STATE ISSUES
Private Duty Nursing (PDN) and Pediatric Therapy are at the top of TAHC&H's state legislative agenda heading into the 90th Texas Legislative Session. Across the state, providers are struggling to recruit and retain quality and competent staff because current payment methodologies don't reflect the real costs of care or align with patient acuity, leaving medically fragile children among the hardest hit. TAHC&H is calling for a comprehensive review of Private Duty Nursing and Pediatric Therapy reimbursement rates to ensure they cover actual care costs, support workforce stability, and reduce the delays keeping children hospitalized longer than necessary.
Similarly, unit-based billing of therapy services fails to account for travel time and other unique service demands, contributing to long waitlists and delayed care for children who need it most. TAHC&H is pushing for a hard look at whether current rate structures capture true provider costs, including unfunded expenses like mileage, EVV, PPE, and training, while addressing compliance issues tied to attendant misclassification. These priorities reflect TAHC&H's commitment to building a Medicaid system that works for Texas families, caregivers, and the providers who serve them.
ISSUES
funding
Texas Medicaid’s rate‑setting system is flawed. By isolating Provider Finance from Medicaid policy teams, Texas has created a process that produces rates misaligned with legislative intent and the real cost of care. This siloed structure locks in flawed cost assumptions, leaving providers with unfunded compliance burdens and shrinking capacity to provide quality care.
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The state’s own data underscores the problem. HHSC reported a 21% PDN rate shortfall in its Legislative Appropriations Request for the 89th legislature highlighting payment disparities as a major barrier to retaining qualified staff and prioritizing PDN for a rate increase. Meanwhile, MCOs cite losses in STAR Kids to justify cutting provider rates in a program already underfunded by 21%.
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Payment policy changes after 2017 switching from visits to units further reduced access to therapy services for children by failing to account for drive time and other essential components of home‑based care. As a result, access has deteriorated: by June 2025, 7,701 medically complex children were waiting for therapy, an 18% increase in six months, because providers cannot recruit enough clinicians at current rates.
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TAHCH urges the Texas Legislature to take immediate action:
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Coordinate with HHSC to uphold actuarially sound rates that reflect their recommendations for the 89th Legislature.
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Tie payment policy to access by incentivizing PDN access standards through rate‑cell methods in managed care.
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Restore home health therapy payments to visit‑based reimbursement to reflect actual service delivery.
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Publicly report therapy waitlists through a standardized mechanism.
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Incentivize pediatric therapy access standards within capitation models.
REGULATORY BURDENS
Government red tape and conflicting rules from regulators are complicating the home care and hospice industry even further, limiting care for patients who need it most, as providers try to interpret complicated regulatory requirements.
Medicaid managed care, run by Texas Health and Human Services (HHSC), currently serves 94% of the state’s home care population. Home care providers who contract with Medicaid managed care organizations (MCOs) are facing increased administrative costs, inefficiencies, and payment delays.
To reach these vulnerable patients, the home care industry needs updated rules that modernize care regulations and ensure uninterrupted reimbursements, for the benefit of patients across the state.
In order to simplify regulations for providers and continue quality care for patients, TAHCH recommends:
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Streamlining licensure and regulatory requirements for home care providers and increasing transparency between HHSC and home care and hospice partners, working together to support vulnerable patients.
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Improving Medicaid managed care with on-time payments and better collaboration with HHSC.
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Enabling providers to utilize cost-effective telehealth programs, when safe and appropriate for each patient’s unique needs.
Tell our regulators that it’s time to modernize home care and hospice for our patients today and tomorrow.
WORKFORCE
Home care agencies are facing a historic labor crisis. Nurses in home care make 12% less on average than hospital nurses and direct service workers earn around $9.50 an hour – both dictated by reimbursement rates set by the Texas Health and Human Services Commission, based on money allocated by the state legislature.
Low wages have created high turnover and a shortage of qualified attendants, which is increasing the cost of service and affecting the quality of care provided to patients.
For the home care and hospice industry to be able to survive the post-COVID landscape, Texas lawmakers must act decisively to raise pay rates for home care providers and include these vital workers in future funding decisions, adjusted for inflation and staying on-par with industry salaries.
In order to compete in today’s competitive health care environment and ensure home health patients have access to the best possible care, TAHCH is asking government leaders to:
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Allow for pay increases and sign-on bonuses for private duty nurses that keep pace with inflation, keeping the industry competitive in hiring talent.
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Include home care providers in statewide bonuses or raises for all other medical professionals.
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Ensure all attendants have access to wage enhancement opportunities.
Join us and let our lawmakers know that home care and hospice workers are a vital part of our healthcare continuum and deserve better.