How is new TN Medicaid expansion plan different?

Now that Tennessee’s state legislature has released another proposal for Medicaid expansion in the state, health insurance consumers may be wondering two things: How is this plan different from Insure Tennessee, and will any of these proposals actually get implemented?

The newest plan, the product of House Speaker Beth Harwell’s 3-Star Healthy Task Force, prioritizes veterans and those with mental health needs. However, in order to be enacted, it needs both federal approval from the Centers for Medicare and Medicaid Services and state approval from the legislature.

Beth Harwell task force pitches TennCare expansion plan

But how is this concept different from previous TennCare expansion plans, and how did Medicaid expansion become a Tennessee issue in the first place?

Expanding Medicaid through the ACA

First, what exactly is Medicaid? It is a federal program that provides health coverage to certain groups of people, typically those with low incomes or disabilities. Expanding the program to more people goes back to the Affordable Care Act. The 2010 health reform law expanded federal eligibility for Medicaid to anyone making up to 138 percent of the poverty level.

States also have their own eligibility requirements for Medicaid. In Tennessee, Medicaid eligibility applies only to children, pregnant women, caretakers of children, women with breast or cervical cancer, and those on disability or in a nursing home.

Medicaid expansion has always been voluntary for individual states, but at first, the federal government attempted to incentivize states to do so by withholding federal Medicaid dollars if they did not expand their programs. However, the Supreme Court decided in 2012 — using an argument presented by Vanderbilt Law School professor James Blumstein — that states could opt in or out of Medicaid expansion without jeopardizing their existing funding.

Thirty-two states have since opted in to the expansion, either as written in the ACA or by developing their own expansion plans, which have to be approved by the federal government. This is what Tennessee has attempted to do.

Insure Tennessee

The first attempt to expand Medicaid in Tennessee was a plan presented by Gov. Bill Haslam in January 2015.

Insure Tennessee: A recap of Haslam's health-care plan

The plan had two parts. The first was called the Volunteer Plan, which covered a portion of an individual’s health insurance premium. The other plan, called the Healthy Incentives Plan, applied to those making between 100 percent and 138 percent of the poverty line. Those consumers would have to pay lower-cost premiums and copays for health-care services. The program also created incentives for consumers who visited primary care providers or used the emergency room responsibly.

Insure Tennessee did not garner enough support to pass, even after two separate votes.

3-Star Healthy Task Force

In the period after Insure Tennessee failed to pass, a number of proponents, including hospital and religious groups, continued to push for Medicaid expansion. In April 2016, a task force created by Harwell began meeting to discuss health-care access and improvement in the state.

The task force held meetings across the state and discussed options such as expanding charity care for low-income patients and improving behavioral health care.

The result of the task force is this new plan — which doesn’t yet have a name — announced on June 30. Under the first phase of the plan, consumers up to 138 percent of the poverty line would either need a mental illness diagnosis or proof of honorable discharge to sign up for expanded Medicaid.

If the first phase goes well, in phase two, anyone up to the income threshold could sign up for the program. The plan would also encourage patients to find primary care physicians and seek mental health treatment.

Future unclear

Despite the release of another plan, Medicaid expansion in Tennessee is a continued struggle. To actually implement the plan, the state would first need approval from CMS, which isn’t guaranteed — the federal government prefers that states expand Medicaid without restrictions to who can sign up.

Then, the bill would have to get through Tennessee’s own legislature, which has declined to expand Medicaid twice already. It is not clear whether this new plan will have any better luck than Haslam’s previous attempts.

Alex Tolbert is the founder of Bernard Health, a company that provides non-commissioned, expert advice on health, Medicare and COBRA insurance and medical bill consulting. To learn more, visit www.bernardhealth.com.