It’s unlikely that proposals to expand TennCare will gain momentum this year, despite a $900 million federal incentive offered in President Joe Biden’s stimulus package.
Doug Kufner, a spokesperson for House Speaker Cameron Sexton, said Wednesday that Sexton does not see a future for such a proposal in the lower chamber.
“The speaker believes any type of expansion proposal inside Tennessee does not have the support it needs to pass in the House,” Kufner said.
Tennessee is one of 12 states that has not expanded its Medicaid program, TennCare. Expansion would offer coverage to individuals who earn too much to qualify for TennCare but too little to afford other health insurance coverage.
Biden’s stimulus package passed earlier this month offers states that have not expanded Medicaid a big financial incentive to do so. Under the American Rescue Plan stimulus, Tennessee would receive a $900 million bonus over two years if the state expands Medicaid.
“Speaker Sexton understands the federal government is dangling funding in front of states as part of the American Rescue Plan to entice them to expand Medicaid,” Kufner said. “However, the White House is only offering two years of funding, which leaves our taxpayers on the hook to cover additional costs once these federal dollars disappear. Policy decisions should never be made based upon government incentives.”
The Affordable Care Act, passed during the Obama administration, offers federal funding for states to expand Medicaid to all adults earning incomes under 138% of the poverty level — about $17,600. About 250,000 uninsured Tennesseans would become eligible for government-paid health insurance coverage if the program were expanded in this state, according to analysis by the nonpartisan Sycamore Institute.
Proposals from both sides of the aisle — including Gov. Bill Haslam’s Insure Tennessee proposal in 2015 — have been rejected by the General Assembly. Those who oppose expansion often cite the long-term costs the state would incur as a result. While the federal government would cover 90% of long-term costs, Tennessee would continue to be responsible for 10%.
Lt. Gov. Randy McNally, R-Oak Ridge, has said he is open to taking another look at the issue in light of the new incentive, but remains concerned about the associated long-term costs.
“Lt. Gov. McNally believes the proposal is one that should be studied. While the broad strokes have been released, the details still need to be fleshed out,” Adam Kleinheider, a spokesperson for McNally, said in a statement. “Before the state can make any decision about how to proceed, more information about what flexibility would be offered and how an expansion would interact with our block grant is needed.
“Any consideration of expansion would need to start with a discussion of how to preserve the flexibility included in that waiver.”
Earlier this year, Tennessee received federal approval for a new funding structure for TennCare, known as a “block grant,” that gives the state more flexibility in administering the program. Sarah Tanksley, a spokesperson for TennCare, confirmed there is nothing in the state’s block grant waiver that prevents the state from expanding the Medicaid population.
In a news conference Tuesday, members of the Democratic caucus called on Gov. Bill Lee to make Medicaid expansion a priority.
“Bill Lee and the GOP supermajority have officially run out of excuses,” Nashville Democratic Rep. John Ray Clemmons said. “Gov. Bill Lee needs to stand up and say this makes sense in every respect, dollar sense and common sense. … This political climate requires leadership on the first floor of the Capitol to say this is what needs to be done.”
Democratic leader Jeff Yarbro, D-Nashville, also supports expansion.
“We really risk becoming a genuine outlier, as states like Alabama, Wyoming or Texas and Florida start moving in this direction,” he said. “We, as a health care capital of the country, are trying to run a market that is radically different than the rest of the country.”
A 2018 poll by Mason-Dixon Polling & Research Inc. found that 63% of Tennesseans support expanding Medicaid.