The Texas 10 x 10 x 10: A Road Map for Achieving a Healthier Texas

Executive Summary

As the adage goes, everything’s bigger in Texas. With the fastest-growing population and gross domestic product in the United States, and home to the world’s largest medical center as well as leaders in energy, aerospace and technology, our state is an engine for economic opportunity. In many respects, it represents the present and future iteration of the American Dream. Yet while the opportunities may be bigger in Texas, so too are our state’s challenges, particularly with regard to the organization, financing and delivery of health care. Our state is one of extremes: a place where our medical facilities are pioneering care delivery, but our mothers are facing some of the highest maternal mortality rates in the country; a place where we lead in funding for translational research, but lag in support of our basic public health needs.

The COVID-19 pandemic has exposed and exacerbated the structural inadequacies in our state’s health care infrastructure, which include insurance gaps that deter Texans from seeking necessary treatment and an underlying burden of chronic disease that increases Texans’ risk of severe illness. As the public health emergency begins to wane, the state’s leaders should use the lessons, opportunities and momentum from the pandemic to chart a new course for investing in the health of Texas’ communities and residents.

This paper is intended to help lawmakers identify key priorities for the state’s health policy agenda for the next decade. Its goal is to provide recommendations on 10 issue areas that, if implemented, could help improve Texas’ health rankings by 10 spots over the next 10 years. Proposed policy priorities and levers, in no particular order, from the “Texas 10³” include:

1. Closing the health care coverage gap
2. Investing in public health infrastructure
3. Ending the women’s health crisis
4. Establishing a Children’s Cabinet
5. Increasing support for mental health
6. Expanding policies for tobacco control
7. Preparing for the health impacts of climate change
8. Reimagining long-term care
9. Addressing the upstream drivers of health
10. Transforming health care financing

Realizing the promise of tomorrow requires investing in the health of Texans today. By implementing evidence-based health policies, lawmakers have the opportunity to achieve generational gains in health that will leave a lasting legacy and economic impact on the state.

Background

Over the past decade, commentators across academia, government and mainstream media have declared Texas to be “the future of America.” For Texans, this proclamation is likely unsurprising. After all, Texas ranked third nationwide in terms of population growth between 2010 and 2020 — a trend that further accelerated during the COVID-19 pandemic — and the state population is set to eclipse 30 million in 2022.[1] This population growth has dovetailed with substantial economic gains, with Texas’ gross domestic product (GDP) increasing by more than 36% over the past decade, placing it in the top 5 of all U.S. states in terms of fastest growing economies.[2] Its GDP growth last year was nearly double the national average, and the state’s diverse set of economic opportunities across energy, aerospace, technology, health care and the life sciences continues to attract investment interests and new residents.[3]

Yet while Texas leads across many indicators of government performance and social outcomes, the state notably lags in a major area: health.[4] This may come as a surprise to lawmakers and residents, given that Texas has the most hospitals of any state, employs the second-most health care workers nationwide, and has the third largest Medicaid budget.[5] But the evidence is clear: Despite all of its resources, Texas ranked in the bottom 10 of all states in terms of overall health system performance. These rankings reveal a central paradox about the state: Texans are surrounded by an abundance of health care but are lacking in access to health. For instance, Texas ranks toward the bottom nationwide when it comes to the proportion of children and adults who are uninsured, and scored last in a 2020 assessment by the Commonwealth Fund on access and affordability.[6] In other words, despite being home to the country’s largest medical center, most Texans struggle to find clinics with open doors, with their state ranking No. 1 nationwide in avoided care due to cost.[7] Gaps in access have translated to gaps in outcomes, with preventable hospitalizations among adults and the 30-day mortality rate in hospitals both increasing in recent years.[8]

These challenges extend beyond the health care system, though: The health of the Texas population itself is at risk. Compared to Americans in other states, Texans are more likely to report they are in fair or poor health.[9] And although more and more Americans are attracted to Texas by the promise of a burgeoning economy, new arrivals might also find the reality of declining health. Indeed, compared to the national average, counties in Texas have worse food environments, greater physical inactivity and greater transportation barriers.[10] All of these factors are exacerbated for Texans living in the counties located in the state’s southern tip, for Texans of lower socioeconomic status, and for Texans of color — a reflection of the health disparities pervasive in the state and across the country.

The 2020s will be a pivotal decade for Texas. To preserve its role as a beacon of opportunity and a leader among other states and across the world, policymakers should prioritize improvements in the state’s health care system and the health of its people. To provide policymakers with a road map for health care reform over the next decade, this document identifies 10 key health policy priorities that can help improve Texas’ health rankings and health indicators by 10 spots over the next 10 years (Figure 1). For each priority, we have worked to define the issue area, contextualize the current situation in Texas, highlight relevant evidence-based strategies from the academic literature and present a salient, state-based case study of reforms. Lastly, we identify high-level recommendations for what lawmakers in Texas can do to take action. We believe that this “Texas 10³” can offer a reference point for lawmakers to guide policy-related action for the 2022 state election cycle and beyond. By investing in the health of Texans, policymakers can secure the promise of Texas for future generations to come.

