Noah, now 3 years old, qualifies for Medicaid coverage because he had been approved for , and his neurologist sent paperwork to get the state to cover the therapy. But Medicaid officials rejected the request. Braulio De La Cruz appealed the decision, but that effort hit a major roadblock last fall when the state suddenly said the Medicaid program would not cover behavioral therapy.

Now De La Cruz, of Houston, and other parents — who say their children with autism are legally entitled to such treatment — are butting heads with Texas officials. And without Medicaid coverage, they must either forgo the therapy or find a way to pay for individual insurance plans that help pick up the costs.

Texas Health and Human Services Commission representatives declined to comment for this story, except to say that Texas, like other states, is reviewing guidance from the federal Centers for Medicare & Medicaid Services (CMS) on this issue. Texas legislative leaders also declined to comment.

Dan Unumb, executive director of the Legal Resource Center at Autism Speaks, a national advocacy group for families, said if federal officials don’t weigh in, Texas families may have to turn to litigation to convince the state not to resist covering behavioral analysis. De La Cruz says he is considering a suit, if the state doesn’t change its course.

“I don’t know if they’ll continue to draw a line in the sand, and I don’t know what steps CMS may be taking,” Unumb says. “My sense is that there’s many layers to things in Texas.”

A Federal Directive

In 2014, CMS advised states that they must cover all medically necessary care for Medicaid-eligible children with autism up to age 21. Advocates say that includes therapies a doctor deems necessary for a child, including behavioral analysis, which uses positive reinforcement to encourage behavioral modification and can run from $60 to $150 an hour.

Some states — California, Virginia and Maine, for example — needed very little prodding to put policies in place. Others, including Ohio and Florida, did so only after being hit with court suits.

But Texas responded slowly. One of the advocates at the center of the debate is Shylo Bundy. When her daughter, Zuri Horsley-Bundy, who qualified for Medicaid also through the SSI program, was diagnosed with autism at 15 months of age, the toddler’s doctor prescribed 30 to 40 hours a week of behavioral therapy. Medicaid officials denied the coverage. Bundy, an attorney who lives outside Dallas, immediately put her law skills to work, spending months appealing, making phone calls and contacting legislators until she eventually got the state to reverse the decision. (Bundy and her husband have traded off not working so that someone can be home to take care of their daughter.)

After her success, Bundy began a pro bono effort to help a handful of other families get Medicaid coverage, too.

In 2015, she and others were having regular meetings with legislators and Texas Health and Human Services officials. Bundy said she thought state officials were gearing up to add behavioral therapy to standard Medicaid coverage for children with autism, which generally includes occupational, speech and physical therapy.

But that stopped after the legislature last year did not pass a bill to license behavioral therapists. Legislators opposed licensure for several professions saying it was overregulation. Shortly afterward, the state stopped covering autism behavioral therapy.

“The state had said what would make them feel better about Medicaid covering ABA was if [therapists] were licensed,” Bundy says. “It’s not required under Medicaid law, and many other states provide ABA without licensure. But we were working on getting a licensure bill passed. When it didn’t pass, the state cut all those people off [from ABA].”

Bundy says that the state had approved only 10 children for the therapy — including her daughter — and all but two were left without the therapy. State officials have not made clear why coverage continues for those two.

Not ‘A Defined Benefit’

Peter Hofer, senior litigation attorney for Disability Rights Texas, is representing De La Cruz and some families who lost coverage. One of them was left with $30,000 in bills when behavioral therapy that had been approved for Medicaid coverage was discontinued for their 6-year-old son. Medicaid refused to pay for therapy he had already received, Hofer said.

After contacting state officials last September, Hofer received a reply two months later from Gary Jessee, the associate commissioner for Texas Medicaid and the Children’s Health Insurance Program, another federal-state program that provides coverage to kids from lower-income families who earn too much to qualify for Medicaid. The letter said the state does not have to cover behavioral therapy because federal officials listed it as only one of several treatments and did not mandate that behavioral analysis be covered.

“In response to your contention that the July 2014 CMS guidance requires that [Texas] provide ABA to your client, Texas Medicaid respectfully must disagree with your conclusion,” Jessee wrote. “Texas Medicaid currently provides medically necessary services to children with autism spectrum disorders, such as physical, occupational, and speech therapy and nutrition counseling. … ABA is not currently a defined benefit in the Texas Medicaid program.”

In early 2016, Hofer sent a complaint against the state of Texas and a request for assistance and intervention to the Centers for Medicare & Medicaid Services.

Bob Moos, a public affairs specialist for CMS, said that federal officials are discussing the behavioral therapy issue with Texas officials, but he declined to give any details.

Expensive But Effective

Abbi Coursolle, an attorney with the National Health Law Program, a national advocacy group, said Medicaid must cover behavioral therapy if that is prescribed by a child’s doctor. Physical, occupational, speech, and nutrition therapies are not a replacement for behavioral therapy, she adds.

“A few other states have tried making that argument and have not succeeded,” Coursolle said of Jessee’s assertion.

“Texas is beginning to look like an outlier here,” she said. “Over half of the other states have moved to do something. As far as I’m aware, Texas is the only state digging in its heels and saying they won’t do it at all.”

Some of the issues have been litigated. Even before the 2014 CMS directive, at least two federal courts ruled in favor of children seeking behavioral analysis therapy services from Ohio and .

Unumb said behavioral analysis is a very resource-intensive therapy but that it can make a huge difference in children’s lives.

