Gov. Bill Lee says health cost reforms needed to aid struggling rural Tennessee hospitals

Tennessee Gov. Bill Lee speaks during the Tennessee Valley Corridor Summit on the campus of the University of Tennessee at Chattanooga on Thursday, May 30, 2019, in Chattanooga, Tenn. Gov. Lee gave the keynote address to the summit.

Ten rural hospitals have closed in recent years in Tennessee and at least 15 more hospitals have lost money for three consecutive years, including the only hospital in Fentress County which appears to be at risk of soon closing.

The Centers of Medicaid and Medicare Services announced this week that Jamestown Regional Medical Center, an 85-bed facility that is the only hospital in Fentress County, will be terminated from government reimbursement programs on June 12 after the hospital recently failed to pay its employees or vendors. Portions of the hospital lost power last month because a $33,000 electricity bill had not been paid.

Lenda Sherrell, state director of the Southern Christian Coalition, said Thursday the expected closing of the Jamestown Medical Center "will be a moral failure at the hands of those in power" for not expanding Medicaid eligibility or working to secure more funds available under the Affordable Care Act, or Obamacare.

"Our leaders, the public servants Tennesseans entrusted to improve, not abandon their health care needs, are watching our hospitals fall one by one," Sherrell said, noting the closing of 10 rural hospitals already acros the state. "Medicaid expansion is a resource that could help stop this crisis, yet they refuse. How many more hospitals have to close before Gov. Bill Lee and the state legislature act?"

Tennessee is one of 14 U.S. states that have not yet expanded Medicaid under the Affordable Care Act due, in part, to concerns about the additional governmental costs of such coverage. But Lee said Thursday his administration has begun talks with the federal government about a possible block grant approach to Medicaid funding that could both expand coverage and be more cost effective than the current system.

"We have already begun conversations with federal officials about how we can improve access to quality health care for every Tennessean," Lee said during an appearance Thursday at the Downtown Rotary Club in Chattanooga. "We have established a health care modernization task force that will be working over the next year to bring forth new ideas."

Lee told Rotarians that the current health care payment system is too costly and inefficient and he is eager to identify better ways to improve health care at less cost.

"We are pulling together leaders in health care - payers, providers and patients -to find a path forward for Tennessee for a system that will resolve some of the challenges of what I think is a broken system," Lee said.

In his first State of the State address since being elected last November, Lee tasked Finance and Administration Commissioner Stuart McWhorter with establishing and chairing a task force that will "work closely with private sector stakeholders, policymakers and communities across the state to develop a list of reforms and critical investments."

"We want to address the rising cost of health care, which is really what contributes to the closure of rural hospitals," Lee said. "We're working really hard to come up with innovative and creative ways that we can provide more access. That will be the goal of the healthcare modernization task force over the next several months and we'll be coming out with suggestions, ideas and policy as a result of that."