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TENNESSEE’S MEDICAID BLOCK GRANT PROPOSAL
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Federal officials have approved Tennessee’s proposal to block grant Medicaid, and Tennessee’s legislature voted one week later to authorize and move forward with the plan.
Here’s why it matters:
The block grant creates incentives to cut TennCare and use the resulting “savings” for other parts of the state budget. The proposal hinges on the ability of the state to generate massive savings, but it’s impossible to simultaneously achieve significant health savings and maintain or increase access to healthcare coverage, especially because they tout how lean our program already is. The state has an abysmal track record hoarding money intended for Tennesseans in need. This takes away accountability and gives them even more money to mismanage.
There is no commitment to cover any additional people or any additional benefits. Any comments outside of the proposal that claim it will cover more people are not reflected in the proposal. The promise that no enrollees or benefits will be cut is empty because they can (and have) erected administrative barriers for enrollment, redetermination, and authorization of services. The proposal allows the state to arbitrarily deny access to some prescription drugs for serious and costly illnesses, like cancer and hepatitis. This proposal gives the state less oversight and accountability over billions of taxpayer dollars.
The block grant is a political gimmick, not a serious answer to Tennesseans’ real health concerns. The proposal makes no mention of the pandemic or rural health and hospital closures. TN’s urgent healthcare needs deserve serious attention and real action from political leaders:
- The state’s handling of the COVID-19 pandemic has led to one of the worst outbreaks in the world;
- TN is losing rural hospitals at a faster rate than any other state;
- TN’s loss of health coverage for kids is among the worst in the nation;
- Hundreds with addiction die because they are uninsured and cannot afford treatment;
- One third of TN adults have pre-existing conditions and face the loss of affordable coverage if the TN Attorney General succeeds in his effort to strike down the Affordable Care Act.
The block grant leaves money on the table that could be used to really improve our healthcare system. There is a better way to really address Tennessee’s urgent healthcare priorities without seeking a risky and damaging block grant that no other state is foolish enough to want. 37 other states (plus DC), led by governors and legislatures from both parties, have tapped federal funds to expand Medicaid to working families. Former Gov. Bill Haslam proposed his Insure Tennessee plan but was blocked by the legislature. Such a plan would bring in $1.4 billion/year of new federal funds to address health priorities and give 300,000 Tennesseans the health coverage they need.
The “savings” aren’t guaranteed. The shared savings of the proposal depend on the state meeting 10 quality metrics that have yet to be selected or approved. No one has been able to beat medical inflation trends, and we are already starting from a very low base of per enrollee spending (the base CMS approved is much lower than what Tennessee submitted), so savings are contingent on drastic cuts. Compare this to the guaranteed $1.4 billion a year that our state could unlock if they accepted federal dollars to provide coverage to 300,000 more Tennesseans. Expanding Medicaid would provide a lot more money and it’s a tried-and-true program, compared to the block grant. As the proposal is now, there is a booby trap that could devastate the state budget later down the road when the base is recalculated.
Our state legislators have turned a blind eye to the serious threat it creates for our state by voting to approve the block grant waiver with little time for deliberation. There are still major questions about its impact and making such drastic changes on a multi-billion-dollar health insurance program that provides care to 1.4 million people during an unprecedented health pandemic is dangerous. It may even prevent us from ever expanding Medicaid at the 90% match. The outgoing administration created new procedures that could make it more difficult for the Biden administration to withdraw CMS approval.
- Bill passed in the legislature. In late May, the legislature passed a bill directing Governor Lee to submit a proposal to the federal government asking to convert the state’s current Medicaid program (called TennCare) into a “block grant.” The bill specified that the governor needed to submit this proposal within 180 days.
- The state comment period began on Sept. 17 and ended Oct. 18. On Sept. 17, the legislature unveiled the block grant proposal which had been crafted by TennCare behind closed doors. The release of the draft proposal started a mandatory 30 day public comment period. Throughout the fall, Governor Lee and federal officials went on a massive educational tour about the block grant proposal in an attempt to convince Tennesseans that the block grant would be a good thing for their communities and families.
- November: Tennessee state officials submitted a revised version of the proposal to the federal government. From the day before Thanksgiving to the day after Christmas, the federal comment period for the new proposal occurred. The federal government is required to consider all public comments before approving the proposal.
- 6,124 comments were submitted to the federal government for consideration during the federal comment period. An overwhelming majority of those comments opposed the block grant.
- Just days before a new administration will take office, CMS officials have approved Tennessee’s Medicaid block grant waiver. In just a week’s time, Tennessee’s 112th General Assembly voted to authorize and move forward with the plan.
April 22, 2021
- Thirteen Medicaid beneficiaries, represented by the National Health Law Program, the Tennessee Justice Center (TJC), and King & Spalding LLP, filed a complaint in the US District Court for the District of Columbia challenging the Department of Health and Human Services’ approval of the TennCare III project through the end of 2030. A copy of the complaint can be accessed here.
Our state’s Medicaid block grant proposal has been approved by the Centers for Medicare and Medicaid Services, despite contradicting CMS’s own block grant guidance to states, encouraging states to apply for Medicaid block grant waivers only for the Medicaid expansion population. Our state legislature passed legislation to make the state apply for the waiver, and that legislation requires legislative approval before the block grant is accepted. Just one week after CMS announced their approval of Tennessee’s plan, the 112th Tennessee General Assembly voted to authorize the block grant plan.
On April 22, 2021, Thirteen Medicaid beneficiaries, represented by the National Health Law Program, the Tennessee Justice Center, and King & Spalding LLP, filed a complaint in the challenging the Department of Health and Human Services’ approval of the TennCare III project through the end of 2030. The lawsuit was filed on behalf of TennCare enrollees with chronic, disabling conditions, a pediatrician practicing in a rural part of the State, and TJC. The Plaintiffs argue that in its haste to approve the project, the Trump administration did not provide the required public comment period, depriving them of the opportunity to voice their objections to the project. They also claim that HHS exceeded its authority and acted in an arbitrary and capricious manner when it authorized the project as a Section 1115 experimental waiver.
The bottom line is that any block grant encourages Medicaid cuts and will hurt more than 1.5 million vulnerable Tennesseans. So we’re fighting it.
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WHAT THE EXPERTS SAY
See who opposes this harmful proposal!
Experts agree that Medicaid block grants pose dire threats to our healthcare system and vulnerable individuals. The nation’s most respected patient advocacy groups oppose block grants as a threat to patients, and the Washington Post warned that Tennessee is about to sabotage its own health care system.
Thank you for submitting 6,124 comments to the Centers for Medicare and Medicaid during the federal comment period! Follow us on Facebook, Instagram, and Twitter for updates on the Medicaid block grant proposal.