Health Care Compact Bill Fails in House Committee

Legislation setting the stage for a state take over of Medicare and other health care programs from the federal government failed in a House committee Tuesday with four Republicans joining Democrats to vote against it.
The vote on the Health Care Compact Act (HB536) came out as a 9-9 tie in the House Insurance and Banking Committe, which means the bill was defeated under House rules. A similar measure failed on the House floor in the last hour of the 2012 legislative, getting 45 of the necessary 50 votes with several Republicans absent or abstaining.
Last year, no Republican voted against the bill. On Wednesday, however, House Finance Committee Chairman Charles Sargent, R-Franklin, led a round of critical questioning of the measure and its sponsor, Rep. Mark Pody, R-Lebanon.
“This scares me to death,” said Sargent at one point, contending the measure opens the door for Tennessee to lose funding from the federal government for TennCare and Cover Kids, a program providing health insurance for children in low-income families.
Both those programs are operated by the state with most the funding coming from the federal government, which also imposes many rules. The bill envisions the federal government turning over other programs as well – including Medicare but not including veterans health care – and nonetheless giving states federal funds along with all management responsibilities.
Sargent asked Pody what the federal matching rate for those two programs is currently and whether it would change. Pody did not know, but the bill makes no policy decisions and separate enabling legislation would be adopted in future years if Tennessee moves to a takeover.
Sargent said the state now gets $3 federal for each state dollar in Cover Kids, a rate more favorable than most states, and roughly a $2 for $1 match in TennCare.
“If it does nothing like you say, why are we putting something on the books?” said Sargent, saying the state could simply send a letter to federal officials or adopt a legislative resolution petitioning. “We’re going open-ended into something not knowing what we’re doing.”
Pody said passage of the bill would give the state “as many options as possible” for dealing with health care in the future. He repeatedly stressed that specifics would be left to further legislation and the state could withdraw from the compact later. Nine states have passed legislation to join a Health Care Compact.

Note: This updates and replaces previous post.

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