“ABA is based on scientific research,” Unumb says. “For many kids it takes upwards of 30 hours a week of intensive therapy to achieve desired results. That sounds like a lot, but when you’re looking at a lifetime of consequence, and at the dramatic difference it can make, it makes sense to comply with the law.”

Bundy can attest to that dramatic difference. She said her daughter’s speech was at the level of an infant when she began behavioral therapy at 18 months old. After six months of that therapy, her speech had reached age level, and Bundy was told that she should be able to start school in a regular classroom without needing long-term support.

“She is proof that early and intensive ABA works,” Bundy said.

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Their employers’ insurance plans offered limited coverage, so for 2015 the Houston family purchased an individual plan for their son on the marketplace set up by the federal health law. Because Texas mandates that individual plans must cover applied behavioral analysis (ABA) therapy, other parents of autistic children have made a similar choice. But many of those families are facing difficulties finding adequate coverage in 2016.

The Maupins chose a , which covers some of the cost of doctors and hospitals that don’t have contracts with the insurer. Since they opted for an out-of-network therapist, that meant higher out-of-pocket payments, but the plan’s partial coverage made the intervention therapy affordable, and their son began to make strides.

“He went from a 2-year-old speaking three words, a kid we thought was significantly delayed, to a kid with normal language who is cognitively ahead,” Maupin said of her son.

But 2016 brought some major changes to the individual marketplace and they don’t have the same option this year. Most major insurance carriers in the state have done away with PPO plans and have replaced them with options that provide no coverage for out-of-network care, such as HMOs. Insurers said the move came after heavy losses from large numbers of high-cost enrollees buying individual plans and a shortfall in payments expected from the government.

Employer plans generally do not come under the states’ requirements to cover expensive autism therapies, so families often choose to buy individual plans for their children in those states. Insurers say that trend is among the factors driving up their outlays in marketplace business.

“The cost of individuals enrolling on the market far exceeded expectations,” said Clare Krusing, director of communications for America’s Health Insurance Plans, a national trade group. “What compounds the problem is that some co-ops failed as well, so plans had to take on the risk associated with new enrollees.”

Krusing said that another blow to insurance companies was a drastic reduction in expected federal payments as part of the Affordable Care Act’s premium stabilization program. That is supposed to help insurance carriers for several years during the health law transition, in part by transferring funds to individual marketplace insurance plans that are not making money.

“Plans will receive 13 percent of what they were owed,” Krusing said. “Every plan is impacted by that shortfall and has had to reevaluate their participation in the marketplace.”

The problems have been big in Texas. “Texas is particularly problematic for the insurance companies in terms of losses,” Justin Boulet, an insurance broker in Houston who works with families with special-needs children, wrote in an online forum. “The individual insurance market in Texas is suffering traumatic financial loss that is completely unsustainable long term.”

Blue Cross Blue Shield of Texas, one of the carriers that eliminated its PPO marketplace plans, was candid about the decision.

“The reality is, our individual policies just weren’t sustainable,” Dr. Dan McCoy, chief medical officer for the company, said in a posted online Dec. 4. “We experienced significant financial losses … if we continued to offer the individual PPO, we’d have to raise those rates as well as the rates for all of our individual plans. Our competitors are facing the same dilemma … in fact, no one is offering a broad individual PPO anywhere in Texas anymore.”

Since the release of McCoy’s video, at least one carrier, Humana, did offer a broad individual PPO plan in some Texas counties. But the  — an out-of-pocket maximum of $25,800 for out-of-network providers — which makes it unaffordable for many families.

And all these changes come at a time when  — 1 in 45 — are being diagnosed with autism.

‘It’s Pretty Drastic’

For Carol Markes, a Dallas-area parent who bought her autistic son an individual PPO marketplace plan in 2015, the changes in the marketplace plans meant suddenly losing access to her son’s general neurologist, the neurologist that deals with his epilepsy and his primary care doctor — all providers who had been in network.

“My husband is an independent corporate contractor and I substitute teach when I’m not at home because of my son’s many issues,” Markes said. “We simply cannot lose all his doctors! This is crazy!”

“It’s pretty drastic,” Lee Spangler, vice president of medical economics for the Texas Medical Association, said of the insurance company changes. “The ACA says a carrier can’t turn someone down for a preexisting condition. But these new narrow networks — that’s the new medical underwriting.”

Many parents say they will find ways to adjust. Markes and her husband opted to buy a small group plan for his business that would cover their son’s providers. That means their insurance costs will increase by 35 percent in 2016, but it also means all of their son’s doctors are in network.

Other parents, like Dallas residents Jill Albright Briesch and her husband, have decided to simply pay out of pocket for certain therapies. For Jill Briesch that also means picking up more work as a CPA to cover the bills for her two sons, Alexander and William, both of whom are on the autism spectrum.

“We’ve absorbed $1,100 a month in in-home ABA,” Briesch said. “Our speech therapist is out of network, and we just pay her.”

Briesch knows that her family is lucky to be able to make that kind of decision; many cannot.

“Texas is a very difficult state to live in if you have a child with autism and you’re not really rich, or really educated,” Briesch said.

She also lamented that the current policies are short-sighted. “Early intervention saves hundreds of thousands of dollars on the back end by improving [autistic] people’s life functionality,” she said. “If you can get even 25 percent of them to function as normal adults, you’re saving money. If they end up needing 24/7 supervision, the state doesn’t even want to know how expensive that will be.”

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This story can be republished for free (details).