Lee vows to pursue Medicaid block grant but not accept one 'that would be bad for Tennessee'

Democrat says 2019 was 'worst session in recent state history'

The Tennessee state capitol building is located in Nashville, at the intersection of Charlotte Avenue and 7th Avenue North. It occupies the highest point in Nashville, a hill once known at Cedar Knob. The structure was designed by architect William Strickland who is buried at the north façade of the capitol building. state capitol tennessee house of representatives / Getty Images

NASHVILLE - Gov. Bill Lee says he's "grateful" that fellow Republicans in the Tennessee Legislature approved his school voucher-style program and also vows he won't accept a "bad" deal when it comes to another bill directing him to negotiate with Trump administration officials on a federal "block grant" for the TennCare program.

The Republican governor also defended his signing a controversial voter registration bill into law on Thursday, immediately spurring a federal lawsuit filed by the NAACP and other critics.

On yet another front, Lee said he would sign into law another controversial last-minute bill creating a new concealed-only carry handgun permit.

It does away with current provisions requiring would-be licensees to complete an eight-hour firearms course with actual use of a gun followed by an exam. The new National Rifle Association-backed law simply requires applicants watch a 90-minute video and pass an online exam.

"I will sign that bill," Lee said.

The governor's comments came Thursday night after the Republican-led 111th General Assembly wrapped up its annual session following a daylong marathon session. It led at one point to a brief walkout by furious House Democrats who were locked out of a second conference committee on the TennCare bill after House and Senate Republican majority conferees were unable to strike a deal.

Proponents believe turning the federal funding for Medicaid into a lump sum payment with fewer federal strings will transform the state's health care program for 1.3 million lower-income, elderly and disabled residents for the better.

Democrats and other critics charge the block grant would wreak havoc in a vital $12.1 billion safety net program where the federal government provides $7.5 billion.

Flanked by beaming top GOP House and Senate leaders at a news conference where Lee and fellow Republicans took a victory lap, the governor, who took office in January, called it "a great privilege to work with these leaders to advance what I believe a positive movement for this state.

"We have done things that are meaningful for Tennessee," the businessman and political outsider told reporters.

Asked about his whittled-down education savings account program, which would steer about $7,300 in state and local tax dollars to parents of up to 15,000 children to pay tuition for private schools and related expenses, the governor said "I'm grateful that we got it done.

"The children of Tennessee, or simply those who are going to qualify for this program, are going to have access to a high quality education that they didn't have access to before. And for me that's success enough," Lee added. "I'm grateful for that."

The final version excludes Hamilton and Knox counties and now applies only to Metro Nashville and Shelby County schools, plus the state's Achievement School District for failing schools.

Meanwhile, Metro Nashville and Shelby County school leaders are threatening to sue the state over it. If that happens, it would mean a second major lawsuit following Thursday's legal action by the NAACP which is already drawing national attention.

Lee's administration, meanwhile, is playing down another legal controversy over Lee and Republican lawmakers' effort to exclude undocumented immigrant students from the education savings account program through requiring parents to submit certain types of documentation to participate.

The administration and GOP proponents say the information such as a tax return and W-2 form are necessary to help auditors ensure parents are using the money properly.

But Sen. Todd Gardenhire, R-Chattanooga, a longtime school voucher proponent who has championed educational opportunities for undocumented children, blasted the move and voted against Lee's amended bill. Gardenhire and other critics said it was intended to keep out the students.

Medicaid block grant controversy

While the ESA plan came from Lee, the Medicaid waiver proposal came from GOP lawmakers. Lee nonetheless bought into it. He sought to reassure enrollees, legislative critics as well as a dozen top national patient groups including The American Cancer Society and American Heart Association and American Lung Association, that the program will be in safe hands.

"We would never negotiate a deal with the federal government that would be bad for Tennessee," the governor said. "This will allow us the ability to negotiate, to pursue a, really a correction to a system that's broken."

"It does not work well and we want to create a system that does in our state and that lowers the cost of health care for Tennesseans."

Calling it an opportunity to negotiate the block grant with the federal government, Lee said "we'll only do it if it's a good deal for Tennessee, it's a good deal for our state, if it protects the things that we want to be protected. And that will happen in that negotiation process or we won't [seek to] get it approved."

With dozens of bills yet to reach his desk, Lee also said doesn't see any candidates for a veto.

House floor blowup

House Democrats, meanwhile, are still seething over Republican leaders having jammed the block grant bill through the chamber Thursday night as well as their treatment by Republican House Speaker Glen Casada of Franklin.

Things went quickly went south as Casada named a new conference committee on the Medicaid block grant bill after senators and representatives deadlocked in the first panel. Rep. Yusuf Hakeem, D-Chattanooga, served on the first panel as did Senate Minority Leader Jeff Yarbro, D-Nashville.

