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VOL. 7 | NO. 14 | Saturday, March 29, 2014

Haslam’s Medicaid Expansion Talks Continue

By Bill Dries

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Tennessee Gov. Bill Haslam has walked a fine line since announcing a year ago that the state would not accept federal funding for an expansion of TennCare, Tennessee’s version of Medicaid, at least for now.

There’s certainly been no false optimism about his attempts to work out a unique arrangement with federal officials. He’s never described an agreement as imminent or said the talks were making any kind of substantial progress.


But Haslam has also been careful to criticize the concept and particulars of the Affordable Care Act, not the people running the health care reform act who are on the other side of the bargaining table.

He’s also said he will seek approval from the Tennessee Legislature if he is able to reach any tentative accord with the federal Department of Health and Human Services.

But a year into his search for an alternative, the middle of the political road on the issue is proving to be tough ground to hold.

The latest proof is approval in the state House and state Senate in March of a bill that requires the legislature’s approval of any deal Haslam and federal leaders might make.

The Republican sponsors of the legislation, including state Sen. Brian Kelsey of Germantown, have said the requirement reflects the sentiment of their constituents to have as little to do with the Affordable Care Act as possible.

Haslam acknowledged the sentiment in the Republican supermajorities in both chambers early in his quest for a separate deal for Tennessee, and he’s continued to do so frequently since then.

“Most of us in this room don’t like the Affordable Care Act,” he said a year ago in the State of the State address in which he announced his decision. “But the decision to expand Medicaid isn’t as basic as saying, ‘No Obamacare, no expansion.’”

In an op-ed piece for The Tennessean newspaper earlier in March, state Senate Democratic leader Jim Kyle of Memphis said opposition among Republican lawmakers to the Affordable Care Act has dominated the discussion of the expansion.

“All we have heard is that they don’t like the Affordable Care Act,” Kyle wrote. “That’s not a policy, it’s not a principle, and it’s not a response to the reality facing our state.”

But Haslam’s frustration with the lack of any significant movement in his talks with federal officials came to the surface late last year, when he acknowledged he had asked Health and Human Services Secretary Kathleen Sebelius to at least make a counteroffer to his call for the federal funding to subsidize private insurance with wellness incentives and programs as part of the arrangement.

During a January interview on the WKNO-TV program “Behind The Headlines,” Haslam referred to the Affordable Care Act as “a clunker” in which the Medicaid expansion is offered “free for a while, then you have to pay for it.”

“What I’d like to do is do what they should have done in the beginning,” he said. “Have Medicaid where it truly has incentives for better outcomes for healthier lives on both sides – for the users and for the provider.”

Former Gov. Phil Bredesen, who called for and presided over cuts in the TennCare rolls that Haslam cites as a possibility as federal funding for the expansion lessens, has said he believes Haslam should take the federal funding. But speaking to the Economic Club of Memphis in February, Bredesen added that he believes there is a deal to be made.

“The feds want us to do it badly enough that they will negotiate some things to have protections,” Bredesen told The Economic Club of Memphis. “I think what has happened is a sort of hatred of the president, and Obamacare has clouded people’s vision a little bit.”

Bredesen himself has been a critic of the Affordable Care Act, but from the outset of Haslam’s decision has urged the governor to take the Medicaid expansion funding, which costs the state nothing for the first three years and becomes 90 percent of the total funding in the second three-year period. The $1.4 billion would mean TennCare coverage to an additional 140,000 Tennesseans.

Former governor and current U.S. Sen. Lamar Alexander, who is also a critic of the Affordable Care Act, has not offered advice on the expansion to his fellow Republican currently in the governor’s mansion.

“There’s one governor at a time, and I’m not it,” Alexander said during a March 20 stop in Memphis. “I understand Gov. Haslam’s caution in expanding Medicaid, because from the time I was governor, Medicaid was 8 percent of the state budget. Today, it’s 30 percent of the state budget. Any governor is going to want to study carefully expanding a program that grows that fast and soaks up money that otherwise would be going to keep tuition down at the University of Memphis or community colleges.”

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