Medicaid eligibility and enrollment in Texas

Many Medicare beneficiaries receive Medicaid’s help with paying for Medicare premiums, affording prescription drug costs, and covering expenses not reimbursed by Medicare – such as long-term care.

Our guide to financial assistance for Medicare enrollees in Texas includes overviews of these benefits, including Medicare Savings Programs, long-term care coverage, and eligibility guidelines for assistance.

In every state, Medicaid disenrollments were paused from March 2020 through March 2023, as a result of the COVID pandemic. Even if a Medicaid enrollee’s circumstances changed and they were no longer eligible, their coverage was not discontinued. But that ended March 31, 2023, and states resumed regular eligibility redeterminations.

In Texas, Medicaid enrollment grew steadily throughout the pandemic, increasing from about 4 million people in early 2020 to nearly 6 million by April 2023. Under federal rules, all Medicaid enrollees’ eligibility had to be redetermined at some point in the year-long “unwinding” period that began in the spring of 2023. Texas prioritized eligibility determinations for people they expected to no longer be eligible for Medicaid (including, for example, people who had aged out of the children’s eligibility category, or people who were covered due to pregnancy and had since given birth).

Texas reported disenrollment data here. By the end of the year-long unwinding process, nearly 2.5 million people had been disenrolled from Texas Medicaid, and enrollment had dropped to about 4.2 million people.¹⁴

Most of the disenrollments — about 1.7 million people — were for procedural reasons. This means the state didn’t have enough information to determine whether the person was still eligible or not.¹⁴

Political leaders in Texas have remained mostly uninterested in expanding Medicaid. Instead of pushing for legislation to expand Medicaid, Texas officials negotiated with CMS in an effort to secure ongoing funding to cover uncompensated care in the state. The state’s 1115 waiver was initially approved in 2011, and was intended to temporarily ensure funding for uncompensated care prior to the expansion of Medicaid. But after the Supreme Court’s 2012 ruling essentially made Medicaid expansion optional for states, Texas has rejected Medicaid expansion and instead continued to rely on the 1115 waiver’s federal funding to cover uncompensated care.

The Obama Administration had previously noted that uncompensated care funding would be largely unnecessary if states expanded Medicaid, but the Trump administration was more willing to work with states that had refused federal funding for Medicaid expansion.

Texas officials were successful in getting the Trump Administration to agree to a five-year extension of the state’s waiver for uncompensated care, and Texas received $25 billion in federal funding as a result, from 2018 through 2022. (The state’s 1115 waiver details are available here.) And in January 2021, the Trump administration agreed to extend the 1115 waiver out through 2030.

The Biden administration rescinded that extension soon after taking office. A few months later, however, a judge temporarily blocked the federal government from rescinding the 1115 waiver’s extension. But in September 2021, the federal government halted payments to the state over concerns about how Texas was funding its share of the cost. In March 2022, that funding — which amounts to $7 million per day — was restored.

That’s more than $2.5 billion in annual federal funding. But it’s worth noting that Texas would receive an estimated $6 billion in annual federal funding by expanding Medicaid, and the effect of that influx of federal money would have a ripple effect on the state’s economy that would amount to $100 billion over ten years. Expanding Medicaid would be a financial boon to Texas.

By refusing Medicaid expansion under the ACA, Texas has already missed out on billions in federal funding that would otherwise have flowed to the state to provide medical care for their low-income residents. The current estimate is that Texas is rejecting between $5 billion and $6 billion in federal funds every year that the state refuses to implement Medicaid expansion.¹³

In addition, the state’s emergency rooms are providing $5.5 billion in uncompensated care each year, treating patients who don’t have health insurance (as noted above, the state is receiving about $2.5 billion in annual federal funding to cover uncompensated care). If Medicaid eligibility had been expanded, uncompensated care would have dropped considerably, so hospitals and business groups across the state have been pressuring lawmakers to relent on their opposition to Medicaid expansion.

Because Texas has refused to expand Medicaid, the federal government has warned the state that continued access to federal funding to help cover uncompensated care is in jeopardy (since Medicaid expansion would solve much of the uncompensated care problem). But Governor Greg Abbott has continued to reject Medicaid expansion, and described the federal government’s tactics as “coercive”

Since residents in states not expanding Medicaid still have to pay federal taxes, there has been a significant outflow from Texas residents to fund Medicaid expansion in other states.

During the 2013 legislative session, Republican John Zerwas sponsored HB3791, which would have directed the state to craft a “Texas solution” to Medicaid expansion. But it did not pass. The bill called for reforming the state’s Medicaid system while also accepting federal funding to expand the program. It also included “personal responsibility” measures like copays and deductibles, and would have included premium assistance programs to help people purchase private insurance as a preferable alternative to traditional Medicaid.

But also in 2013, Republican lawmakers in Texas passed a measure that requires the state Health and Human Services Commission to receive approval from the legislature before any future Medicaid expansion decisions could be made.  So ultimately, even if a governor were to support Medicaid expansion, the decision rests with the Texas Legislature. This makes expansion very unlikely in the near future, given lawmakers’ general rejection of the idea.

As long as Medicaid eligibility continues to be unchanged from 2013 guidelines, the cost of uncompensated care in Texas hospitals is roughly $5.5 billion a year, and it’s largely paid by tax dollars and higher health insurance premiums for people who do have coverage, in addition to federal funding that the state has secured via an 1115 waiver.

Former Governor Rick Perry repeatedly rejected Medicaid expansion. During the 2014 Governor’s race, Republican Greg Abbott (who won by a significant margin) agreed with Perry and expressed his opposition to accepting federal funding to expand Medicaid (both men claimed that the eventual 10% of the cost that the state would pay by 2020 would be too much for the budget). Democratic candidate Wendy Davis was in favor of Medicaid expansion in Texas, but she lost the election.

In late 2014, Abbott expressed interest in Utah’s Medicaid expansion waiver (Utah ultimately ended up seeking federal approval to expand Medicaid only to the poverty level, but voters took the matter into their own hands in 2018, passing a ballot initiative that ultimately resulted in Utah fully expanding Medicaid as of 2020). And while that instilled hope that Abbott might soften his stance towards Medicaid expansion, he remains opposed to it.

It’s noteworthy that in November 2014, a 15-member board of medical professionals appointed by Governor Perry recommended that the state move forward with Medicaid expansion. The Texas Institute of Health Care Quality and Efficiency board has recommended Medicaid expansion as a solution to what they called an “unacceptable” number of people without health insurance in Texas.

State lawmakers only meet in odd-numbered years in Texas. Numerous bills were introduced in 2015 in an effort to expand coverage, but none were successful. While multiple bills were filed in 2019, they were not passed. And Medicaid expansion legislation in 2021 was also unsuccessful. Several bills related to Medicaid expansion were filed in 2023, including HB1062, HB1144, and SB343, but none were successful. As noted above, additional Medicaid expansion bills have been introduced in 2025, but experts doubt they will be successful.¹¹