Haslam says no to Medicaid expansion, hopes for ‘third way’

Haslam says no to Medicaid expansion, hopes for 'third way' (Image 1)

Tennessee Gov. Bill Haslam ended months of suspense Wednesday morning by saying he won't expand the state's Medicaid program as part of President Obama's health care law.

Haslam said he will pursue what he calls a “third way” to provide medical coverage for 175,000 uninsured low-income Tennessee.

“We are all too familiar with all of the federal rules and restrictions that prevent us from operating the [Medicaid] program as efficiently as possible,” the governor told a joint session of lawmakers.

“A pure expansion of Medicaid – expanding a broken system – doesn't make sense for Tennessee, either. That's why I have been working toward a third option,” Haslam continued.

In short, the governor's plan would use the federal money to subsidize private insurance for low-income Tennesseans, but the federal government hasn't accepted that proposal.

The governor indicated he will continue working for some kind of approval from the Centers for Medicaid and Medicare Services (CMS) which oversees the federal health care money.

Expanding the state's Medicaid program, which is known as TennCare, had been estimated to cover roughly 140,000 of Tennessee's nearly one million uninsured residents and bring in more than a billion dollars in federal money.

While the Republican-dominated legislature applauded when the governor said “no” to the Medicaid expansion, the small minority of Democrats had disdain.

“We left a billion dollars on the table to insure upwards of three hundred thousand Tennesseans,” said House Democrat leader Craig Fitzhugh.

Health care providers say Haslam's decision means some hospitals might close with thousands of jobs lost, but they hope some kind of agreement can still be worked out between Tennessee and CMS, the federal agency overseeing Medicaid money, to cover uninsured Tennesseans.

“I think CMS is anxious to get states like Tennessee who have been on the fence for awhile to get on the expansion program,” said Craig Becker who heads the Tennessee Hospital Association.

“So I think there is a willingness to work through these things, it's just a question about how they go about doing it, you can't do it in 2-3 days,” Becker added.

It means the path to the governor's “third way” may take awhile.

Read more on the Governor's Remarks on our Web site.

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