Knowing they would be outvoted, the two were preparing to write a minority report which could be offered on both chambers' floors along with the majority report. Both Democrats planned to recommend lawmakers approve expanding Medicaid under the federal Affordable Care Act, which Republican leaders as well as Lee oppose.

House rules are silent on minority reports. But minority reports are specifically cited in Senate rules so long as at least one member from both chambers sign it. By keeping Hakeem off the second conference committee, Democrats who thought they might get support for Medicaid expansion from Republicans, were thwarted in their efforts.

And they were furious with most Democratic members trying to walk out of the House chamber. Which at that point would have left Casada without the required 66-member quorum necessary to conduct business in the 99-member chamber. While Republicans have 74 members, a mass Democratic exodus could have brought proceedings to a crashing halt because a number of Republicans as well as some Democrats had been excused by Casada from attendance.

Getting wind of the effort, Casada ordered the sergeants at arms to lock the chamber doors. Outside the chamber, Rep. Jason Powell, D-Nashville, angrily demanded the doors be opened, saying it was a violation of state fire codes.

Meanwhile, there was a scuffle as Rep. G.A. Hardaway, D-Memphis, sought to force his way through.

Asked by a Daily Memphis reporter what had happened, Hardaway told the news site "I don't know. I heard a lot of commotion, somebody grabbed me around the neck."

A video supplied by Republicans appeared to show Hardaway shoving one sergeant at arms.

Enough Democrats did leave, proceeding to the legislative library where they lambasted Casada and complained about the sergeants at arms being used against them, questioning its legality.

However, Republicans cited House Rule 20 which says that "in case a less number than the quorum of the House shall convene, the Speaker is hereby authorized to send the Sergeant-at-Arms, or any other person or persons, for any or all absent members."

Meanwhile, inside the chamber, the House was left in limbo as Republican leaders called missing GOP lawmakers and demanded they return. They did and there was a subsequent quorum call with exactly 66 members present, enough to start doing business.

The second conference then passed 63-19 with a Democrat abstaining.

Deputy Speaker Matthew Hill, R-Jonesborough, later said there will be an ethics investigation into whether Hardaway acted inappropriately.

At the later news conference, Casada said "I did not physically restrain" anyone. "I did not block the door. I had the sergeants at arms start the process of locking the doors so we could all sit down and do the people's business.

"Obviously some members want to shirk their constitutional responsibilities. So I stood in the back of the room and said don't leave. That is what I did."

Opposing views of 2019 session

Democrats earlier held their news conference with Sen. Yarbro and House Democratic Caucus Chairman Mike Stewart of Nashville, blasting both Lee and GOP leaders.

Calling it "at the very least the worst session in recent state history," Yarbro noted three out of every four dollars spent by Tennessee goes toward education and health care.

"And on both of those priorities, Gov. Lee's first session was a gigantic step in the wrong direction," Yarbro said.

He said Lee's "signature legislation takes money out of public schools and puts them in private schools.

Addressing the Medicaid block grant waiver, Yarbro said Tennessee is "at the bottom when it comes to life expectancy and rather than do something like expanding Medicaid, they passed a hyper-partisan bill to move towards block grants that we all know will lead to people losing health care."

Stewart predicted Lee's ESA bill "is going to be a gaping fiscal wound, starting out for Nashville and Shelby County." He argued it will eventually hit other school systems "and they are going to be bled dry by the ESA bill. We'll look at it as the worst vote this legislature has made in decades."

He said Republicans' stepping up to the Trump administration's effort to push Medicaid block grants "puts us at the forefront of the most backward and ridiculous states when it comes to heath care."

Lee and Republican leaders later held their own news conference.

Senate Majority Leader Jack Johnson, R-Franklin, called it a "historic" session, noting among other things that Lee proposed a $38.55 billion budget that was unanimously approved.

It puts $200 million-plus into the state's Rainy Day Fund, bringing the emergency reserve fund to $1.1 billion, Johnson said.

"It cuts taxes, and it prioritized the needs of our citizens and it was a budget we could be proud of," Johnson said, adding lawmakers added their own priorities and "tweaked it a little bit. The governor proposed a great budget and we feel we made it even better."

He said he believes "the citizens of Tennessee can be proud that we were good stewards of your tax dollars."

Calling 2019 a "phenomenal year," House Majority Leader William Lamberth, R-Portland, applauded Lee, saying he recommended a legislative package that boosted education spending and also "reset our sights back on vocational education" and started a "real foundation for criminal justice reform.

He said "all of our House members - Republicans and Democrats - we do have spirited debates. We do have stark differences sometimes in the way we look at these issues. But everyone on this stage and each member of this chamber truly believes in the greatness of this state.

"I think we can all agree that it's been a very successful year," Lamberth added.

Contact Andy Sher at asher@timesfreepress.com or 615-255-0550. Follow him on Twitter @AndySher1.