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 Tennessee Providers Urge Caution on Medicaid Block Grant Proposal

A $7.9 billion block grant proposal by Tennessee Gov. Bill Lee (R) to have the state’s TennCare program be the first in the nation to receive Medicaid funding in a lump sum from the federal government is drawing criticism at public hearings, media reports said.

At the same time, the state’s long term and post-acute care advocates are urging caution and close examination of how the plan would affect Medicaid recipients and providers.

The block grant would cover core medical services for the roughly 1.2 million children, adults, elderly, and people who are blind or have disabilities in the state. The federal government would raise Tennessee’s block grant funding if enrollment grows beyond what was originally calculated, advocates for the plan said.

Advocates for skilled nursing facilities and assisted living communities said changes to the current funding system need to meet certain requirements.

“The Tennessee Health Care Association and the Tennessee Center for Assisted Living [THCA/TNCAL] have been closely following the process for the development of the block grant proposal required by recent Tennessee legislation,” says Jesse Samples, executive director of THCA/TNCAL.  

The organization’s position is that any alternative Medicaid proposal must provide and ensure sustainability for the state’s most vulnerable elderly population while preserving that population’s choice to have nursing facility services or assisted living services when they are needed and appropriate, Samples tells Provider.

“While we are still evaluating the proposal, a number of items we addressed in our earlier issue brief are noted and could lead to positive changes, including a per capita spend, wage index adjustment, and protection of dual eligibles.”

However, Samples says the waiver to allow the block grant proposal by its very nature requests an unprecedented exception from existing federal regulations, some of which are designed to protect providers and beneficiaries alike from managed care practices that are detrimental to patient care.

“We certainly believe that flexibility is needed in some areas, but it must be carefully evaluated in sufficient detail to show how providers and patients will continue to be adequately protected within the Medicaid program.”

According to media reports from Nashville on Oct. 1, an estimated 30 people at a public hearing there expressed concern that the block grant proposal could compromise medical coverage and care for Tennessee’s most vulnerable citizens. Some of those speaking said the plan would be illegal, and many urged state leaders to expand Medicaid instead.

Gov. Lee has said gaining approval for the block grant proposal, which could be submitted for review by the Centers for Medicare & Medicaid Services next month, would help the state innovate, is legal, and is supported by the Trump administration.

He also said current Medicaid recipients would not lose benefits or be taken off eligibility rolls. But, groups against the plan, like the American Lung Association, that spoke at the Nashville public hearing questioned how the governor could make block grants work for those in need of care.

Opponents said as the gap between the block grant allotment and actual cost of patient care increased over time, the state would have to limit new enrollment, cut benefits, lower provider payments, or increase cost sharing for recipients.

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