‘Starting from scratch’: Texas Medicaid may cut Cook Children’s Health Plan

Born prematurely at 27 weeks, MJ Hernandez came out of the womb unable to eat on his own. 

Following intensive feeding therapy, he was issued a gastrostomy button, placed in his stomach with a feeding pump, to provide his necessary nutrients. 

MJ also has chronic lung disease, cerebral palsy, hydrocephalus — a fluid buildup in the brain — and is on the autism spectrum. 

Now 10, he can eat by mouth, but still uses the G-button for water and medications, said his mother, Breanna Hernandez. 

MJ’s G-button, among his other treatments, are covered by Cook Children’s Health Plan, a Medicaid and children’s health insurance program. Soon, MJ and 10,000 other children with complex medical needs — including 1,700 in wheelchairs and 170 on ventilators — may lose access to vital health care services because the state declined to renew the plan’s contract.

“We would be paying out of pocket,” Hernandez said. “The button itself is $500. I’m sure his monthly supply bill would be way over $1,500.”

In March 2024, the Texas Health and Human Services Commission, which oversees the contracts and funding for the state’s Medicaid STAR and CHIP programs, denied Cook Children’s Health Plan a renewed contract. The decision puts the care of 125,000 health plan members from low-income families and children with complex medical needs at risk starting in September. 

STAR, or State of Texas Access Reform, is Texas’ Medicaid program for low-income children, pregnant women and families. CHIP, the Children’s Health Insurance Program, covers children in families that earn too much money to qualify for Medicaid, but can’t afford private insurance. 

Cook Children’s Health Plan is appealing the decision, arguing that the state’s scoring methodology lacked transparency and disadvantaged regional provider-sponsored plans. 

If the decision is not reversed, families relying on the health plan will have care disrupted and be forced to change doctors, nurses and specialized care providers, according to Cook Children’s officials.

As a result of the decision, those officials say, 1.8 million children, pregnant women and adults enrolled in the STAR and CHIP plans will be forced to find a new plan. This disruption will cause 75.6% insurance plan turnover in Tarrant County. 

The continuous care the health plan provides for Hernandez is imperative. Without it, she would lose the service coordinator who has helped her pinpoint necessary local resources for the last decade. 

“We’ve been at Cook’s since the beginning. Everything there just flows,” Hernandez said. “We’re able to go in there and we know what to expect. We know the care that we’re going to get.”

The contract termination could impact 400 Fort Worth employees, 1,455 primary care providers and 2,550 specialists, according to Cook Children’s.

“Some of MJ’s doctors have known him literally since he was in the NICU,” Hernandez said. “We would be starting from scratch. Like if I just had a newborn all over again.”

Cook Children’s Health Plan is 25 years old

If the contract termination goes through, other insurance companies will be given the contract and take Cook Children’s place, said Karen Love, president of Cook Children’s Health Plan. Members would choose a new health plan, but are limited to four national for-profit plans. 

Under a different plan, members still get the same Medicaid benefits — doctors visits and certain treatments would be covered. However, community-based care coordination, a plan local to Fort Worth and Tarrant County, would disappear, Love said.

Cook Children’s Health Plan is a part of Cook Children’s Health Care System. The hospital, doctors and health insurance company are able to work together to provide the best care for patients for the past 25 years, Love said. 

“All of that is an opportunity families have that’s different than if they get a for-profit national company insurance based out of another state,” Love said. “Their care coordinators and social workers don’t know the local community. They don’t know the resources that these families may need for things other than health insurance.”

The plan’s ability to provide coordinated care is a strong reason to keep a local plan available to families, Love said. If a family needs diapers or food pantries, coordinators from the health plan are able to point families in need in the right direction. 

With a new Medicaid plan, doctors and hospitals that families rely on may no longer be in-network, Love said. 

Though Cook Children’s will remain, primary care providers and other specialists may not — leading to unnecessary disruptions in care, she added. 

“We’re talking about families who are struggling to make ends meet, put food on the table and pay their rent,” Love said. “They don’t need the hassle of figuring out, ‘Who am I going to use now for my kids’ physical therapy?’”

As a nonprofit, Cook Children’s invests its revenue back in community-based programs, such as neighborhood health centers in primary care deserts. Cook Children’s is driven by local community needs, Love said.

The health plan saved the state of Texas millions of dollars in recent years through proactive preventative health care outreach efforts for children from lower-income families and communities, according to Cook Children’s. These efforts include a partnership with Tarrant Area Food Bank and providing COVID-19 vaccines to homebound children. 

What’s next?

Cook Children’s Health Plan filed a protest with the state in March 2024, citing that the scoring process for issuing contracts favors large, national for-profit companies. Cook Children’s was notified in June that year that the protest was denied. 

On June 26, the health plan announced it was taking legal action to stop the “flawed process” that led to the commission taking away Cook Children’s longstanding contract administering Medicaid to local families. 

Cook Children’s filed a petition for declaratory judgment and Injunctive Relief against Health and Human Services Commissioner Cecile Erwin Young to overturn the decision.

Proposals in the Legislature 

State lawmakers filed two bills to change how Medicaid contracts are awarded: 

The proposals aim to ensure quality health care access for all Texas Medicaid recipients, said Rick Merrill, president and CEO of Cook Children’s Health Care System.

If passed, the bills would change the law on how the Health and Human Services Commission awards contracts for the management of its STAR and CHIP programs. The bills would give families a choice in health insurers and protect the right to have Medicaid-dependent children’s health care managed locally, Merrill said. 

“We are doing everything we can to protect North Texas families from this harmful decision. But we can’t do it without the support of Texas legislators,” Merrill said. 

The Legislature’s last day is June 2, 2025.

The state is treating kids as if they’re numbers, Hernandez said. For now, she’s looking for alternative options — even if it means moving to a state more favorable for medically complex children.

“Is that something I would want to do? Absolutely not. I’ve lived in Texas my whole life,” Hernandez said. “But it’s all for MJ and I’m going to do whatever I need to for him.”

Kathryn Miller is a reporting fellow at the Fort Worth Report. You can contact her at [email protected]. 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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