By Terence Stutz
Dallas Morning News
AUSTIN — Even as Texas leaders rail against the national health care law and call for its repeal, the state Department of Insurance has issued a report that says the law will make it easier for many Texas families to get health coverage.
The report also helps make the case that the current system is not working, as the number of Texans with health coverage through their employers has dropped nearly 18 percent in the last eight years.
In 2001, about 58.5 percent of Texans had employer coverage. By 2009, that figure had dropped to 48.2 percent — well below the national average.
“While most states have experienced declining rates of employer-sponsored coverage in recent years, the decline in Texas is more pronounced,” the agency said in a report to the Legislature on health insurance availability and affordability in the state.
The report noted that 26.1 percent of Texans are uninsured — 6.4 million residents — compared with a national average of 16.7 percent. Most are in families with low to moderate incomes.
Those are among the people who will benefit from the health care overhaul passed by Congress last year and signed into law by President Barack Obama.
The report is expected to contribute to the heated debate over the law in Texas, where Republicans led by Gov. Rick Perry and Lt. Gov. David Dewhurst have called for repeal while Democrats point to benefits for low and middle-income families.
Although the initial changes over the next three years will primarily affect those who already have health insurance — such as mandatory coverage of family dependents up to age 26 — others will see “dramatic changes” beginning in 2014, according to the report.
“Several federal requirements should significantly assist lower income families and employees obtain affordable health insurance,” the department said, citing the following:
•Tax credits will help families earning up to about $88,000 a year purchase affordable health insurance.
•Insurance plans must meet certain benefit requirements and cost-sharing provisions that limit out-of-pocket costs to enrollees.
•Most large employers will be required to offer health insurance benefits that meet minimum requirements or face penalty payments.
•Insurance plans can’t deny coverage based on an individual’s health status.
•Insurance plans can’t increase premiums based on an individual’s health status, age or gender.
•Insurance exchanges in the state will provide access to health insurance plans that meet standard benefit requirements for individuals and small businesses.
Legislation has already been filed in the Texas House to create a state-run health insurance exchange. That measure was filed by a key GOP health policy writer, Rep. John Zerwas of Katy.
“The removal of underwriting restrictions, new premium rating reforms, availability of subsidies and limitations on out-of-pocket expenses for low- and middle-income families should make it easier for many lower income Texans to obtain private insurance,” the report concluded.
It also noted that just 32 percent of employees in small businesses have health insurance, while 60 percent of those in large businesses have coverage. Some employees work for companies that have insurance but decline to take it because of cost or other factors.
One reason may be that average premium costs have doubled over the last decade despite programs and industry efforts to hold down costs. The average premium for family coverage in Texas in 2009 was $13,221. Contributing to the problem is that many employers have reduced their premium contributions as costs have jumped.
The report cited studies indicating that a family of four with an annual income of $44,000 pays out 15 percent of that total in health insurance premiums and out-of-pocket costs.
Just this week, Dewhurst said the state is “going to continue to fight Obamacare” along with a group of other states challenging the law in court.
“I have had problems from day one with Obamacare,” he said, adding that state health care officials calculate the law will cost Texas billions of dollars. Their estimate is an average $2.7 billion a year for the first decade after key provisions kick in in 2014 — an amount the Republican says the state cannot afford.
He argued that what is needed is more emphasis on reducing the cost of health care — such as incentives for doctors and hospitals that have good outcomes with patients — rather than so much focus on health insurance. He also said he is leaning against the state setting up its own insurance exchange, leaving that job to the federal government.