A study from the Robert Wood Johnson Foundation (RWJF) shows that Tennessee could see a decrease in state spending if Medicaid coverage is expanded.
According to the study, most non-expansion states “would increase state spending under expanding,” however this is not the case for Tennessee.
“Tennessee’s spending will decrease slightly by 0.1 percent because the state has one of the highest parent eligibility thresholds among non-expansion states at 82 percent of FPL (federal poverty level).”
The study also estimated that more than 300,000 people would enroll in Medicaid and CHIP (Children’s Health Insurance Program) and that the expansion could lead to a decrease in the rate of uninsured people by 27 percent.
“Some would be newly eligible enrolled while others would come from the healthcare marketplace and others would transition from more expensive employer-sponsored insurance to Medicaid,” said the study.
The philanthropic health organization conducted research on the 10 states that have opted to not expand Medicaid programs. Among the 10 states are Tennessee, Mississippi, and Alabama. According to the foundation, the states have not expanded their eligibility under the Affordable Care Act.
“Under the Affordable Care Act, states have the option to expand Medicaid eligibility to non-elderly people with incomes up to 138 percent of the federal poverty level,” reads the executive summary of the study. “Governors, legislators and other stakeholders in many of the non-expansion states are actively debating Medicaid expansion.”
In 2012, the Supreme Court of the United States ruled that while Americans are required to have affordable health insurance coverage, the decision to expand coverage lies within the state. Tennessee has opted to not expand.
According to the Tennessee Justice Center, which advocates for improved health care and economic policies for families, there are “$1.4 billion of federal tax dollars per year in Washington” allocated for the state to use.
“Thanks to the American Rescue Plan’s incentive, our state could also receive an additional $900 million over two years ($1.2 million per day) over and above the cost of expanding coverage,” said the organization.
While the study does not include a state-by-state analysis, it did say that expansion would also reduce uncompensated care in Tennessee. The study cited information from the Tennessee Hospital Association saying that state hospitals “provided $1.1 billion worth of uncompensated care in 2021 for the underinsured and uninsured.”
This has also led to a number of rural hospital closures in the state.“Tennessee has experienced 16 hospital closures, with 13 of those being rural, since 2010 — the second highest rate in the United States. Of the 95 counties that make up the state, 82 percent are rural,” said the Tennessee Hospital Association.
Former Tennessee Governor Bill Haslam pushed for Medicaid expansion starting in 2013, however the state Senate blocked Haslam’s proposals.
There are lawmakers such as Representative Caleb Hemmer (D-Nashville), who have openly advocated for Medicaid expansion. Following the release of the study, Hemmer took to his X (formerly Twitter) account to not only share highlights of the report, but to express his support of expansion.
“It’s passed (past) time we did it in Tennessee,” said Hemmer. “ A dirty little secret is Tennessee expanded Medicaid because of the COVID waivers recently and @TennCare did a great job managing the same populations that we would through traditional Medicaid Expansion. Now, the working poor who would benefit are starting to get disenrolled.”
Hemmer’s tweet references the Medicaid continuous coverage rule, which ended in March of 2023. Under this rule, states could disenroll people from Medicaid. The state had previously been prohibited from doing so due to a nationwide pause on this policy as a result of the COVID-19 pandemic.
