Lawmakers take Medicaid reins; bill prevents expansion of insurance for poor without their OK

Lawmakers take Medicaid reins; bill prevents expansion of insurance for poor without their OK

March 7th, 2014 by Andy Sher and Kate Belz in Local Regional News

The Tennessee State Capitol in Nashville.

Photo by The Tennessean /Times Free Press.

Gov. Bill Haslam

Gov. Bill Haslam

Photo by Associated Press /Times Free Press.

Erlanger President and CEO Kevin Spiegel speaks with members of the Chattanooga Times Free Press editorial board Thursday.

Erlanger President and CEO Kevin Spiegel speaks with...

Photo by John Rawlston /Times Free Press.

Gov. Bill Haslam says he doesn't feel threatened by legislation passed by fellow Senate Republicans that requires him to obtain legislative approval on any deal he may cut with the Obama administration on expanding Medicaid.

"I think we said all along before we did anything we would seek the Legislature's approval," Haslam said following an economic development announcement in Dickson, Tenn. "So like I said, we didn't feel like the legislation really changed anything, and we're still continuing to pursue an answer [from Washington]."

Earlier Thursday, the Senate approved the measure requiring legislative approval on a largely partisan 23-6 vote. The House passed the bill 69-24 last month. But an amendment added by the Senate sends the measure back to the House for approval before it can go to the governor.

Tennessee hospitals have been clamoring for the expansion to 180,000 low-income mostly working adults, saying they desperately need the money because other aspects of President Barack Obama's Affordable Care Act, often called Obamacare, cuts special payments to hospitals because it assumed states would expand Medicaid.

But a U.S. Supreme Court ruling left decisions about expansion up to states. Most Republican governors have balked. Tennessee's Medicaid program is operated as TennCare, which already covers an estimated 1.2 million people.

Erlanger Health System CEO Kevin Spiegel told Chattanooga Times Free Press editors and reporters Thursday in an editorial board meeting that expansion could bring at least $35 million into the struggling public hospital.

That's money the hospital, which is spilling red ink, desperately needs.

"You can't just blame Obamacare for the next four years and watch all of the money leave Tennessee. At some point, it's not about red and blue, it's about green," Spiegel said. "And if our state is telling all this money to go to New York and California, it makes no sense. At some point, someone is going to have to step up."

Spiegel said he thinks most doctor and hospital groups won't start pushing hard for expansion until after the November elections. Too many people are afraid of a split among Republicans over the issue to make a real stand now, he said.

"But after November, they [health care providers] are all going to hold the governor accountable, because they can't endure any more cuts," he said.

Democrats charge the fact that the GOP-dominated House and now the Senate passing the bill demonstrates Haslam's fellow Republicans don't trust him and are now seeking to "tie his hands."

But Haslam said the legislation sponsored by Sen. Brian Kelsey, R-Germantown, and Rep. Jeremy Durham, R-Franklin, simply "says something we had already said. That's why when the bill came up, people said, 'Well, are y'all going to actively oppose it?' We said, no, we already said we would do that."

During Senate debate, Democratic Caucus Chairman Lowe Finney, of Jackson, and other Democrats sought to amend the bill to provide expansion dollars for veterans and people with intellectual disabilities. They failed on party line votes.

Finney warned that "54 hospitals are at risk of major cuts or even closure" without the expansion in Tennessee.

In recent weeks, he said, hospitals in Georgia and North Carolina have announced "they are shutting down or curbing services" because governors in their states refused to expand Medicaid.

Senate Majority Leader Mark Norris, R-Collierville, disputed Democrats' assertions that GOP lawmakers were embarrassing their own governor by tying his hands.

"I think it sends a message to our constituents that we're watching their money," Norris said.

Senate Speaker Ron Ramsey, R-Blountville, later told reporters the bill doesn't do more than what Haslam has already said. Kelsey's original bill would have banned Medicaid expansion but that was watered down to requiring the governor to seek legislative approval for any action through a joint resolution.

"There are some that felt more strongly that anything could happen, let's put this in law," Ramsey said.

Democrats succeeded in amending the House-passed bill with one provision. It provides that if Haslam succeeds in striking a deal with the Obama administration and calls lawmakers into special session to consider it, they'll be working on their own dime and won't be eligible for their customary daily expenses.

Haslam later said he thinks the debate "does show that there's a fairly strong feeling in the Legislature about that, obviously, on both sides. But we're going to continue to see if we can find an answer" on a way to expand TennCare.

Haslam announced a year ago he would not seek Medicaid expansion for now and instead work to get federal approval for what he calls his "Tennessee Plan," which he said would make the expansion affordable over the long haul.

The governor has never submitted a formal plan to U.S. Health and Human Services Secretary Kathleen Sebelieus. Last month, he sought to dump responsibility for a plan in her lap, telling the department to come up with something the governor can accept.

Haslam wants a plan that would allow the state to "buy" the expansion population's way onto the federal health insurance exchange in which Americans can buy coverage with subsidies based on income.

But the governor also wants special permission through a federal waiver of Medicaid rules to cut costs. That includes charging Medicaid recipients higher copays than are normally allowed under federal rules.

The federal health law provides 100 percent funding for the first three years of Medicaid expansion. By 2019 and thereafter, the federal share falls to 90 percent with the state picking up the remaining 10 percent.

Contact staff writer Kate Harrison at or 423-757-6673.

Contact staff writer Andy Sher at or 615-255-0550.