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Big, Bad News: Rick Perry Refuses to Establish Health Insurance Exchange, Blocks Medicaid Expansion


by: Katherine Haenschen

Mon Jul 09, 2012 at 09:01 AM CDT


Governor Rick Perry, in a desperate attempt to remain relevant to the Republican party base and screw over his constituents at any cost, put out a statement today that he will a) not expand Medicaid coverage and b) refuses to establish a state-based insurance exchange. Perry joins a slew of constituent-loathing Red State governors with Presidential aspirations who are refusing to follow the state-level aspects of Obama's health insurance reform that would actually insure people.

In Texas, 24.7% of our residents are uninsured. We have the highest rate of uninsured residents of any state in the nation. Our uninsured Texans are depending on the Affordable Care Act's reforms to provide them with access to quality, affordable health care.

From the Texas Tribune:

Perry's office said he's sending a letter to U.S. Health and Human Services Secretary Kathleen Sebelius this morning asserting his opposition, both to accepting more than a hundred million federal dollars to put more poor Texas adults onto Medicaid, and to creating an Orbitz-style online insurance marketplace for consumers.

The U.S. Supreme Court has ruled that states - even Texas, which has the country's highest rate of the uninsured - may not be punished for opting out of the Medicaid. The insurance exchange is not optional; if Texas doesn't devise its own, the feds will establish a one-size-fits-all program for the state.  

"If anyone was in doubt, we in Texas have no intention to implement so-called state exchanges or to expand Medicaid under Obamacare," Perry said in a statement. "I will not be party to socializing healthcare and bankrupting my state in direct contradiction to our Constitution and our founding principles of limited government."

What does it all mean? Well, first off, it means Rick Perry wants uninsured Texans to continue suffering from needlessly preventable diseases and potentially losing their financial stability if not their lives due to lack of basic health insurance. More specifically, this is terrible news for Texans who don't have employer-based insurance and are low-income, but not destitute enough to qualify for Medicaid.

State-based exchanges: If states like ours don't set up a marketplace where Texans can shop around for the best coverage, the Feds will set one up for us. Though we don't know what the federal exchange will look like, one could reasonably argue that Texas's Republican legislature wouldn't exactly allow our state to set up an exchange that could function or succeed.

Loss of Medicaid dollars: This is the big one right here. This really sucks. As Edward Garris has written, Texas has the strictest rules to qualify for Medicaid, the state-funded insurance program for low-income residents. As Ed writes, to qualify for Medicaid in Texas, a person has to be on disability, pregnant, an infant, or extremely impoverished -- i.e. making no more than $188 per month as a family of three.

As the Center for Public Policy Priorities explains, Medicaid expansions were "estimated to bring $119 billion new federal dollars to the state, while Texas must put up about $6 billion from our state budget for its share of the Medicaid expansion." So by refusing to expand Medicaid, Perry is cutting our state off from $119 billion dollars in Federal money to provide coverage to low-income uninsured Texans.

SCOTUS paved way for Perry to opt out. In the 5-4 SCOTUS decision to uphold the Affordable Care Act, Chief Justice John Roberts sided with the liberals on the mandate, but with the conservatives in gutting the Commerce Clause portion of the bill. Specifically, SCOTUS ruled that states can't be penalized for not expanding Medicaid. That's what has enabled Red State governors to say "thanks, but no thanks" to providing more coverage of their lower-income residents who are poor, but not poor enough.

While the Affordable Care Act will still increase the number of insured Texans by between 2 and 2.5 million individuals, the roughly 1.8 million Texans who were eligible per HHSC guidelines to gain coverage through the Medicaid expansion now will not.

And it's not like it was going to cost our broke-ass state a lot of money: the Medicaid expansion was going to be 100% paid for through 2016, and then paid for 90-95% until 2020. This is cheap political posturing by Rick Perry -- he's scoring points on the backs of the working poor who would benefit most from the Medicaid expansion.

So, kudos to Rick Perry -- even though most of the Affordable Care Act was upheld, he's still found a way to screw over uninsured Texans and do his best to block them from getting access to affordable, quality healthcare. The fact that he's primarily screwing over low-income Texans must just be icing on the cake for our $10,000-a-month-rental-mansion-dwelling national embarrassment.  

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