published Saturday, February 2nd, 2013

TennCare bill gets Senate support

Tennessee Gov. Bill Haslam answers questions during a meeting with the Times Free Press editorial board. At left is Alexia Poe, director of communications for the state of Tennessee.
Tennessee Gov. Bill Haslam answers questions during a meeting with the Times Free Press editorial board. At left is Alexia Poe, director of communications for the state of Tennessee.
Photo by John Rawlston.

NASHVILLE — A bill barring the state from expanding the number of TennCare enrollees under the federal Affordable Care Act has 16 Republican sponsors, one vote shy of the 17 votes needed to pass the bill on the Senate floor.

But Senate Speaker Ron Ramsey, R-Blountville, said he wants to delay action to give Gov. Bill Haslam, a fellow Republican, more time to study the issue and see whether it makes financial sense for Tennessee to participate.

"I think we'll hold up until we get the proper data," Ramsey said, adding it "takes a lot of analyzing."

Still, Ramsey continues to voice skepticism about the expansion.

Ramsey's comments came as Sen. Brian Kelsey, R-Collierville, announced Thursday that he has 15 co-sponsors for his bill. The list includes area Republicans Todd Gardenhire, of Chattanooga; Mike Bell, of Riceville; Janice Bowling, of Tullahoma; and Ken Yager, of Harriman.

"I am pleased to have the support so far of 16 of the 33 state senators in Tennessee, and I hope to have other members sign on as co-sponsors," Kelsey said.

Haslam said in his State of the State address he feels obligated to "gather all the information possible" before making a decision on the Medicaid expansion, which the U.S. Supreme Court has left up to states' discretion.

TennCare is the state's version of Medicaid. It covers some 1.2 million low-income or disabled Tennesseans.

Meeting this week with Chattanooga Times Free Press editors and reporters, Haslam said, "We're in the middle of a process to try to research the dollars-and-cents impact as well as the health impact to Tennessee.

"Both sides think it's an easy decision," Haslam said.

Hospitals are pushing the state to agree to the expansion.

Under a trade-off the national hospital industry made with President Barack Obama, the federal government will slash billions of dollars in reimbursements to Tennessee hospitals in the next several years. Hospitals were expecting to recoup that through the Medicaid expansion and the mandate that everyone have health insurance.

But the Medicaid part is in danger of being kicked out from under them. Advocates, Haslam said, "think [expansion] is the biggest no-brainer of all time."

The federal government would pay 100 percent of the TennCare expansion for the first three years and 90 percent thereafter.

TennCare Bureau officials project nearly 182,000 Tennesseans would be eligible for the expansion.

Since the federal government would cover the increased cost for the first three years, the state's share would be about $200 million over 51/2 years. That includes nearly $95 million in the 2018-19 fiscal year.

Moreover, Haslam said, hospitals warn that if the state doesn't go along with the expansion, "we're going to have a lot of hospitals in trouble, not just the big hospitals, but these rural, 70-bed hospitals that are tottering on the edge of financial viability now."

The "flip side," Haslam said, is the state's difficulty in funding TennCare. In the mid-1990s, former Gov. Phil Bredesen kicked an estimated 190,000 enrollees off TennCare, saying the costs were unsustainable. It generated a political firestorm.

Before Bredesen acted, Haslam said, TennCare ate into state commitments for things such as higher education. Unless the state can do something to address health care costs, the threat will resurface, he said.

TennCare costs are rising substantially even without the federal health care law, he said.

"You have to question the financial wisdom of adding more to that that's already taking all the dollars," he said. He also said he's concerned about the future federal commitment given the federal deficit.

Regarding Kelsey's bill, Haslam said he's encouraged lawmakers to "let us go through a process where we research the impact on hospitals, impact on health of the individuals and we see how much flexibility the [federal government] will give us."

The governor said U.S. Health and Human Services Secretary Kathleen Sebelius last week "indicated some flexibility on some things I haven't heard before."

That includes giving states more flexibility to impose copays on Medicaid enrollees for things such as prescription drugs and emergency room visits. The state is exploring the potential impact on costs.

Such a policy would ensure "there's some skin in the game for everybody ... above 100 percent of the [federal] poverty level," he said.

Ramsey said the generous federal match might lead some to favor expanding Tenncare.

But, he said, "the federal government doesn't exactly have a good track record, whether it's education funds or whatever of sticking to those rules."

"The second part of it is a philosophical question of if they send you X number of dollars, four out of 10 of those dollars are borrowed money. And somewhere, soon, the federal government's going to have to address that," he said. "Then, suddenly, the money stops coming to the states."

The federal law calls for expanding Medicaid programs to adults whose incomes are up to 138 percent of the federal poverty line.

Even if Tennessee rejects the expansion, the program is expected to grow substantially under the federal health law. People who are eligible but haven't signed up are likely to do so when the insurance mandate kicks in next year. It's called the "woodwork effect."

Since these people are already eligible for traditional Medicaid, the feds won't give them the same generous federal match as the expansion population. The state's share is the same 35 percent it pays for other TennCare enrollees.

Officials project some 60,000 Tennesseans currently eligible but not enrolled will join over the next 51/2 years, whether Haslam and lawmakers go along with the expansion or not.

The cumulative cost is projected at $912.8 million over the period, according to TennCare projections. In fiscal year 2018-19 alone, the state's cost is $203 million.

about Andy Sher...

Andy Sher is a Nashville-based staff writer covering Tennessee state government and politics for the Times Free Press. A Washington correspondent from 1999-2005 for the Times Free Press, Andy previously headed up state Capitol coverage for The Chattanooga Times, worked as a state Capitol reporter for The Nashville Banner and was a contributor to The Tennessee Journal, among other publications. Andy worked for 17 years at The Chattanooga Times covering police, health care, county government, ...

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