Report: Uninsured Tennesseans would drop 27% with Medicaid expansion

Staff photo by Olivia Ross / On Thursday, Gov. Bill Lee speaks during a Rotary Club meeting in Chattanooga. Lee is among the Tennessee officials who are against expanding Medicaid because they believe it would end up costing the state additional money.
Staff photo by Olivia Ross / On Thursday, Gov. Bill Lee speaks during a Rotary Club meeting in Chattanooga. Lee is among the Tennessee officials who are against expanding Medicaid because they believe it would end up costing the state additional money.

An estimated 151,000 Tennesseans would gain health insurance coverage — reducing the state's uninsured population by 27% — if Tennessee followed in the footsteps of 40 other states and Washington, D.C., by expanding Medicaid, according to a report released Monday.

Tennessee's Medicaid program, TennCare, covers mostly low-income pregnant and postpartum women, parents or caretakers of a minor, children and certain older adults and people with disabilities. Medicaid expansion would open TennCare eligibility to nearly all adults under 65 years old whose household income is up to 138% of the federal poverty level, which for an individual amounts to $20,120 annually in 2023.

Tennessee is among 10 states — including Alabama, Georgia, Florida, Kansas, Mississippi, South Carolina, Texas, Wisconsin and Wyoming — that have not elected to expand Medicaid under the Affordable Care Act — an option that first became available in 2014.

(READ MORE: 10 Medicaid holdout states scramble to improve health coverage)

The uninsured population in those 10 states would drop by 25% — or 2.3 million people — if those states fully implemented Medicaid expansion, according to the report, which was conducted by the Urban Institute with support from the Robert Wood Johnson Foundation.

Georgia would see a 27.9% reduction in uninsured, or 293,000 people, according to the report.

Groups with the highest gains in coverage due to Medicaid expansion include non-Hispanic Black people, young adults and women, particularly women of reproductive age, according to the report.

"Research has documented that this additional health coverage has decreased mortality and increased the financial security of beneficiaries while benefiting hospital finances," the report's authors state. "When additional sources of revenue and savings are considered, many expansion states have found that they saved money on net."

Gov. Bill Lee and other expansion critics in Tennessee have said in the past that the Affordable Care Act is "fundamentally flawed" and argued that Medicaid expansion could wind up costing the state more money.

(READ MORE: Tennessee Speaker of the House Sexton pours cold water on Medicaid expansion proposal)

By expanding Medicaid, Tennessee would receive $1.4 billion annually from the federal government. While states have costs associated with expansion, Tennessee's overall spending with expansion would decrease by 0.1%, because Tennessee has one of the highest parent eligibility thresholds (82% of the federal poverty level) of the remaining holdout states, the report said.

Medicaid expansion also improves hospital finances by reducing uncompensated care costs, the report said. Roughly 45% of Tennessee hospitals were at risk of closing following one of the worst financial years in recent history, according to a report commissioned by the Tennessee Hospital Association that was released in February.

Throughout the pandemic, TennCare enrollment surged by more than 25% because the federal government temporarily paused the required annual renewal process for Medicaid coverage during the public health emergency. Enrollment has fallen each month since the state resumed renewals in April, with at least 147,180 enrollees deemed no longer eligible through the end of July, according to the most recent data from TennCare.

The report's estimates account for the renewal process and anticipated changes in health insurance enrollment overall, Matthew Buettgens, a senior fellow at the Urban Institute's Health Policy Center, said in a phone interview.

To estimate Tennessee's uninsured population with Medicaid expansion, researchers looked at data from other states where Medicaid expansion has occurred, Buettgens said. After expansion, roughly about 73% of people who gain eligibility enroll in Medicaid, he said.

"It's possible with better outreach that a higher rate could enroll in Tennessee. But also, there are people who are currently eligible who aren't enrolled, and that will continue," Buettgens said. "There's never 100% enrollment of eligible people."

The uninsured population also comprises people who make too much money to qualify for Medicaid and are not enrolled in a commercial plan as well as people who are not eligible for Medicaid due to their immigration status, he said.

Contact Elizabeth Fite at efite@timesfreepress.com or 423-757-6673.

Upcoming Events