Foe of Haslam's Insure Tennessee uses Corker bill to attack Medicaid expansion plan

Rep. Brian Kelsey, R-Germantown, speaks on the floor of the House during the opening session Jan. 13, 2009, in Nashville.
Rep. Brian Kelsey, R-Germantown, speaks on the floor of the House during the opening session Jan. 13, 2009, in Nashville.
photo Republican Gov. Bill Haslam presides over a meeting at the Jackson-Madison County General Hospital in Jackson, Tenn., about his proposal to extend health coverage to 200,000 low-income Tennesseans, on Jan. 21, 2015.

NASHVILLE -- A legislative foe of Republican Gov. Bill Haslam's Medicaid expansion plan is questioning its reliance on a voluntary hospital assessment that would fund the state's future share, citing efforts two years ago by U.S. Sen. Bob Corker to eliminate the widespread practice.

State Sen. Brian Kelsey, R-Germantown, was quoted by The Commercial Appeal of Memphis this week calling Corker's 2013 bill yet another reason he is against Haslam's Insure Tennessee plan to use federal Medicaid dollars to extend health insurance coverage to 200,000 low-income adult Tennesseans.

"I question whether the federal government is a reliable negotiator," said Kelsey, who then cited Corker's bill and noted it sought to "abolish the hospital tax to be relied on" in Haslam's proposal.

Haslam is trying to win approval of what he calls his "market-driven" two-year pilot project in a Feb. 2 special session of the GOP-dominated General Assembly.

If approved, the pilot project would be entirely federally funded through 2016 under President Barack Obama's Affordable Care Act.

After that the federal share would decrease over time. By 2020, the state would bear 10 percent of the costs. But Tennessee hospitals, desperate to see the coverage, have agreed to pay the state's share through expansion of an existing assessment.

That's allowed Haslam to argue that his plan -- which includes vouchers for workers to join employers' health plans and a re-tooled version of TennCare that introduces measures to control patients' costs and providers' charges -- "won't cost Tennessee taxpayers another dime."

Asked about Kelsey's assertions, Corker, a close ally of Haslam who has praised the governor's plan, said in a statement that "while I am opposed to the policy that allows states to utilize provider taxes and have introduced legislation in the past to eliminate it as part of a broader fiscal reform package, I assume governors will continue to take advantage of federal laws as they exist today."

As for whether the senator plans to reintroduce legislation eliminating provider fees or taxes at some point, Corker's office later said the senator "has no current plans to introduce stand-alone legislation to eliminate the provider tax funding mechanism."

photo U.S. Sen. Bob Corker speaks during a meeting with Times Free Press editors.

In 2013, Corker introduced a bill called the Fiscal Sustainability Act of 2013. It was a comprehensive debt-reduction bill pushing changes not only in Medicaid but in other entitlement programs such as Medicare and Social Security. It called for eliminating all health-care provider taxes or fees in 2023.

The bill, co-sponsored by Sen. Lamar Alexander, R-Tenn., went nowhere in the Democratic-controlled U.S. Senate. Republicans now control the Senate as well as the U.S. House, but Democratic President Barack Obama remains in office for another two years and likely would not allow such a measure to become law.

But if a Republican wins the White House in 2016 and Republicans still control Congress, it could be another matter.

A spokesman for Alexander, also a Haslam ally who recently welcomed the governor's plan, issued a statement that indicated more flexibility on the provider funding question.

"Congress should pass the Corker-Alexander plan, or one like it, to address out-of-control entitlement spending and fix the federal government's $18 trillion debt," spokesman Brian Reisinger said in an email. "Senator Alexander believes Gov. Haslam deserves credit for working to create a plan that Tennessee can afford, and that determining how hospitals contribute to that plan is a state decision."

Haslam spokesman David Smith emphasized that Insure Tennessee "is a two-year pilot program that automatically terminates in the event that either federal funding or support from the hospitals is modified in any way, which would also account for any federal changes."

Matt Salo, executive director of the National Association of Medicaid Directors, said the "vast majority" of states use provider taxes or fees to help fund the state share of their programs. It's legal and "very much a part of the fabric of how the program is financed," he said.

If provider fees and taxes went away nationwide, Salo said, "the program kind of unravels."

Tennessee hospitals already are providing $450 million annually to TennCare, the state's Medicaid program, to prevent state officials from cutting the program.

Craig Becker, president of the Tennessee Hospital Association, said that while he was aware Corker has been critical of the assessment, he would be "very surprised" if the senator really still wants to do away with it.

"The senator realizes the state's TennCare program relies on this assessment," Becker said.

The hospital association's offer to increase the assessment fee to help cover the state share of Medicaid expansion after the federal government decrease to 90 percent is a "9-to-1" return on investment, Becker said. "It is, frankly, the only way the state would be able to fund [expansion] at this stage in the game."

In another Insure Tennessee development Friday, House Republican Caucus Chairman Glen Casada issued a blistering denunciation of the conservative group Americans for Prosperity's Tennessee chapter after it attacked House Assistant Majority Leader Kevin Brooks, R-Cleveland, in a radio ad on the Medicaid issue.

"While I wholeheartedly agree with Americans for Prosperity's core principles and am an opponent of expanding Medicaid in Tennessee, the attack ads in districts across the state paid for by AFP are inaccurate, ineffective, and only hurts their reputation within the Tennessee General Assembly," Casada said in a statement.

The 60-second radio ad, paid for by AFP, singles out Brooks and accuses the House assistant state majority leader of "betraying" a promise to oppose "Obamacare."

Brooks said he has not made up his mind on Haslam's plan.

Casada said, "it saddens me to see AFP hiding behind the curtain and destroying their own credentials through dishonest scare tactics instead of accepting a seat at the table and discussing this important issue face-to-face."

Contact staff writer Andy Sher at asher@timesfreepress.com or 615-255-0550.

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