Elena M. Marks and Charles W. Mathias, “Enhancing Texas’ Health Care Investments by Addressing Patients’ Non-Medical Needs” (Houston: Rice University’s Baker Institute for Public Policy, September 16, 2024), https://doi.org/10.25613/A9EF-K766.
The unsustainable escalation of health care costs, coupled with declining health outcomes, is diminishing the value of our health care investments. With nearly $50 billion in annual health care expenditures, Texas has a unique opportunity to enhance the value of its spending by increasing its investment in non-medical services that significantly impact health outcomes.
In recent years, the Texas Legislature and the Health and Human Services Commission (HHSC) have taken steps to advance the integration of health-impacting, non-medical services into health care delivery. However, several additional policy tools are available to the state that could further accelerate this integration, and both the Legislature and the HHSC should actively deploy them.
This report delves into Texas’ investments in non-medical services, presents policy options for advancing this work, and provides examples from other states. It concludes with recommendations on pathways for Texas to consider, with the aim of maximizing the value of its health care expenditures.
With an annual budget exceeding $40 billion, Texas Medicaid represents the largest portion of the state’s health care investment. The integration of non-medical services into this joint federal-state program has bipartisan support, highlighting its importance and potential impact.
Medicaid offers several policy tools to cover non-medical services, many of which are in use in other states. These tools, along with incentives for health insurance plans and health care providers, aim to improve beneficiaries’ health outcomes by incorporating non-medical services.
Beyond Medicaid, Texas has significant opportunities to advance the integration of non-medical services into its behavioral health programs ($1.3 billion), women’s health programs ($150 million), and health programs for state employees and public school teachers ($3.7 billion).
We recommend that Texas continue to build on its recent successes in integrating non-medical services into health care. Key opportunities within Medicaid include:
We also recommend that the state advance non-medical programs targeting priority populations, such as veterans and children, and address critical health conditions like obesity, asthma, and serious mental illness.
Texas has made significant progress in integrating non-medical services into its health care programs, though additional policy opportunities to further this work remain. By investing in health-impacting, non-medical services, Texas can improve health outcomes and maximize the value of its health care investments.
To access the full report, download the PDF.
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