Haslam: Feds Offering More Flexibility on Medicaid Expansion

By Eric Schelzig, Associated Press
NASHVILLE, Tenn. — Gov. Bill Haslam wants more answers from the federal government before he decides whether Tennessee should expand its Medicaid rolls as part of the national health care overhaul. But his Republican colleagues in the Legislature may not let him get to that point.
Republican bills before both chambers would prohibit the governor from pursuing an expansion to TennCare, the state’s Medicaid program.
Haslam told reporters last week that the maneuvering in the Legislature hasn’t stopped him from closely evaluating the prospect of taking up the federal government on increasing eligibility to 138 percent of poverty.
“Our job is to go do the homework, make a decision and make our case,” Haslam said.
“We’re going to weigh the costs to the state, the impact on health care and the impact on hospitals,” he said. “I feel like we owe it to the citizens to do that.”
Haslam said conversations with U.S. Health and Human Resources Secretary Kathleen Sebelius have revealed that Tennessee could be granted some breaks on benefits for the estimated 145,500 people would be added to the TennCare rolls under an expansion.

“She indicated some initial flexibility on some people that were 100 percent of poverty and above, on some things like pharmaceutical costs and emergency visit room costs, that we had not heard before,” he said. The federal government would pay for all of the increased costs under the expansion for the first three years, and phase down its share to 90 percent after that — still well above the average 60 percent share it currently covers for Medicaid.
Former Democratic Gov. Phil Bredesen, who in 2005 cut about 170,000 adults from TennCare amid escalating costs, applauded Haslam for taking his time in making a decision.
Bredesen said when Tennessee was preparing to join the State Children’s Health Insurance Program, his administration got the federal government to agree to a cap on enrollment so the initiative wouldn’t grow out of control.
“We didn’t just have to do what TennCare did, which was take everybody who applied that met the qualifications,” Bredesen said. “I don’t think it’s inconceivable that we could negotiate something like that, and begin to make these programs just a little more controllable.”
Bredesen said that given the right amount of flexibility, Tennessee shouldn’t pass on a windfall of federal health care dollars.
“I’ve just tried to tell conservative friends of mine that you’ve got to separate your feelings about the Affordable Care Act or the president from what’s best for the state,” he said.
Skeptics abound in the hallways of Legislative Plaza.
Senate Speaker Ron Ramsey, R-Blountville, said he doesn’t believe the federal government will be able to keep its promise of paying no less than 90 percent of the costs.
“Do we get sucked into this because they’re paying all, and three years down the road it’s only 70 percent?” he said. “I don’t know what’s going to happen.”
Ramsey says he also worries that that the federal government will have to borrow more money to reimburse the states’ Medicaid costs.
“It’s a catastrophe waiting to happen when they borrow four out of 10 dollars,” Ramsey said. “I don’t want to be so far out there that we can’t back out.”
Democrats have filed their own bill seeking to require Haslam to agree to a Medicaid expansion, though the move is largely symbolic given that supermajorities Republicans hold in both chambers.
House Minority Leader Craig Fitzhugh, D-Ripley, said Republicans are being disingenuous when they say the state shouldn’t pursue Medicaid expansion over concerns that the federal government won’t be able to meet its obligations.
“Remember, 40 percent of our state government (money) comes from the federal government,” Fitzhugh said. “So if we’re leery of that, we need to be super-leery.”
As for the Republican bill to ban any participation in Medicaid expansion, at least one co-sponsor is willing to hold the measure in check until the governor reveals his position.
“It needs to lay dormant until he not only decides, but justifies it to the people of Tennessee and to the General Assembly,” said House Republican Caucus Chairman Glen Casada of Franklin.

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