TennCare Still Negotiating Waiver

The healthcare coverage for the 1.2-million Tennesseans on TennCare is on the line over an obscure accounting rule. The program received a two-week extension for its waiver which expired over the weekend.

TennCare was created on a waiver from the federal Medicaid program in the 1990s so the state could expand eligibility to more income levels. The TennCare bureau has to go back to the federal government every few years to have its program renewed, but this year, it got caught in the crosshairs of a Bush administration plan to crack down on some commonly used accounting methods.

Local governments often cover some losses hospitals incur when they care for people with no health insurance. Many states, including Tennessee, claim those dollars—called certified public expenditures–in their Medicaid programs to qualify for federal matching dollars. The Bush administration outlawed the practice in May, but Congress got a one-year moratorium so states could figure out how to make up for the shortfall.

After a year of negotiating, TennCare commissioner Darin Gordon says that late Friday, federal authorities arbitrarily decided to cap the amount of money Tennessee could get using the accounting method. He says it’s unfair.

“This is the first time this issue has ever been raised, which leads one to believe this was an effort to identify an and every way possible when dealing with the states, without violating the moratorium, they could constrict their certified public expenditures.”

Gordon doesn’t know when the issue will be resolved. But when the new waiver is approved, the TennCare bureau will re-open the medically needy category, one it closed during the dis-enrollment process in 2005.