Texas could be barred from administering some of its health care programs if it does not have an operating health insurance exchange for the unemployed and underinsured that passes a 2013 federal review, said Billy Millwee, the Texas director of Medicaid on Tuesday. By 2018, an estimated 5 million Texans will be in health exchanges, which are a way for people not covered by their employers to shop for health insurance at competitive rates. Millwee said the state must begin planning how it will operate the exchanges. But state leaders need more guidance from federal health officials before they can plan a state exchange, Millwee said in a joint hearing between the Health and Human Services and State Affairs committees. Under the federal health care law, states are mandated to create the exchanges or turn the process over to the U.S. Department of Health and Human Services. I think the dilemma is that in order to be operational by the time we get ready to distribute, we really [need to] begin to start planning and design now, and thats in the absence of a whole lot of details that may come later from the federal government, Millwee said. The Texas Health and Human Services Commission and the Texas Department of Insurance are expected to release a joint study in December that will analyze the impact on Texas health care system if the state opts out of federal Medicaid or sees a severe cut in federal health funds. Texas only receives 7 percent of the national Medicaid funds, while the state has 10 percent of the national population living below poverty and a 14-percent uninsured population, said Thomas Suehs, commissioner of the state Health and Human Services Commission. The methodology for distributing Medicaid funds is fundamentally flawed, and is based on a per capita income allocation and doesnt recognize a states large poverty populations, Suehs said. State Sen. Eddie Lucio Jr., D-Brownsville, said whether the federal government takes over the states health exchanges or not, he hopes any legislation upholds a right to health care. It should be a fundamental right of every man, woman and child to be able to see a doctor or check into a hospital, Lucio said. I hope that we can come up with solutions. In a response to Lucios comment, state Sen. Jane Nelson, R-Flower Mound, said one solution is for Texans to become more aware of health concerns because the government cannot afford to treat preventable diseases.