Figure 1 — Policy Priorities for the Texas 10³

 

Priority 1: Close the Health Care Coverage Gap

While Texas may be home to world-class hospitals and cutting-edge clinical care, innovations in care delivery have little value if they are inaccessible to patients in need. Indeed, although the ratios of doctors to patients, dentists to patients, and mental health providers to patients in Texas all exceed the average rates across the country, many Texans still struggle to get the care they need in a timely and affordable manner.[11] This is because nearly 1 in 5 Texans continue to lack access to health insurance. The fact that the uninsured rate in Texas is currently 18% — the highest nationwide and nearly double the national average — reflects the single greatest barrier to advancing the health of Texans.[12] The pandemic has only widened the coverage gap in Texas, which exceeds 30% in counties such as Hidalgo and Dallam.[13]

This high uninsured rate is also the foundation of the affordability crisis in Texas health care. For example, 18.8% of Texans report having medical debt in collection, compared to the national average of 12.6%.[14] Even those with insurance are still paying more for their care in Texas than those in other states. For example, premium costs for Texans enrolled in employer-sponsored health plans account for 27.2% of the median state income (compared to 24.6% nationwide), and out-of-pocket health care costs account for a greater share of Texans’ income than it does for residents of other states (14.2% compared to 11.6% nationwide).[15]

Extensive research underscores the unequivocal relationship between insurance status and health.[16] Expanding health care coverage is associated with improvements in patients’ financial security, increased use of preventive health services, improved diagnosis and management of chronic diseases, and mortality reductions.[17] Notably, policies to close the coverage gap can be especially impactful at addressing disparities in access for racial and ethnic minorities.[18] Given evidence of coverage and outcomes gaps in Texas, policies focused on reducing the percentage of individuals who are uninsured could be transformative for the state.

To close the coverage gap, Texas lawmakers should authorize an expansion of the state’s Medicaid program. Texas is one of only a dozen states nationwide that have not expanded Medicaid, a decision that has resulted in increased costs and the worse uninsured rate in the country. Expanding Medicaid — which would be heavily subsidized by the federal government (90% of the coverage-associated costs) — would provide health insurance to nearly 1 million Texans, eliminate billions of dollars in uncompensated care that Texas hospitals currently incur as losses, and return tens of millions of dollars annually to the state budget.[19]

Case Study in Medicaid Expansion: Louisiana

Texas’ neighbor, Louisiana, shares many similarities with the Lone Star State — except when it comes to health insurance. Since expanding Medicaid in 2016, Louisiana has reduced its uninsured rate by over 50%.[20] Greater coverage rates have translated to greater access to care; for example, over 127,000 women have gotten screened for breast cancer thanks to the Healthy Louisiana expansion, enabling earlier diagnoses and driving a reduction in cancer mortality among Black women.[21] Similar improvements have been reported for the diagnosis of new cases of diabetes and hypertension and access to health services for mental health and substance use disorder.[22] Better coverage has translated into better fiscal performance for the state and its associated health care systems. Research indicates that Medicaid expansion has been associated with significant reductions in medical debt and rates of cost-related care deferrals for patients, while reducing uncompensated care costs by 33% for Louisiana hospitals.[23]

Policy Recommendation

1. Texas lawmakers should authorize Medicaid expansion to close the state’s coverage gap.

Priority 2: Invest in Public Health Infrastructure

Public health is the foundation of population health. While most Texans may think of the Centers for Disease Control and Prevention (CDC) as the primary mediator of public health in the country, the reality is that public health in the U.S. is largely governed and implemented at the local level.[24] In Texas, core public health policy is organized at the state level by the Texas Department of State Health Services (DSHS). Day-to-day oversight and implementation of public health functions are devolved to the state’s regional and local health agencies.

