Gov. Haslam Pursues Medicaid Expansion, Setting Stage For Upcoming Battle In The Legislature
Gov. Haslam with supporters as he unveils a plan to pursue federal Medicaid dollars under the Affordable Care Act. Credit: Governor's Office.

Gov. Haslam Pursues Medicaid Expansion, Setting Stage For Upcoming Battle In The Legislature

Gov. Haslam with supporters as he unveils a plan to pursue federal Medicaid dollars under the Affordable Care Act. Credit: Governor's Office.
Gov. Haslam with supporters as he unveils a plan to pursue federal Medicaid dollars under the Affordable Care Act. Credit: Governor’s Office.

Gov. Bill Haslam unveiled a plan on Monday to pursue federal Medicaid expansion dollars to provide health coverage to more Tennesseans. The proposal comes a year and a half after the governor rejected the funds while his administration devised a Tennessee-specific plan.

One key reason Haslam is touting the plan is that the Tennessee Hospital Association, not state taxpayers, will pay for the percentage of the program not covered by the federal government. It’s an arrangement that has not been tested in other states.

Under President Obama’s healthcare law, the federal government covers the entire cost of the program for the first three years — and there’s about 18 months remaining — and from there, at least 90 percent of the program is paid for federally.

Craig Becker, who heads the hospital association, whose members include 130 hospitals statewide, said the expansion will help drop the cost of uncompensated care, which he said has saddled many hospitals with debt. “It made no sense for us not to go ahead and agree to do this,” Becker said.

Big hospitals chains, like locally-based Hospital Corporation of America and Community Healthy Systems, have been championing Medicaid expansion, and through the association, they’ve been lobbying the governor’s office to accept the federal funds.

Tony Smith of East Nashville is among the hundreds of thousands of Tennesseans expected to be covered if the legislature approves the plan. He said his monthly disability check has put him over the income limit to receive TennCare coverage. And he falls in a coverage gap because he makes too little to receive a subsidy on the federal health insurance exchange. Smith called on legislators to put aside politics and consider how turning down the plan would affect people like himself.

“I would tell them just to think what if one of their family members was struggling. Would you want to help them out? I’m not looking for no handout,” Smith said. “I just need some help. I can stand on my own two feet once I get the help.”

Tennesseans who make less than $16,000 annually, and families that make less than $32,000, could qualify for coverage. Becker said around 400,000 residents qualify, but the governor’s office says they expect some 200,000 Tennesseans to sign up.

The plan, known as Insure Tennessee, proposes to give low-income residents vouchers to buy insurance in the private marketplace. The vouchers would cover out-of-pocket expenses, like co-pays and premiums. Alternatively, residents can sign up for a “healthy incentives plan” that will reimburse members for some healthcare costs through a redesigned component of TennCare.

Haslam said he’ll convene a special session of the Tennessee legislature in January with the hopes of getting lawmakers to sign off on the deal — a process that’s expected to trigger a political fight. Already some conservative activists are attacking Haslam’s plan.

In a statement, Justin Owen of the Beacon Center of Tennessee called the expansion proposal “unaffordable and immoral.” A separate release from Americans for Prosperity claimed that the group plans on lobbying lawmakers to reject the deal. “Hybrid plans in other states have proven to be little more than expansion by another name, and our volunteers plan on engaging aggressively, as that is likely to be the case here in Tennessee,” according to AFP’s statement.

The Haslam administration is still distancing itself from the Affordable Care Act by saying that the expansion was devised by Tennessee leaders, not by federal officials. But some political watchers have called such posturing “political jujitsu.”

“There’s a lot of trying to say they’re not doing Obamacare so that they can call it something different,” Diane Rowland, a health policy expert of the Kaiser Family Foundation told the Washington Post. “They’re trying to put some distance between the straight concept of a Medicaid expansion so they can build a coalition in the legislature.”

The U.S. Department of Health and Human Services has given Tennessee a verbal go-ahead on Haslam’s plan, but state officials have not yet submitted an official waiver to the department.

Reporter Blake Farmer contributed to this report. 

Bobby Allyn

Bobby Allyn is a reporter with WPLN. Reach him at ballyn@wpln.org
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