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Medicaid Block Grant Plan Gains Momentum in Tennessee

Tennessee legislators have approved legislation to submit a Medicaid block grant plan to the Trump administration. The bill passed last week and now heads to the desk of Governor Bill Lee, who plans to sign it, according to published reports [see Politico story]. The state now has six months to build a formal waiver request to be submitted to the Centers for Medicare and Medicaid Services (CMS). Tennessee’s move comes on the heels of news that Alaska had signaled interest in following suit [see Daily News-Minor]. Utah is also taking similar steps [see press release], to submit a waiver that is structured like a block-grant proposal, i.e., a per capita cap plan, in which the federal government would match the state’s share of costs only up to a fixed amount per beneficiary.

There is no vehicle that would permit CMS or a state to change the financing structure of the Medicaid program through a block grant [see KFF explanation]. Current law grants eligible individuals an entitlement for coverage and states are guaranteed federal matching dollars with no pre-set limit. Yet the block grant proposals under consideration in these states and being debated across the country could eliminate both the entitlement and the guaranteed match to achieve budget savings and to make federal funding more predictable.  Critics argue that such plans leave little choice for states but to slash enrollment and benefits for the most vulnerable.

NACHC is closely following these developments and will keep you posted. For any questions or concerns please contact Bethany Hamilton at bhamilton@nachc.org.

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