Capitol Correspondence - 09.23.19

Tennessee Releases Medicaid Block Grant Proposal, Will Accept Public Comments Through October 18

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ANCOR has been monitoring efforts to block grant Medicaid through administrative means for a long time and has been voicing concerns on behalf of disability providers and the disability community for the better part of 2019 (recap here). This article from Politico Pro is a helpful resource as our members track this important discussion and the precedent Tennessee’s program might set for other states.

As written by Politico Pro:

“Tennessee today unveiled its first-in-the-nation proposal to cap federal funding for its Medicaid program and phase out the open-ended entitlement in exchange for new flexibility.

The sweeping overhaul — which still requires Trump administration approval to take effect — would apply to people traditionally covered by the program, including children, pregnant women, poor seniors in nursing homes and the disabled. Republicans in Washington, who have criticized Obamacare’s Medicaid expansion, have said it’s crucial to preserve coverage for these populations.

While Tennessee officials call the draft proposal a ‘block grant’ it diverges from that approach in crucial ways, including adjusting how much funding the state would get if program enrollment grows. Under the plan, the amount of federal money Tennessee receives will partly be calculated based on average enrollment during 2016, 2017 and 2018. For any year in which enrollment grows beyond that average, federal funding would increase on a per-person basis.


Tennessee officials also outlined a range of new authorities they want in exchange for capped financing, including the abilities to limit which prescription drugs are covered and modify rules related to uncompensated care payments to hospitals.

Uncompensated care costs would be excluded from the state’s lump-sum payment, as would costs for outpatient pharmacy services. The state would also keep half of any savings if it spends less than its annual allotment.

The state is accepting public comment through Oct. 18, after which the plan will be sent to the Trump administration. Critics have warned the approach could force major cutbacks in health coverage for low-income people.” [Emphasis added by ANCOR.]

Related information:

  • In this Politico podcast, Georgetown University expert Joan Alker reviews changes the Trump Administration has made to Medicaid and shares concerns about the Tennessee proposal.
  • University of Michigan Law Professor Nicholas Bagley questions the legality of the Tennessee proposal in this blogpost.