Updated at 12:55 p.m.
Gov. Bill Haslam is rejecting the federal government’s offer to pay for more people to receive Tennessee health care coverage on the state’s TennCare program but said he is instead researching a third alternative.
The option, which he said he is still working on, would use the federal dollars to buy private health insurance for some 175,000 low-income people, complete with co-pays.
“This isn’t the end of the story,” Haslam told reporters after breaking the news before a joint-session of the General Assembly that he would reject federal funds to expand TennCare right now. “We do think the Tennessee Plan, as I call it, is the right idea.”
For a full copy of the governor’s speech click here.
The program would sunset after a certain period of time, giving the legislature power to renew it or close the program down. His plan, as conceived, would also revamp the payment structure for providers so they are compensated for health outcomes, not just services performed, he said.
The announcement Wednesday effectively delays movement on any program, likely until at least next year, rejecting dollars extended under the Affordable Care Act to states to expand the state’s Medicaid rolls under the state’s TennCare program.
Democrats, who have been urging the governor to expand the Medicaid program, contend the governor’s announcement “delivered a ‘no’ dressed up as a year of delayed action and indecision,” according to a press release.
“This is a time when the people of Tennessee need clear, precise and bold leadership, and Governor Haslam offered none of that today,” echoed Rep. Mike Turner (D-Old Hickory), the House Democratic Caucus chairman. “It’s a failure of our moral obligation to protect the health and welfare of the most vulnerable among us. It’s a failure that will be paid with the lives of the working poor in our state — this is quite simply shameful.”
Republicans, many of whom clapped when the governor announced he would not expand Medicaid, said they are satisfied with Haslam’s decision.
“Governor Haslam offered a good solution, rather than expanding an unsustainable and broken program,” read a statement from the Senate Republican Caucus. “Hopefully, Washington will see our 20-year record of working through the problems we face with our healthcare system and agree to work with us on a plan that will truly be both beneficial to improving healthcare outcomes in our state and sustainable over the long run.”
Under the so-called Obamacare program, the federal government would cover the full cost of Medicaid coverage to Tennesseans up to 138 percent of the poverty level, equal to income of $32,000 for a family of four. The federal government would cover the full costs covered for three years, then scale back to paying 90 percent of the price tag in 2020.
Currently, the TennCare health coverage is largely limited to children of low-income families, pregnant women, the elderly and the disabled. Roughly 1.2 million people are now on the state’s TennCare rolls.
While the governor said he “fundamentally” believes people having health care coverage is better for citizens and the state than people not having coverage, he said he couldn’t stomach the idea of adding more people to the TennCare rolls then kicking them off when the federal government began to scale back how much it contributed.
“The whole idea of just take it for three years and cut the rolls just never felt right to me,” he said.
Haslam said his administration is still working with the U.S. Department of Health and Human Services to determine if Tennessee can work out its own plan.
The Tennessee Hospital Association, which has advocated for an expansion of Medicaid, said it is behind Haslam’s alternative health care plan and hopes the federal government can give the state the necessary approval to move forward soon.
“We are hopeful we will get the necessary assurances from the federal government that will allow the Governor to pursue the vision he outlined this morning and there can be a special session of the legislature in Tennessee to take advantage of the 100 percent federal funding available this year,” said THA President Craig Becker.
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