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Member Research & Reports

Member Research & Reports

Vanderbilt: Health Policy Expert Explains TennCare Block Grant Proposal

Tennessee has made an “opening bid” in its negotiations with the federal government about a block grant that could significantly change how TennCare functions for more than 1 million children and low-income individuals, and making sense of the complex proposal can be tricky.

In a new article in the New England Journal of Medicine, Dr. Melinda Buntin, Mike Curb Professor of Health Policy and chair of the Department of Health Policy at Vanderbilt University Medical Center (VUMC), explains the key provisions of the proposal the state has put forward to change its Medicaid program.

Dr. Buntin explained that Tennessee’s TennCare program already incorporates much of what other states might seek through a block grant.

“Tennessee is essentially asking for an increase in its federal funding in return for the risk of accepting a fixed amount for the bulk of people currently enrolled in the program,” she said.

Dr. Buntin wrote that while the move is viewed as precedent setting, Tennessee already operates TennCare on a waiver program — known as an 1115 waiver — that allows it some flexibility, and the state already spends less than what the federal government disburses each year.

The financial aspects of the state’s proposal are favorable for the state. Specifically, the state wants to get more money and keep more of what they “save” in operating the TennCare program. Tennessee also wants to be excluded from the lump-sum federal contribution elements that create the most risk and cost — like prescription drugs, beneficiaries eligible for Medicare and Medicaid, payments to safety-net hospitals and new enrollees — that could dramatically increase the burden to the state in the event of a recession, an epidemic or new, expensive treatments.

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