Tennessee on Tuesday became the first state to put forth a plan to turn Medicaid into a block grant — an idea long supported by conservatives to reinvent (some say rupture) the federal government's 50-year-old agreement with states to pay for safety-net insurance for the poor.
Here we go again. We — and the 1.4 million Tennesseans enrolled in some form of TennCare — seem destined to be guinea pigs of Republican politicians pretending to be fiscal conservatives.
Gov. Bill Lee's proposal volunteers the Volunteer State to seek a controversial federal Medicaid block grant waiver pushed by the Trump administration. Our supermajority GOP Legislature earlier this year passed a law requiring Lee to come up with such a plan. And in a nutshell, we will be the nation's first test case of how far the Trump administration is willing to go to allow a state the "flexibility" on health care "entitlements."
An explanation attached to Tennessee's grant proposal says that the state can be "more flexible" and save money. But flexibility is code for what-can-we-not-cover. More on this later.
Because Trump and the Tennessee Trumpites in our state Capitol want to erase anything that hints at the Affordable Care Act, we're going to trade in a TennCare waiver that lets the federal government off the hook for its ACA guarantee of a continuing 2-1 Medicare spending match. In its place, we'll take a block grant that forever caps the amount of federal dollars we can use for Tennessee health care.
Here's how this works. In April, the feds spent $7.5 billion (our tax dollars) in Tennessee to pay for two thirds — yes, two-thirds — of our state-provided health care. Under that ACA federal agreement, if health care costs go up for whatever reason — an increase in low-income enrollees, tornado injuries, pandemics, whatever — the federal government share must rise accordingly to cover two-thirds of the cost.
Under Lee's "block grant" arrangement, Washington will send back to us $7.9 billion of our tax dollars annually. If our costs increase, as they always have, that's for us to make up at the state level. If our costs go down (and when have they ever?) we "share" in the federal savings.
Remember: These are the same math savants who never took advantage of the federal ACA provision to expand Medicaid to cover an estimated 300,000 working adult men and women in Tennessee. Had we done that, then the federal government would have used the tax dollars we've already paid to pick up 90 percent of the cost. Repeat, 90 percent.
These are also the same math whizzes who last year pushed TennCare work requirements to save an estimated $3.6 million. Problem? The fiscal note prepared by the Legislature's Fiscal Review Committee estimated the actual price tag would include an additional $22.3 million in expenditures for case management costs (figuring out who to kick off). Minus the estimated state savings from disenrollments, based on the program starting in 2020, we'd spend an additional $18.7 million to save $3.6 million.
These also are the same tender hearts who pushed our state's administration over the past two years to drop the health insurance coverage of 130,000 low-income Tennessee children — including 5,500 in Hamilton County. That meant that during the same period when Tennessee claimed the seventh fastest growing economy of any U.S. state, we ranked No. 1 in disenrolling children from Medicaid and TennCare, leaving them without any form of insurance.
Did we mention that we also ranked 41st worst in WalletHub's "best health care systems" list and 13th lowest in health care expenditure, according to a 2014 Kaiser Family Foundation study? We also should remind ourselves that Tennessee has the 10th highest rate of medical debt in the country. The median amount of medical debt on Tennesseans' credit reports in 2016 was $739.
But wait, say the Republicans. With a new waiver, we'll have more "flexibility" to "save" money.
Ask yourselves how the state can "save" money — aside from kicking kids off of health care programs wholesale.
Here's one answer: Don't cover the drugs — or best drugs — for certain illnesses and pre-existing conditions. Under the ACA waiver, what's covered is set in stone. "Flexibility" apparently means the state can decide, with far less accountability.
Here's another answer: Excluded from Lee's proposed waiver are special federal payments to hospitals providing large amounts of otherwise uncompensated care, critical access and essential hospital payments and similar payments. Did we mention that Erlanger is the largest regional provider of care for indigent patients and includes the only children's hospital within 100 miles?
Also excluded in the new waiver proposal are people who are enrolled in both Medicare and Medicaid; services that are now carved out of TennCare's current waiver, such as those for individuals with intellectual disabilities; children in state custody; outpatient prescription drugs and administrative expenses that are not treated as medical assistance expenditures. Exactly what that means is not yet clear.
Health care advocates fear that this safety net has some big, big holes in it. Now that's some savings.