Cook Children’s Health Plan to continue through 2025 after Texas Medicaid decision delayed

The fate of Cook Children’s Health Plan, which serves more than 125,000 families in the Tarrant County area, has been pushed back and will not be decided until next summer. 

Officials with the Texas Health and Human Services Commission have agreed to delay signing new Medicaid contracts until June 2025, giving state lawmakers the opportunity to weigh in on the proposal during their next legislative session beginning in January. 

The $116 billion Medicaid contract proposal would drop the Cook Children’s Health Plan, alongside the Driscoll Health Plan in South Texas and the Texas Children’s Health Plan in the Houston area, from Medicaid STAR and CHIP plans starting in September 2025. 

The proposal would force low-income Tarrant-area residents to change their children’s health coverage to other organizations, including Aetna Better Health of Texas, Molina Healthcare of Texas, UnitedHealthcare, and Blue Cross and Blue Shield of Texas.

A bipartisan group of Tarrant lawmakers, including House Speaker candidate state Rep. David Cook, R-Mansfield, has criticized the Medicaid proposal in support of Cook Children’s Health Plan. 

The delay, detailed in a 13-page legal proceeding, included an agreement from all parties — Texas Health and Human Services Commission, Cook Children’s Health Plan, Texas Children’s Health Plan, Superior HealthPlan, and Wellpoint Insurance Company — to stall the decision until after the session, which wraps up in June. 

The parties will fill and present a joint status report to the court on or before July 2, 2025.

Aetna and Molina, which would receive hundreds of millions in new contracts under the Medicaid proposal, have filed appeals against the motion, according to the proceeding.

The agreement comes nearly a month after Travis County District Judge Laurie Eiserloh granted a temporary restraining order to the children’s health plans, stating the state’s proposed changes could negatively impact the public. 

Officials with Cook Children’s Health Care System celebrated the joint agreement by stating that the motion will allow for all parties to come together “to find a solution that best supports families and communities.”

Launched in 2000, Cook Children’s Health Plan provides health coverage to Tarrant County-area families with Medicaid and CHIP. The Medicaid STAR and CHIP programs cover the cost of routine, acute and emergency medical visits.

STAR is primarily for pregnant women, low-income children and some adults who cannot afford health insurance, while STAR Kids is for children with disabilities. CHIP provides care to children in families that earn too much money to qualify for Medicaid, but cannot afford to buy private insurance. 

“We look forward to collaborating with members of the Texas Legislature during the upcoming session to ensure a just and equitable solution,” a Cook Children’s spokesperson said in a statement. “As we’ve consistently maintained, this issue is of paramount importance, affecting thousands of children and families in many underserved communities across Texas. This is undoubtedly the right course of action. Thank you to everyone involved.”

A spokesperson for the Texas Health and Human Services Commission declined to comment and deferred to the motion filed in court. 

The state’s decision to delay comes nearly five months after Cook Children’s filed a petition in Travis County against Cecile Young, executive of the Health and Human Services Commission, to stop the state agency from finalizing its procurement results. 

“Our families are worth fighting for, and we’re going to continue to fight until the state does the right thing,” Karen Love, president of Cook Children’s Health Plan, said during a June 26 press conference. “The stakes are too high and the consequences are too great to have this flawed decision set in stone. We are determined to ensure that it does not.”

In Texas, Medicaid STAR and CHIP contracts run for six years, with three two-year renewal options. After contracts have been in place for 12 years, the agency runs a new procurement. During that process, the agency issues requests for proposals, accepts bids and puts insurers through an evaluation process before awarding the new contracts.

When the Health and Human Services Commission directed managed care organizations to start preparing proposals for new contracts in December 2022, it included new elements. Among the changes was a new scoring-and-ranking system that placed more emphasis on numerical scores rather than health care quality, community preferences, market share and historical performance.

Cook Children’s filed its original protest March 21 and said the state’s process was “deeply flawed” and failed to give preference to health plans with successful track records that provide care to special populations. The state’s decision didn’t consider how continuity of care would be impacted, according to the health system.

Representatives for Cook Children’s also allege the state agency did not go through the proper process for selecting providers and instead gave Aetna, one of the winning bidders, “an unfair advantage by prematurely disclosing copies of its competitors’ proposals.” 

Lawyers for Aetna have previously asked for the opportunity to defend the company against allegations that the process had been tainted and was illegal, according to The Dallas Morning News. 

With its legal actions, Cook Children’s hopes to remain on the list of options for families in its network. If the health system does not win its legal challenge, Cook Children’s would likely shut down its health plan, but the hospital itself is not in danger. 

If the procurement is dropped, this will be Texas Health and Human Services’ third unsuccessful attempt to procure new contracts for STAR and CHIP managed care organizations. 

Cook Children’s advises its health plan members to continue seeking care from doctors and other providers as coverage will remain active for at least the next year. 

David Moreno is the health reporter for the Fort Worth Report. His position is supported by a grant from Texas Health Resources. Contact him at [email protected] or @davidmreports.

At the Fort Worth Report, news decisions are made independently of our board members and financial supporters. Read more about our editorial independence policy here.

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