After Dr. Javier Saenz completed his family-medicine residency in 1985, he returned home to the Rio Grande Valley to open a practice in the impoverished town of La Joya.

Today, Saenz Medical Center treats up to 150 patients a day. Dr. Saenz is the volunteer physician for the local high schools and their football teams. A middle school is named after him.

Despite his success, Dr. Saenz, 56, said he feels nothing like a hero these days. His practice, he said, is hanging by a thread.

His troubles reflect a statewide problem for doctors who treat a disproportionately high number of the reported 320,000 low-income Texans who are dually eligible for Medicare, the federal insurer of the elderly, and Medicaid, the joint state-federal health care program for indigent children, disabled people and the very poor. On Jan. 1, the state reduced its share of co-payments for such patients. Physicians who treat them are seeing less revenue. Many, like Dr. Saenz, are not sure they can make enough money to stay in business.

The Legislature directed the state’s Health and Human Services Commission last year to cut the Medicaid budget by $3 billion over two years, including savings of $475 million for this single change.

“We found that 18 other states already limit the payment for dual eligibles to the state’s Medicaid rate,” Stephanie Goodman, a spokeswoman for the commission, said in a statement. “And that makes sense on the face of it. Why would a state pay a higher rate for clients who also have Medicare coverage than it does for other clients?”

Because the rule took effect on Jan. 1, patients were unlikely to have met their deductible. And while Medicare usually pays 80 percent of the costs of services, including office visits and checkups, Texas no longer covers remaining co-pays if they exceed Medicaid rates.

Dr. C. Bruce Malone, the president of the Texas Medical Association, warned lawmakers in November that such cuts would cause physicians to stop taking both Medicaid and Medicare patients and lead to a minimum 20 percent reduction in revenue.

“The proposed rules penalize the physicians who care for the sickest and frailest Medicare patients,” he said. “They hit particularly hard practices in rural, inner-city and border Texas.”

By February, local and state medical associations said physicians with a high volume of dual-eligible patients were contacting them for help amid a cash-flow crisis.

Dr. Saenz said he also had not been reimbursed for any office visits or deductible-related procedures this year because of coding glitches. Texas health officials said they were solving the problem and that such claims will be resolved by March 30.

Ms. Goodman said her agency is sensitive to doctors’ concerns. It plans to exempt mental health services from the new limits and to increase Medicaid rates for cancer chemotherapy medications to the current Medicare rate.

Many clinics will absorb the changes. Dr. Saenz said his practice — where 80 percent of the patients rely on Medicaid or Medicare and half qualify for both — cannot. After depleting his savings, he has asked a bank for credit so he can continue to operate and make payroll.

Though he desperately needs payment from the government, he refuses to turn away his oldest patients.

”I can’t do that,” he said. “I grew up with them; they grew up with me. But if I only see them, I’m going to be out of business. So what do you do?”