Metro Health warns loss of Medicaid 1115 waiver reserves will cut diabetes, oral-health and prevention programs

Metro Health officials told the Community Health Committee on Oct. 23 that the department faces significant fiscal stress if the Medicaid 1115 waiver reserves lapse at the end of the current burn rate in September 2026.

Dr. Claude Jacob, director-level staff at Metro Health, and Marjorie White, assistant director for the Community Health and Safety Division, outlined how the waiver and related charity-care reimbursements have supported an array of prevention and clinical programs. Jacob said the waiver reserves currently account for about $8 million of Metro Health's grant funding this year and support over 80 staff across eight program areas; those reserves are projected to expire at the department's current burn rate by the end of FY2026.

White described the department's diabetes prevention and control program in detail and the effect of the funding loss: for fiscal 2026 the diabetes program budget is about $1.6 million; without the waiver it would be left with roughly $465,038 in FY2027, a 72% reduction. White said the program's staffing complement of 12 would be reduced to three funded health program specialists if the waiver funding is not replaced. She warned the reduced budget would cut the department's workshop capacity by approximately 60%.

Metro Health's diabetes program provides free prevention and self-management workshops, conducts 60'70 workshops per year, and runs several curricula including the Diabetes Empowerment and Education Program, the CDC's PreventT2 program, the "Diabetes Garage" curriculum for men, and a new youth program called Project POWER. White said the department conducted 65 workshops in fiscal 2025, enrolled 562 community members, and saw an 80% completion rate among enrolled participants. The insulin assistance program, launched with city council funding and a contractor relationship with HEB pharmacies, served 1,445 individuals and covered 3,102 insulin prescriptions at an average city contribution of $64.47 per prescription.

Jacob and White underscored that grants and reserves have historically provided about half the department's operating budget and that the waiver's end will ripple through oral health, STI control, the Healthy Neighborhoods and Stand Up teams, violence prevention supports, clinic operations and underlying administrative functions. Jacob said Metro Health used vacancies and internal reallocations to limit immediate layoffs during recent budget adjustments but called the current situation a continuing fiscal fragility that requires contingency planning.

Committee members asked about options. Multiple council members urged stronger collaboration with Bexar County, health systems and nonprofit partners and suggested exploring shared-service models, joint grant applications and creative funding sources. Jacob said Metro Health is engaging partners and running a multi-phase "MetroHealth Moving Forward" initiative that includes staff support, retraining, skills-gap analysis and scenario planning.

Metro Health also noted a partial mitigation mechanism: participation in the state's public-health provider charity-care program has allowed Metro Health to recoup some costs (the department reported roughly $1.2 million in reimbursements tied to programs supported by the waiver in the prior fiscal year). Jacob said those reimbursements provide relief but will not fully replace the waiver reserves.

Metro Health offered no personnel action items for the committee at this meeting; the presentation was informational and Metro Health plans to return with additional program-level briefings on oral health, Healthy Neighborhoods and other initiatives during the winter and next year. Council members said they will continue to explore general-fund strategies, carry-forward options and partnerships to blunt the impacts on services.