April 19, 2005

Governor May Clash with Legislators
in Medicaid Fight with Family Twist

By Mike Hailey
Capitol Inside Editor

Despite hints of a possible veto and the state top health official's support for a competing proposal, the House Public Health Committee on Monday approved legislation that would establish an Integrated Care Management (ICM) pilot project in place of an expanded Star-Plus program that the governor's staff and the Health and Human Services Commission has favored.

Public Health Committee Chairwoman Dianne Delisi, whose son is married to Perry Chief of Staff Deirdre Delisi, has rounded up 127 co-sponsors for House Bill 1771, which would be designed to provide needed services to Medicaid recipients at a lower cost to the state. Delisi, a Temple Republican, had the bill recommitted to the Public Health Committee before having to return home due to the death of her mother, Arlene Barr White, who passed away Monday morning at age 85.

The Delisi bill's next stop is the Calendars Committee, which is chaired by one of its co-sponsors, Republican State Rep. Beverly Woolley of Houston.

The ICM model would require the HHSC to oversee the implementation of a pilot program in major urban areas where it had been planning to expand the Star-Plus program that's been operating in Houston on a pilot basis for the past eight years. The ICM program would be responsible for health care for welfare recipients, children, senior citizens, pregnant women and people who are blind and disabled while coordinating long-term care through an integrated care management system.

Health and Human Services Commissioner Albert Hawkins has pushed to expand the Star-Plus program instead of embracing the ICM that has attracted support from lawmakers quickly since Delisi proposed it as an alternative. With support from lobbyists for some HMO's, Hawkins has argued that an expansion of Star-Plus would be less risky and save the state five times more money than the ICM.

Perry has indicated that the Legislature should leave the final decision on the ICM system up to the HHSC's judgment instead of forcing the state agency to put it in place. The governor's deputy legislative director, Victoria Ford, has been leading the fight for Star-Plus behind the scenes - and according to key players on the issue - looking for other legislation that could be a vehicle for the managed care program if Delisi's alternative passes. Ford, who was the governor's health policy director before her promotion to her current post, has been representing Perry's office on a Medicaid reform work group that he created in November 2003.

Perry's former chief of staff, Mike Toomey, is a lobbyist for the Texas Association of Health Plans, an alliance of HMO's that has vigorously supported the Star-Plus expansion. The association's lobby team includes Barbara Maxwell, Leah Rummel, former Insurance Commissioner Tom Bond, former state House member Bill Siebert, Richard Evans and Karen Haywood.

But an overwhelming number of legislators have gravitated away from Star-Plus in favor of Delisi's proposal, siding with the Texas Medical Association, the Texas Hospital Association, the Texas Association for Home Health Care and other providers who have locked horns with HMO's on the high-stakes Medicaid overhaul. Star-Plus supporters suffered setbacks when the expansion was rejected by lawmakers on both the Senate Finance Committee and House Appropriations Committee. However, Star-Plus advocates are hoping that the potential for greater savings along with the threat of provider rate reductions without substantial Medicaid savings will prompt budget conferees to take another look at Star-Plus as more proven and more cost-effective option than ICM.

Seventy Republicans and 57 Democrats have signed on to Delisi's bill including a bipartisan group of co-sponsors: Republican State Reps. Fred Hill of Richardson and Vicki Truitt of Southlake and Democratic State Reps. Garnet Coleman of Houston and Jim McReynolds of Lufkin. State Rep. Vilma Luna, a Corpus Christi Democrat who will be the House's point person on health and human services on the state budget conference committee, is also a co-sponsor of HB 1771.