Texas 2036 Report
Opportunity assumes access to and affordability of basic health care. Basic health care includes emergency services.
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Policy Pillars

Health

Pillar 03
Pillar 03

Texans are able to live healthy lives through an efficient and effective health system.

Focus

Physical and mental health directly affect our productivity and quality of life. The opportunity to enjoy good health is based on many factors, including access to and affordability of basic health care,
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Basic health care includes emergency services, hospitalization, outpatient care, laboratory and radiology services, prescription drugs, rehabilitative services and devices, pregnancy, maternity, and newborn care, and treatment of mental illness and/or substance abuse (including counseling), as well as preventative services (e.g. screening tests, immunizations, and pediatric oral and vision care). U.S. Centers for Medicare and Medicaid Services; National Prevention Strategy, Office of the Surgeon General, 2011 (https://www.hhs.gov/sites/default/files/disease-prevention.wellness-report.pdf).

as well as the quality of health services provided.

Because of rising health care costs and relatively poor health outcomes, good health remains one of Texas’ most profound challenges.

Health care costs in Texas continue to rise at unsustainable levels. Total per capita health care expenditures in Texas — including public and private spending — have risen an average of more than 4% annually over the last 10 years for which data is available
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Centers for Medicare and Medicaid Services, National Health Expenditure Data: Health Expenditures by State of Residence, 1991 to 2014. https://www.cms.gov/Research-Statistics-Data-and.Systems/Statistics-Trends-and-Reports/NationalHealthExpendData/NationalHealthAccountsStateHealthAccountsResidence.

, outstripping state population growth
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Texas Department of State Health Services, Texas Population Projection, 2014. https://www.dshs.state.tx.us/chs/popdat/ST2014.shtm.

and state GDP growth.
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U.S. Bureau of Economic Analysis, Gross Domestic Product by State, 2004 to 2014. https://apps.bea.gov/itable/iTable.cfm?ReqID=70&step=1#reqid=70&step=1&isuri=1.

Services for aging and disabled Texans also play a role: these costs already account for up to 25% of direct state health expenditures,
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Texas Comptroller of Public Accounts, Texas Health Care Spending Report, 2015. https://comptroller.texas.gov/about/media-center/news/2017/170131-health-care-spending.php.

and will continue to grow as the population ages. For many Texans – even those with insurance – increases in price have made care unaffordable;
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Kaiser Family Foundation, Texans Experiences with Health Care Affordability and Access, July 2018. http://files.kff.org/attachment/Report-Texans-Experiences-with-Health-Care-Affordability-and-Access

and for the 18% of Texans lacking insurance,
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U.S. Census Bureau, Health Insurance Coverage in the United States, 2018. https://www.census.gov/content/dam/Census/library/publications/2019/demo/p60-267.pdf

additional hurdles exist.
At the same time, health care access and outcomes for Texans remain poor. Measuring the ratio of providers to population, Texas ranks 45th in primary care providers and 49th in mental health care providers, with little change in the past decade.
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United Health Foundation, Americas Health Rankings, 2018. https://www.americashealthrankings.org/explore/annual/measure/PCP/state/TX

Texas continues to rank among the bottom half of states in key health-measures such as diabetes and obesity. Meanwhile, practices with a low cost but a high return, like child immunizations, are slow to gain traction. As a result, Texas is ranked tenth among 12 indentified Peer States for preventable deaths.

It is important for the Texas health ecosystem that patients and purchasers of health care be empowered to control the cost of health services, and that institutions have incentives to make high-value investments that will improve health outcomes.

Goal and Targets for Texas 2036
Goal #8 - Availability of Health Care: Texans have access to basic health care.
• Target: Texas ranks in the Top 3 among 12 Peer States for availability and regular use of health care providers.
• Baseline: Today, Texas is ranked last among Peer States in both categories.
Goal #9 - Affordability of Health Care: Texans are able to afford the basic health care they need.
• Target: Texas ranks in the Top 3 among Peer States for health care affordability.
• Baseline: Texas is ranked #11 among peer states for its high level of adults who could not see a doctor in the past year because of costs, and last among peer states in the rate of uninsured people.
Goal #10 - Population Health: Texans live long, healthy, and productive lives
• Target: Texas ranks in the Top 3 among Peer States for long-term health outcomes, including life expectancy and preventable deaths.
• Baseline: Life expectancy in Texas is currently comparable with the national average, but there are disparities in long-term health outcomes across population segments.
Goal #11 - Public Health: Texans and their communities are empowered to adopt healthy lifestyles.
• Target: Texas ranks in the top six among peer states in key public health metrics that impact long-term outcomes.
• Baseline: While Texas is middle of the pack on some public health outcomes, the state ranks last in obesity.
Goal #12 - Return on health care investment: Texas has a high-value health system that manages costs and delivers results.
• Target: Texas ranks in the Top 3 among Peer States for health system costs and value.
• Baseline: Texas is currently ranked tenth among peer states for health system value based on preventable hospital admissions and nineth among states in annual per-person health care expenditure growth.

