New TennCare waiver could mean ‘whole new ballgame’ in fed funding

After six months of operating under temporary extensions, state and federal health care officials have reached a new long-term agreement on continuing federal funding of TennCare that will change the way money is distributed to hospitals in two years.

From a Modern Health Care article:

 Under the new agreement, the CMS will continue the uncompensated-care payments through June 30, 2017, at current levels, which have averaged around $500 million a year.

During a one-year transition period, the total possible payments will ramp up to $708 million.

After that, Tennessee must submit a revised methodology for distributing the money that limits the subsidies to care provided to people who wouldn’t be eligible for Medicaid if the state agreed to expand the program under the Affordable Care Act.

“Coverage is the best way to assure beneficiary access to healthcare for low income individuals, and uncompensated care pool funding should not pay for costs that would otherwise be covered in a Medicaid expansion,” Eliot Fishman, director of the CMS’ State Demonstrations Group wrote in a letter to the state in November 2015.

Tennessee hospitals are nervous about how the allocations will change. It’s “a whole new ballgame with a new distribution system of funding for hospitals,” said Craig Becker, CEO of the Tennessee Hospital Association. “We have some concerns about precisely how this will work, but we have a couple of years to work with state and federal officials to nail down details and secure needed funding for hospitals in the state.”

The CMS has increasingly resisted paying for healthcare for the uninsured now that most of them have access to coverage under the Affordable Care Act. That issue has been an obstacle to renewing waivers in other states, including California, Florida and Texas.

See also The Tennessean, HERE