limited access to primary care physicians puts children in emergency rooms at a higher cost for care. Limited access to specialists means longer waits for patients and possibly, more health complications leading to increased healthcare costs.
"It becomes a compounding problem," Sperry said.
Cuts to payments to doctors would also make it harder to attract physicians to work in Texas, where the population grew by 20 percent in the last decade according to the 2010 census.
While the legislature works to come up with a budget, the children's hospitals are trying to come up with solutions to minimize healthcare budget cuts, said Sperry. Options being offered include the development of medical homes, getting matching federal funds, streamlining services to increase efficiency and using the state's Rainy Day Fund.
In a University of Texas/Texas Tribune poll released on Feb. 21, 87 percent of poll respondents said they oppose cuts to CHIP and 86 percent said they oppose cuts to Medicaid providers like doctors and hospitals.
"We recognize there will be cuts that will be made," Sperry said, "but we hope the legislature takes a smart approach. We have a lot of kids to take care of in this state."