Context

Public and private health care programs and service providers are all part of an interconnected care delivery system. This health care network includes hospitals, primary care practices, medical equipment manufacturers, long-term care providers, mental health care providers, and other health care providers (such as dentists and specialists). It also includes state agencies, health insurance companies, and prescription drug companies. Federal law influences the health system, in part through regulatory control over much of the private health insurance market and administration of federally funded programs like Medicare. The state's role in this health network is primarily that of administrator and regulator.

In 2014, total health care spending on the Texas health system — including both publicly and privately funded services — was approximately $190 billion, or about $14,000 per person.
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2014 is the last year for which CMS has published health expenditures. Centers for Medicare and Medicaid Services, National Health Expenditure Data: Health Expenditures by State of Residence, 1991 to 2014. https://www.cms.gov/Research-Statistics-Data-and.Systems/Statistics-Trends-and-Reports/NationalHealthExpendData/NationalHealthAccountsStateHealthAccountsResidence.

The state directly spent about $42 billion on health and human services in 2019; this accounts for over 40% of the overall state budget.
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Texas Comptroller of Public Accounts, Texas Health Care Spending Report, 2015. https://comptroller.texas.gov/about/media-center/news/2017/170131-health-care-spending.php.

Historically, roughly 50% of direct state health expenditures are subsidized by federal funds.
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Ibid.

The state funds and administers more than 200 health care programs and services, primarily through the Health and Human Services Commission (HHSC). The largest of these programs is Medicaid, which accounts for about 81% of the state’s direct health and human services expenditures. The Children’s Health Insurance Program (CHIP) accounts for only about .5% of the state’s direct health and human services expenditures.
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Health and Human Services Commission, Medicaid Overview Presentation to the Texas House Appropriations Committee, February 6, 2019. https://hhs.texas.gov/sites/default/files/documents/laws-regulations/reports-presentations/2019/leg-presentations/mcs-house-appropriations-feb-6-2019.pdf

Medicaid serves more than 4 million low-income Texas children, parents, or adults with disabilities.
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Medicaid uses the same qualification for disability as the Social Security Administration; adults with disabilities include individuals with medical conditions that significantly limit their ability to do basic work such as lifting, standing, walking, sitting, and remembering for at least 12 months. Texas Health and Human Services Commission, The Texas Medicaid and CHIP Reference Guide, 2018. https://hhs.texas.gov/services/health/medicaid-chip/about-medicaid-chip/reference-guide.

Almost all Medicaid enrollees receive coverage through health insurance companies that have contracts with the state, rather than from the state directly. CHIP is a joint federal and state program administered by HHSC for children whose parents make too much to qualify for Medicaid, but not enough to afford private insurance. Unlike Medicaid, CHIP operates similarly to private insurance in that program participants need to pay copays and premiums.
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Medicaid uses the same qualification for disability as the Social Security Administration; adults with disabilities include individuals with medical conditions that significantly limit their ability to do basic work such as lifting, standing, walking, sitting, and remembering for at least 12 months. Texas Health and Human Services Commission, The Texas Medicaid and CHIP Reference Guide, 2018. https://hhs.texas.gov/services/health/medicaid-chip/about-medicaid-chip/reference-guide.

As a regulator, the state oversees most providers in the health system, including doctors, nurses, pharmacists, dentists, home health providers, hospitals, nursing homes, and group homes for individuals with disabilities. The Texas Department of Insurance also regulates select health insurance plans to ensure fair competition in the industry and the fair treatment of patients.
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Texas Department of Insurance, About Us, 2020.