While the state and local public health departments have an important role to play in improving the health of Texans — especially during the COVID-19 pandemic — they often have lacked the necessary resources and mandate needed to protect and promote population health. For example, the National Academy of Medicine (NAM) has called for policymakers to fund a minimum package of public health services to improve the health of individuals and their communities.[25] Expert research indicates that the minimum amount of per-person public health spending should be approximately $32 per capita.[26] However, in 2021 Texas only spent $18 per capita on public health — a 36% decline in spending since 2015 — putting Texas in the bottom 10 of all states for per capita public health spending nationwide.[27] Beyond funding, Texas’ public health infrastructure also lacks adequate governance. The state health department is only one of 10 nationwide that has yet to receive national accreditation from the Public Health Accreditation Board, and only eight of the state’s local health agencies have received accreditation.[28] Research indicates that accreditation is crucial for driving public transparency, increased accountability, engagement, and continuous quality and performance improvement in public health operations.[29

These gaps in funding and governance have had a material impact on public health in Texas. For example, Texas lags nationally when it comes to the adequacy of preventive health service delivery and uptake of age-appropriate vaccines such as the HPV vaccine.[30] Investing in public health infrastructure can therefore provide a sustainable foundation for advancing population health across the state.

Case Study in Funding & Governance: Colorado

Public health in Colorado is led by the state’s Department of Public Health and Environment and is organized into 53 local health agencies.[31] The state spends $55 per capita on public health, and the state health department first received national accreditation over six years ago.[32] A key inflection point for the state was the passage of the Public Health Act of 2008, which created a standard structure for Colorado’s local public health departments and — in alignment with the recommendations of the NAM — created a set of core public health services that all Colorado residents are guaranteed to receive.[33] Research indicates that implementation of several core services increased two years after the law’s passage, with notable improvements around communicable disease services (e.g., prevention and education related to immunizations).[34] Colorado in 2018 issued new rules to align its core public health services with new national guidelines.[35]

Policy Recommendations

1. Texas lawmakers should develop a plan for closing the gap in per capita public health funding in alignment with national standards by the end of the decade, and accordingly appropriate funding increases.
2. The Texas Legislature should define in statute the minimum set of public health services that all Texans are guaranteed to receive, and develop a system for monitoring progress to promote transparency and accountability.
3. DSHS should commit to pursuing state accreditation and supporting local health departments across the state — particularly in the counties with the lowest health rankings — to also achieve accreditation.

Priority 3: End the Women’s Health Crisis

While expanding insurance is a critical priority, coverage is only the starting point, not the destination, for a healthier Texas. The health outcome gaps for Texas women are particularly stark in comparison to those of other states. In 2016, Texas was ranked 48th among U.S. states for overall women’s health and 50th when it came to the design of women’s health policies.[36] The coverage gap is a core issue, with Texas ranking near the bottom nationwide when it comes to the uninsured rate for women. The cost of care is also a significant stressor for Texas women: 44% of women in 2018 reported issues related to medical bills in the last year, and nearly 7 in 10 reported skipping care or medication due to cost.[37]

With regard to outcomes, a long-standing challenge is maternal mortality — which in Texas occurs at a rate of 18.5 per 100,000 births and is disproportionately concentrated among women of color.[38] A 2020 review by the Maternal Mortality and Morbidity Review Committee at DSHS found that 89% of pregnancy-related deaths were preventable.[39] Although a number of policy initiatives are currently underway, including proposals to integrate behavioral health into care and improve care coordination throughout and after pregnancy, many obstacles to broad policy implementation and improving outcomes remain. Of particular concern for patients and experts is how the state’s abortion ban — which carries only limited exceptions for medical emergencies — may affect the availability of reproductive and pregnancy-related health services, especially considering that Texas already has a high rate of teen births — 29 per 1,000 females — compared to the national average (19 teen births per 1,000 females).[40]

Beyond maternal and reproductive health, Texas women continue to face a number of other health issues at a greater proportion relative to other states. For example, Texas women have lower rates of mammography screenings (39% versus 43% nationwide), cervical cancer screenings (74% versus 77% nationwide), dental visits (60% versus 66% nationwide), and well-woman visit rates (65% versus 71% nationwide).[41] 

DSHS has sought to advance policies related to women’s health, including receiving a Section 1115 waiver from the Centers for Medicare & Medicaid Services (CMS) for a new Healthy Texas Women demonstration. However, the waiver itself is subject to operational issues (e.g., administrative barriers regarding enrollment), and the expansion of new benefits is still limited (e.g., only six months of postpartum coverage). To truly advance women’s health, Texas lawmakers need to both roll back policies that curtail access to medically necessary services and advance programs that can provide sufficient resources to close gaps in quality and outcomes.

