AUSTIN - Border lawmakers have welcomed a preliminary agreement to settle a 14-year-old lawsuit that would require Texas to comply with its obligations under the Medicaid program.

Under the terms of the agreement reached in Frew v. Hawkins Monday, the state has agreed to increase the Medicaid reimbursement rates to medical and dental providers who care for children's Medicaid participants, by 25 percent and 50 percent, respectively.

Additionally, the agreement requires the state to improve access to care via transportation assistance, updating provider listings and hiring more caseworkers to assist families trying to access Medicaid services.

“The results of this preliminary settlement are a significant victory for the over two million children on Medicaid. The state of Texas has reneged on its obligations to eligible Texas children for far too long, and the children have paid the price,” said Rep. Abel Herrero, D-Robstown, a member of the House Human Services Committee.

“The terms of the settlement will compel the State to make measurable efforts towards ensuring that children on Medicaid actually receive the care they deserve, and that federal law requires. It is a first step towards giving our children a healthy start, which can positively impact them over a lifetime.”

Sen. Eliot Shapleigh, D-El Paso, said that for the 106,000 El Paso children on Medicaid, the Frew settlement could mean increased regular visits to doctors and dentists, and a greater selection of physicians from which to choose. 

“The Frew case is to health care what Edgewood was to schools. Now, the state must provide basic access to healthcare for 106,000 El Paso children,” said Shapleigh, a member of the Senate Health and Human Services Committee. “Since 1993, we have fought to increase reimbursement rates, which are the key to more doctors and dentists on the border.”

In 1984, MALDEF filed Edgewood ISD v. Kirby, a landmark public school finance case citing discrimination against students in poor school districts.

On April 29, 1987, the state district court ruled in favor of the plaintiffs. The court found that the state's public school financing structure was unconstitutional and ordered the legislature to formulate a more equitable solution.

Certified as a class action in 1994, the Frew lawsuit reached an initial settlement in 1995, where the state agreed to increase its outreach and ensure that eligible children received any medically necessary care as required by federal law. 

The state's non-compliance with the terms of that settlement agreement resulted in ongoing litigation, the resolution of which was the preliminary agreement reached between the parties on Monday. A final version of the settlement agreement is expected in the near future.

Shapleigh said El Paso County traditionally has had low Medicaid reimbursement rates because of the method for determining funding, which takes into account such things as demand and cost for services, as well as wages. 

In 2003, the state made further cuts to Medicaid reimbursement rates when the legislature faced a $10 billion shortfall.

The Senate Finance Committee approved a new two-year budget Tuesday that includes $700 million to cover the cost of the Frew settlement.  “God bless Susan Zinn,” Shapleigh said, referring to the San Antonio attorney who led the plaintiffs’ case.

Herrero said that while he was heartened to see that the Frew lawsuit was on its way to a final settlement, he urged legislative colleagues not to rest on the court’s decision alone. 

“We must place appropriate pressure on the leadership to provide full funding, fulfill the terms of the settlement and keep our commitments to Texas children,” Herrero said.

“We can use this outcome to turn a corner in our public policy and place the well-being of children first, and I am confident that our legislature will do the right thing, not simply because we are legally bound to do so, but because it is the right thing to do.”