A committee composed of Tennessee lawmakers has submitted documents to the federal Centers for Medicare and Medicaid Services (CMS) in preparation for requesting a waiver to expand the state’s Medicaid program in two phases, with full expansion contingent on the financial stability of an initial pilot phase.
The pilot phase would extend eligibility to more than 120,000 veterans and people with mental health and substance abuse disorders with incomes of up to 138 percent of the federal poverty level (FPL). Federal funding would cover 65 percent of the costs, and the state would cover 35 percent.
If the pilot program’s actual costs prove true to the plan’s projections, the state would expand Medicaid eligibility to include all those earning up to 138 percent FPL, approximately 350,000 people. Phase 2 could qualify for, but would not necessarily receive, the enhanced federal match rate for Medicaid expansion under the Affordable Care Act, in which the federal government pays 90 percent of the costs and the state pays 10 percent.
Each phase of the Medicaid expansion plan would require recipients to share the cost of premiums and copays to stay enrolled.
The 3-Star Health Task Force, appointed by state Speaker of the House Beth Harwell (R-Nashville) and chaired by state Rep. Cameron Sexton (R-Crossville), submitted plan measurements and benchmarks to CMS for review on September 23. The committee has not submitted a waiver application.
Task force members expect the legislation to be brought to a vote before the 2017 General Assembly by the end of February. If approved by state lawmakers and CMS, the pilot program would start enrolling new members on July 1, 2017.
Uncertain Budget Impact
Sexton says the federal match rate for the plan’s second phase could hinge on who occupies the White House in 2017.
“Phase 2 could be at an enhanced federal match level,” Sexton said. “The presidential election could impact the funding mechanism, so the exact match could change with the November election. Phase 1 would be the standard match that Tennessee receives for its Medicaid program.”
Doubts Plan’s Chances
State Sen. Mark Green (R-Clarksville) says the task force’s plan is unlikely to earn the legislature’s approval.
“I honestly do not feel Phase 1 has a chance in this legislature,” Green said. “The plan is simply a phased approach to implementation of Obamacare. It still causes the federal government to spend money it does not have. If we as a state want to add veterans and behavioral health, we should just pay for it ourselves, taking it from our budget surplus.”
State Sen. Kerry Roberts (R-Springfield) said he “simply cannot imagine Phase 2 garnering the support to pass.”
Approving Medicaid expansion would require many lawmakers to break promises to their constituents, Roberts says.
“Of the 28 Republicans in the Senate, an overwhelming number campaigned on a platform opposed to Obamacare and Medicaid expansion,” Roberts said. “To vote for any kind of expansion will be contrary to the promise they made to voters to fight against Washington [DC’s] attempt to expand a fatally flawed and financially insolvent bureaucratic nightmare.”
Cost Control Concerns
Lindsay Boyd, director of policy at the Beacon Center of Tennessee, says the plan’s cost controls could prove insufficient, regardless of whether the plan receives the normal 65 percent federal match rate or [the Affordable Care Act’s] higher rate.
“We applaud the task force’s efforts to be creative with what states can do under a traditional match without expanding the program using dollars authorized through the [Affordable Care Act],” Boyd said. “However, we have concerns about the lack of details thus far regarding how the state plans to pay for their share, whether or not they’ll actually have the authority to kick individuals off the program once they’re enrolled, and the crowding out of our state’s most vulnerable from receiving access to the diminishing number of physicians willing to see Medicaid patients.”
Sexton says the task force continues to develop its plans for health savings accounts (HSAs) and cost-sharing in the proposal.
“We are currently working on the details of the HSA-like accounts as well as cost-sharing components of the pilot program,” Sexton said.
Adding to the National Debt
Green says Medicaid expansion increases a national debt already posing a great danger to the next generation’s economic future and national security.
“Obviously, it will increase the debt of our nation as the omnibus bill passed as Speaker [Paul] Ryan took office keeps us in deficits for the next 10 years,” Green said. “The impact is a huge cost to taxpayers, and worse, it is becoming a security issue. Currently, the finance charges alone we pay China on our debt buys them the equivalent of an aircraft carrier fully loaded with planes every year.
“We have to get our financial house in order, or we will destroy the living standard of our children and perhaps put national security at risk,” Green said.
Jordan Finney ([email protected]) writes from Boise, Idaho.
Marcus Rech, “Tennessee Senate Unanimously Approves Medicaid Opt-Out Program,” Health Care News, The Heartland Institute, May 2016: https://heartland.org/news-opinion/news/tennessee-senate-unanimously-approves-medicaid-opt-out-program
“TennCare Overview Document,” Division of Health Care Finance and Administration, March 2016: https://www.tn.gov/assets/entities/tenncare/attachments/TennCareOnePager.pdf
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