Case Study in Women’s Health: Massachusetts

Massachusetts has long been a leader in women’s health, with high rates of insurance coverage, utilization of preventive health services, and access to clinical care. Massachusetts’ outcomes reflect a long-term, coordinated health policy strategy that can offer lessons for Texas. First, Massachusetts has prioritized reducing maternal mortality through transparent reporting and performance measurement. The state’s Maternal Mortality and Morbidity Initiative dates back over 20 years and has informed the development of hospital guidelines. It has also spurred efforts to address the social determinants of health in addition to medical factors that impact an individual’s health.[42] Massachusetts’ approach can guide efforts to improve evaluations and interventions in Texas

Second, Massachusetts has sought to expand coverage in order to remove barriers to accessing care. For example, Massachusetts’ Women’s Health Network and 2006 health insurance reform initiative helped to substantially increase screening rates for breast and cervical cancer.[43] Texas could consider applying lessons from Massachusetts to increase outreach through its own Breast and Cervical Cancer Services program, and to implement coverage reforms to improve access to necessary health services. Massachusetts was also recently approved by CMS to extend Medicaid coverage for new mothers to up to 12 months postpartum — a step Texas could consider under its Healthy Texas Women demonstration.

Lastly, Massachusetts has enshrined protections for reproductive rights into law. The Massachusetts Department of Public Health also operates its Teen Pregnancy Prevention Program in 15 high-birth-rate communities, which has helped decrease teen births to a record low and advanced improvements in sexual health education.[44] Such programs and protections could help improve reproductive health in Texas, which leads the nation in repeat teen births.[45]

Policy Recommendations

1. DSHS and the state legislature should amend the state’s Healthy Texas Women 1115 demonstration to remove administrative barriers to health access during pregnancy and expand postpartum coverage from six months to one year.
2. Texas policymakers should commit to reducing maternal mortality levels and increasing women cancer screenings to be on par with national levels within five years.
3. Texas lawmakers should increase protections and program support for reproductive health care.

Priority 4: Establish a Children’s Cabinet

Securing Texas’ future requires investing in the health of the next generation. However, Texas currently ranks in the bottom half of all states when it comes to the health of infants (No. 33) and children (No. 36).[46] Part of the issue is access; Texas currently has the highest uninsured rate for children in the country (12.8%) and a higher-than-average rate of child poverty (19%).[47] Part of the issue is also environmental, as children in Texas are less likely to be physically active, have access to sufficient food or get adequate sleep. The combination of medical and environmental factors has both clinical consequences (e.g., higher rates of obesity and lower rates of childhood immunizations) and social ones (e.g., lower rates of high school completion).[48]

While the health care sector has a key role to play in children’s health, the reality is that promoting health in children begins with healthier communities that make investments across all stages of life. Considering that the challenges of advancing children’s health and well-being are interdisciplinary, 23 states have sought to establish “children’s cabinets,” which help to convene state agencies and local organizations to pool together resources and coordinate activities to benefit children.[49] Applying this integrated community focus to health could also be beneficial. For instance, CMS is currently running a national demonstration project called Integrated Care for Kids (InCK), which seeks to improve identification and integration of kids’ physical, behavioral and social needs and optimize resource allocation using partnerships and financing mechanisms.[50] Although the demonstration is ongoing, Texas could consider reviewing emerging lessons from models in other states such as North Carolina and implementing them under its Medicaid authorities.

Case Study of a Children’s Cabinet: Maryland

Maryland is a national pioneer in the use of children’s cabinets. The state’s cabinet integrates personnel from several agencies, including education, juvenile services, health and budget, and is focused on priorities including mental health, justice system reform, and interventions for child homelessness and hunger.[51]

Maryland’s Children’s Cabinet offers three crucial lessons for long-term success. The first is its focus on partnerships with community-based organizations. Its Children’s Cabinet collaborates with local management boards to fund over 100 community-based initiatives focused on children’s health and well-being, serving as a bridge between state-level policy priorities and local-level program needs.[52] Second, Maryland has created a funding stream dedicated to its Children’s Cabinet, known as the Interagency Fund. Such funds can be used for a variety of functions, including grantmaking, contracting and personnel, providing local organizations and agencies with the necessary discretion to develop tailored, community-centered programs.[53] By reserving resources for collaboration, the Children’s Cabinet is better positioned to advance cross-sectoral work for children’s well-being. Third, Maryland’s Children’s Cabinet operates with a focus on performance evaluation, regularly publishing results on a set of indicators for child well-being.[54] This helps to create accountability for partnerships and taxpayer funding, and enables policymakers to identify high-priority areas that may benefit from additional program support.

Policy Recommendations

1. Texas should establish a “Children’s Cabinet” within the executive branch with membership from relevant agencies and a dedicated funding stream for interagency activities.
2. DSHS should explore opportunities to develop demonstration projects that integrate health and social needs for children using alternative payment models.

