Right now all eyes are on the election, but insofar as the state legislature is concerned the outcome has already been determined. The republicans will maintain control of both chambers, and Governor Abbott will remain in office. The only question is the final seat count in both chambers. To that end, it’s time to start thinking about what bills can be enacted next session with a bipartisan coalition. Although the two parties hold differing ideological viewpoints on Medicaid, expanding HIPP should have bipartisan support for expansion.
The HIPP program
Expanding the HIPP program is a rare instance of where a social service expenditure is directly fiscally beneficial to the state. The HIPP program is a special program that becomes available when someone in the family has Medicaid. Information on the program can be found here. The short version is when an individual obtains Medicaid the state Health and Human Services department does a cost/benefit analysis regarding Medicaid payments.
How does the state benefit? Medicaid is the payor of last resort, so any insurance coverage pays before Medicaid pays. HIPP is a separate benefit application that the Medicaid recipient can file once they obtain Medicaid. With this application, Medicaid determines whether it’s more cost effective to provide care without insurance, or if it’s more cost effective for Medicaid to pay for the health insurance premium and the out of pocket limit. HHS then acts in the most cost effective manner. The state benefits because 1) HHS only reimburses if that’s the more cost effective route, and 2) they reimburse after proof of payment is sent to HHS.
Expansion would be beneficial to both the state as well as the recipients in two areas. First, the application is an affirmative act taken by the Medicaid recipient. Without the application the analysis never occurs. HHS should be directed to do the analysis for every Medicaid recipient in order to cut costs. A second area of expansion is enlarging the number of Medicaid recipients who are eligible to participate in the program.
In order to be eligible for HIPP participation the Medicaid recipient’s insurance can only be through an employer insurance program. If the Medicaid recipient has insurance through the marketplace they are ineligible. Since Medicaid is need based most recipients who have private insurance do so via the Obamacare tax credit. However, once the recipient obtains Medicaid they are no longer eligible for the tax credit. As a result, they are better off dropping private insurance and relying on Medicaid to provide coverage. Expanding eligibility to marketplace plans will keep more recipients insured and lower state expenditures.
We live in highly toxic political times. This not only holds true on a republican versus democrat scale, but also in regard to intraparty fighting. However, expanding HIPP is one of the rare actions that checks the ideological box for all sides. The fiscal conservatives see the state reduce overall expenditures. Social conservatives and democrats see social services expanded to provide additional care to those in need. Politics sometimes makes strange bedfellows. This is one area that a bipartisan coalition could be cobbled together to serve the interest of both the needy as well as the state.