Tennessee could be the nation's first state to overhaul Medicaid funding through a special federal block grant that would split unused program funds between the federal and state government.
Tennessee Gov. Bill Lee's plan would revamp funding for TennCare, a Medicaid managed care program operated by the state, which provides healthcare for about 1.4 million Tennesseans, primarily low-income pregnant women, children and elderly and disabled people.
Under the state's hybrid block grant funding plan, Tennessee would receive federal Medicaid funding as a set amount per program enrollee, per month, according to the Times Free Press.
"This way if the numbers go up, so would what the federal government would have to pay. If they go down, the request is that the [federal funding amount] would stay the same," explained Craig Becker, president and CEO of the Tennessee Hospital Association.
With a true block grant, the government says: "Here's the money, this is all you get," said Mr. Becker.
The Nashville Business Journal reported that the state and federal government would split leftover money if TennCare spends less than the funding provided by the federal government in a given year. The governor told the Journal this would financially benefit the state — potentially through about $1 billion in additional annual funding for TennCare — based on Tennessee spending about $2 billion less on the program than projected in 2018.
Currently, any leftover money only goes back to the federal government.
But hospitals also have some concerns. For example, they would like to see the plan include some mechanism to allow physicians flexibility in prescribing medicine, said Mr. Becker.
"One thing we're talking about is if you have blood thinners and [the plan] said [the clinician] could only use Warfarin. Some people get sores in their mouth with that medicine and have to use [a different] variety. So, clinicians should be able to be allowed to put that into the medical record and say, 'Here's why I want to prescribe this other drug,'" he said.
The state is now holding a 30-day public comment period before a final proposal is submitted to the federal government for consideration Nov. 20.
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