Priority 5: Increase Support for Mental Health

The burden of mental health has increased nationally in recent years, and has been the subject of multiple federal initiatives (e.g., the 2021 Surgeon General Advisory on Youth Mental Health).[55] Texas has not been spared in this crisis, with Mental Health America ranking the state 44th nationwide based on metrics including unmet need, coverage gaps and disease prevalence.[56] The bottom-10 ranking for Texas is especially notable considering that the state was recently ranked as high as No. 27 but has fallen precipitously — in large part due to issues related to access and cost. While the prevalence of mental illness in Texas is lower in comparison to many states, the nearly 1 in 5 Texans who do suffer from a mental illness face considerable barriers to receiving the care that they need. In fact, the National Alliance on Mental Illness estimates that nearly half of Texans who forgo necessary mental health services do so because of cost.[57] The barriers are particularly acute for new mothers and young children. For example, the gaps in postpartum coverage — despite the fact that maternal mental health conditions affect nearly 50,000 Texan women annually — are estimated to cost the state billions in added health and social costs.[58]

Lawmakers are well aware of the issue, having taken a number of steps in recent years in an attempt to buttress the state’s infrastructure for mental health care. For example, the reorganization of DSHS was intended to streamline operations to improve service coordination for Texans experiencing mental illness, while the creation of the Texas Mental Health Consortium was intended to expand access via investments in telehealth and workforce development.[59] Likewise, DSHS recently implemented a Directed Payment Program for Behavioral Health Services, which provides financial incentives to providers to promote care coordination and continuity for behavioral health needs.[60] However, while these initiatives are welcome developments, the growing population health burden and persistent gaps in access demand further action. In particular, there is a need to improve coverage, invest in the workforce, and better integrate physical and mental health.

Case Study on Mental Health Innovation: Vermont

Vermont has long been a leader in mental health policy. The state implemented a comprehensive plan for mental health parity over 25 years ago — far in advance of the current crisis — and is consistently well-ranked nationally, landing among the top five states for its overall state of mental health this year.[61] Several innovative policy decisions and programs have enabled the state to maintain high levels of access and low levels of disease prevalence, and can offer valuable lessons to Texas policymakers.

First, Vermont expanded Medicaid under the Affordable Care Act and has an uninsured rate of less than 5%, facilitating access to necessary health services for its residents.[62] Second, Vermont has sought to leverage federal funding to experiment with opportunities to better integrate mental health into primary care in both its pediatric and adult populations. For children, Vermont currently operates the Children’s Health Integration, Linkage, and Detection Grant program.[63] For adults, Vermont participated in CMS’s State Innovation Models program to integrate primary care and behavioral health in the state’s Medicaid program, with evaluations indicating that the intervention was associated with reduced expenditure growth.[64] Based on these experiences, Vermont has implemented a series of payment reforms focused on mental health over the past three years, including for child and adult mental health, residential substance use disorder treatment, and applied behavior analysis to improve access and care coordination.[65] These examples illustrate how addressing mental health requires a combination of policies that promote access and also support advancements in delivery system transformation

Policy Recommendations

1. Texas lawmakers should authorize Medicaid expansion to increase residents’ access to mental health services.
2. The Texas Legislature should take steps to fully advance and enforce parity in mental health coverage.
3. DSHS should build on its current behavioral health payment pilot and incorporate lessons from other states to fully integrate primary care and mental health, and develop new payment models focused on different aspects of mental health. 

Priority 6: Expand Tobacco Control Initiatives

Tobacco use remains the leading cause of preventable death worldwide. Although smoking rates in Texas are slightly lower than the national average, there are significant gaps in Texas’ tobacco control policies.[66] Indeed, the American Lung Association in 2022 gave Texas an F for tobacco control, including failing grades across the domains of tobacco prevention and cessation funding, smoke-free air, tobacco taxes, access to cessation services and flavored tobacco products.[67]

These gaps point to opportunities to further move the needle on a critical population health issue. For one, fewer than 100 Texas municipalities have implemented ordinances and policies to achieve a 100% smoke-free status.[68] Extensive research indicates that such ordinances can promote reductions in smoking rates, and opportunities exist to both introduce ordinances in municipalities that do not have them and strengthen the protection level of existing ordinances if sites (e.g., restaurants and bars) are currently uncovered.[69] Another validated tobacco control policy is the use of taxation. Although Texas does currently collect taxes on cigarettes, cigars and other tobacco products, electronic cigarettes (“e-cigarettes”) — which are increasingly used by children and young adults — are not subject to the same taxes and fees.[70] Implementing taxes could help curtail their use and provide an additional source of revenue for the state.

Lastly, progress toward smoke- and tobacco-free communities also requires investments in clinical infrastructure for addiction treatment. While the majority of smokers express a desire to quit, smokers in Texas may have limited resources. For example, funding for the Texas Quitline is only $0.53 per smoker, 22% of the national median.[71] Furthermore, while Texas has taken steps to increase coverage of key medications and counseling services under the state’s Medicaid program and Employee Health Plan, there is no mandate for private insurers to do so.

Case Study in Tobacco Control: Oregon

Oregon is a leader in tobacco control, using a variety of tobacco control policies to achieve a 42% reduction in smoking rates over the past 25 years.[72] The state has been commended by the American Lung Association for funding its tobacco prevention and control programs, which are nearly on par with CDC recommendations. Oregon also has a number of state and local restrictions on cigarette-smoking in public locations, earning it an A grade for smoke-free air. A core concern for policymakers in Oregon has been the rising rates of e-cigarette use, particularly among youth. Indeed, the percentage of 11th graders in Oregon who reported using e-cigarettes increased from 1.8% to 23.4% between 2011 and 2019.[73] Following a ballot initiative in the 2020 election, lawmakers increased overall cigarette taxes and implemented a new tax on e-cigarettes, an important milestone for tobacco control.[74]

Policy Recommendations

1. Texas state health officials should work with mayors and local health departments to advance smoke-free ordinances in municipalities that are currently uncovered or have limited protections.
2. Texas lawmakers should increase funding for the state’s Quitline and tobacco prevention and control programs to CDC-recommended levels.
3. Texas lawmakers should authorize a new tax on e-cigarettes and associated products.

Priority 7: Prepare for the Health Impacts of Climate Change

Climate change poses substantial risks to human health; it is increasing the frequency, duration  and intensity of infectious disease outbreaks, creates power risks for critical health care infrastructure, and presents direct health threats such as extreme heat and dehydration.[75] Public health in Texas is uniquely at risk due to climate change, something communities have already experienced firsthand during superstorms like Hurricane Harvey, the power grid failure during the winter freeze of 2021 and the record heat waves of 2022.[76] Local governments in Texas are taking notice, with the Harris County Public Health Department initiating a climate resiliency and adaptation program.[77] However, further coordinated statewide action is needed, including efforts to decarbonize key industries (including the health care sector) and long-term strategic planning and governance processes to prepare for the health-related impacts of climate change and associated extreme weather events.

Case Study on Health Adaptations to Climate: Arizona

Arizona, like Texas, is no stranger to hot weather. However, extreme heat from climate change presents significant environmental hazards (e.g., drought) and health risks (e.g., heat stroke) for this Sun Belt state. To address the health impacts of climate change, Arizona has taken a multi-pronged approach. First, the state in 2017 announced a Climate and Health Adaptation plan.[78] This plan, which was developed under the aegis of the CDC’s Climate-Ready States and Cities Initiative, includes strategies on data collection, public education and investments in care delivery infrastructure, and is aligned with the 10 essential services of public health. For example, Arizona developed a Heat Awareness Week to increase public awareness of the resources on the state’s Heat Illness web page and to reduce the number of weather-related emergency department visits during heat waves.[79]

Second, local governments are also investing in strategic planning at the intersection of health and climate change. For example, Maricopa County’s public health department created a climate adaptation toolkit for municipalities, while the city of Phoenix established a dedicated Office of Heat Response & Mitigation.[80] Additionally, local health systems such as Northern Arizona Healthcare have joined the White House’s Health Sector Climate Pledge, which seeks to advance decarbonization in the health care industry. Such steps reflect the beginnings of necessary and foundational investments in governance and programming to mitigate the health-related impacts of climate change.

Policy Recommendations

1. DSHS should develop a statewide climate adaptation plan that incorporates best practices from the CDC’s Climate-Ready States and Cities Initiative.
2. DSHS should work with local health systems across the state to secure commitments from Texas hospitals to meet federal decarbonization targets in line with the NAM’s Collaborative on Decarbonizing the U.S. Health Sector.

Priority 8: Reimagine Long-term Care

While Texas’ population is growing due to immigration, the state is not immune from the secular aging trends of the baby boomer generation, with the elderly expected to account for 1 in 5 Texans (approximately 6 million individuals) by 2030.[81] Older adults are the primary population utilizing long-term care facilities, which in Texas include over 1,000 nursing homes and over 2,000 assisted living facilities.[82] Nursing homes have been the subject of significant national attention since the COVID-19 pandemic spotlighted long-standing issues related to staffing, quality and oversight, and CMS recently unveiled proposals to reform nursing home regulation nationally.[83] Nursing homes in Texas have also been subject to chronic neglect, with a special investigation by the Texas Observer in 2020 highlighting the dominant role of for-profit entities in long-term care and gaps in patient safety.[84] Distressingly, a significant number of Texas nursing homes operate with inadequate staffing levels, and the state led the nation in the number of dangerous incidents reported between 2015 and 2020.

The issues facing long-term care in Texas are multifaceted. The majority of long-term care facility residents are beneficiaries of government-sponsored health insurance programs (Medicare and Medicaid), yet Texas Medicaid has one of the lowest reimbursement rates in the nation.[85] Enforcement of safety infractions is under the remit of the state, and families have limited opportunities for recourse in the courts.[86] Reforms are needed to strengthen oversight, improve public reporting of outcomes and close gaps in financing and staffing.

Case Study on Reforming Long-term Care Financing: Illinois

Like in Texas, the long-term care landscape in Illinois has long been characterized by shortcomings. In 2019, advocacy groups ranked Illinois 49th in the nation when it came to care quality (Texas was ranked 51st).[87] Reporting revealed that the Illinois Department of Health had been negligent when it came to investigating nearly 300 complaints of abuse and neglect during the COVID-19 pandemic, leading to the resignation of a senior state health official.[88] These care gaps during the pandemic were the culmination of chronic gaps in oversight, enforcement and resources.

In response, the Illinois Legislature in 2022 passed a landmark law to reform the state’s nursing home system. First, the law calls for transitioning nursing home payments to align with CMS’s new Patient Driven Payment Model (PDPM).[89] Second, the law includes payment adjustments for nursing homes with large Medicaid populations, an important move toward equity considering that this population is by definition low-income and has historically been served by understaffed facilities.[90] Third, the law includes several provisions to improve staffing and workforce development, including wage increases and incentive payments to align with federally recommended staffing ratios.[91]

Policy Recommendations

1. Texas lawmakers should authorize an increase in Medicaid reimbursement rates, which have not been updated in nearly a decade despite inflationary pressures and budget cuts.
2. Texas lawmakers should provide DSHS with the authority to revise long-term care financing, including promoting alignment with federal payment models and incentive structures.
3. Texas lawmakers should provide additional authority for enforcing staffing requirements and safety infractions, and should require regular performance evaluation and public reporting of outcomes for greater accountability.

Priority 9: Address the Upstream Drivers of Health

While there are numerous areas of need in the health care system, advancing the health of Texans also requires investments in the upstream drivers of health. Substantial literature illustrates how non-medical factors, i.e., social determinants of health, play an outsized role in self-reported health and health outcomes.

While there is much to be celebrated about life in Texas, several features of the built environment of Texas communities and structural factors in society represent important barriers to achieving health for all. A focus on the upstream drivers of health is a core pillar of Public Health 3.0, which is the nation’s framework for transforming public health in America.[92] In Texas, food insecurity, transportation barriers, physical inactivity and child poverty are all examples of the many social needs that, if addressed, could contribute to improvements in health and well-being.[93] While providers and hospitals can play an important role in addressing the upstream drivers of health, meaningful and durable progress will require partnerships across sectors, similar to the coalition-based approach that Houston recently took to address the city’s long-standing challenges with homelessness.[94] Stakeholders throughout Texas have demonstrated interest in working together across sectors on this issue, with the Episcopal Health Foundation and the Robert Wood Johnson Foundation funding a learning collaborative on social determinants of health for Medicaid Managed Care Organizations (MCOs) across the state.[95] The challenge for Texas will be translating these principles into tangible policies and programs to improve health statewide.

Case Study in Buying Health: North Carolina

North Carolina is a leader in the movement to address the social determinants of health. The state launched an initiative to improve coordination across sectors and allocate health care dollars toward “buying health,” the first of its kind in the nation.[96] As part of the state’s 1115 waiver demonstration and Medicare transformation project, North Carolina has launched two key initiatives: the Healthy Opportunities Pilot and the NCCARE360 platform.

While health care leaders generally agree about the importance of investing upstream, a common refrain from the health care sector is the lack of resources and mandate to do so. The North Carolina Healthy Opportunities Pilot sought to fill this very gap by developing a fee schedule within its Medicaid program that organizations can use to purchase and coordinate social services to address transportation barriers, food insecurity, housing insecurity, and interpersonal violence and toxic stress.[97] By doing so, the state is able to encourage the provision of evidence-based interventions that can improve health but have historically been neglected because they exist outside of the traditional lanes of care delivery and reimbursement.[98]

Moving upstream also requires engaging actors and participants outside of the health care system. To this end, the NCCARE360 platform was created as a statewide network for facilitating partnerships and engagement between patients, health care systems and community-based organizations.[99] Each MCO in the state is involved in NCCARE360, which contains resources for over 10,000 social service providers.[100] The platform played an integral role during the state’s response to COVID-19, and continues to provide vital infrastructure that serves as a bridge between health services and human services in North Carolina.

Policy Recommendations

1. The Texas Health and Human Services Commission (HHSC) should develop a platform for improving coordination between the health care sector and community-based organizations.
2. HHSC should use the chassis of value-based payments to create opportunities for MCOs to address the social determinants of health.
3. HHSC should explore opportunities to expand its Accountable Health Communities demonstration to other high-need areas in the state.

Priority 10: Transform Health Financing

Over the past decade, there has been a movement across the health care industry to transform how care is paid for, with a focus on de-linking service volume (i.e., clinical activity) and reimbursement to instead promote arrangements in which payment is tied to the value of the care that is delivered, conceptualized as maximizing outcomes per unit cost.[101] Texas, like many states, has been an active participant in the value-based care movement, using its 1115 demonstration to advance alternative payment models (APMs) and launching a Delivery System Reform Incentive Payment (DSRIP) program to advance innovations in care delivery.

Under these policies and incentives, Texas providers have made progress on the journey to value-based care. However, opportunities for improvement remain. For example, while a near-majority of MCOs are now in some kind of an APM, only 29% have embraced downside risk.[102] Although research shows that the transition to downside risk requires time, further adoption is necessary to fully realize savings and advance care transformation.[103] Likewise, the predominant group of clinicians participating in APMs to date are primary care physicians (45%). Yet although primary care is the bedrock of a high-value health care system, primary care alone is insufficient to reduce the cost of care — especially given that there is greater exposure to costs in specialty and hospital-based settings, which account for only a minority of APM participation in Texas.[104] Furthermore, the involvement of providers beyond primary care can help improve disease management and outcomes, as evidenced in clinical studies of cardiologist involvement in accountable care organizations (ACOs).[105]

No single state has cracked the code when it comes to value-based payment. However, some states have begun experimenting with payment models that would be considered “population-based,” or Category 4 in the Health Care Payment Learning and Action Network’s framework for reforms, which Texas uses to align objectives for its own payment reforms.[106] These states may, therefore, offer lessons (presented below) for Texas.

Case Studies of Category 4 Payment Models

Category 4A: Condition-Specific Population-Based Payment | Example: Episode-Based Payments, Arkansas Medicaid

Arkansas is one of the first states in the country to have implemented and evaluated episode-based payment models within Medicaid, with other initiatives either approved or already underway in Ohio, Tennessee, Connecticut, New York, Oklahoma and South Carolina.[107] This type of payment model has previously been disseminated nationally by Medicare for specific high-cost procedures (e.g., lower extremity joint replacement) and medical conditions (e.g., sepsis). However, the condition set for Medicaid might be different, creating a new set of considerations for state policymakers. The Arkansas Health Care Payment Improvement Initiative focused on perinatal care, and a preliminary evaluation indicates that the payment model is associated with a 3.8% reduction in spending.[108] While further work is needed to monitor quality and explore other eligible conditions, this example illustrates the potential applicability of such a model to Texas

Category 4B: Comprehensive Population-Based Payment | Example: Global Budgets, Maryland

Maryland has long been a pioneer in payment reforms, implementing a global budget model that created a unified prospective payment system for the state’s hospitals and has been found to reduce costs and improve outcomes.[109] Unlike other examples of state-based payment reforms, which tend to be payer-specific, Maryland’s global budget model is “all-payer,” meaning it applies across Medicare, Medicaid and commercial insurers. This provides a bigger lever to impact health care spending across the state, rather than for a specific population. Although implanting a statewide system of all-payer capitation and price regulation will be challenging, other states have begun exploring opportunities modeled after Maryland’s approach. For example, Pennsylvania is experimenting with adapting the global budget model to rural hospitals.[110] Evaluations of the Pennsylvania model are currently underway, and may be of interest to Texas policymakers given that 3 million Texans live in rural areas, yet 26 rural hospitals in the state have closed over the past decade.[111]

Policy Recommendations

1. HHSC should encourage specialist, behavioral health and hospital participation in ongoing alternative payment models.
2. HHSC should commit to launching at least one Category 4 payment model to experiment with alternative approaches to health care financing.

Conclusion

Texas has long been a national leader in health care production. In this paper on the Texas 10³, we have sought to outline a road map to help Texas secure its place as a national leader in health and wellness. By addressing the need to invest in public health infrastructure, focus on critical public health issues for specific populations, and secure the resource investments and regulatory changes necessary to modernize the delivery system, this document aims to help any and all policymakers chart a course forward for the next decade of health reform in Texas. By taking a cross-sector approach to the leading issues of the day, Texas policymakers can help realize the promise of better health for all Texans.

Endnotes

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[2] Andrew DePietro, “U.S. GDP by state and fastest growing states by GDP growth,” Forbes, May 17, 2022, https://bit.ly/3S4RT3Y.

[3] U.S. Department of Commerce, Bureau of Economic Analysis, “Gross domestic product by state, 4th quarter 2021 and year 2021 (preliminary),” 2022, https://www.bea.gov/news/2022/gross-domestic-product-state-4th-quarter-2021-and-year-2021-preliminary.

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