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Bredesen-Era TennCare Lawyer Recommends Legislature Demand Final OK on Medicaid Expansion

Haslam’s negotiating position enhanced if lawmakers play ‘bad boy,’ says Vandy law prof

A health-policy advisor to a Democratic former governor said Tuesday that the Republican-run General Assembly should get the last word on whether to approve any deal the current governor strikes with the feds on Medicaid expansion.

“Legislative oversight is a critical part of the decision whether to expand coverage under the Affordable Care Act,” James Blumstein, a constitutional law professor at Vanderbilt University, said during a state Senate Judiciary Committee hearing.

Prof Blumstein January 2015Blumstein was Gov. Phil Bredesen’s legal expert on TennCare during the program’s most tumultuous period a decade ago.

“I can say from the experience of 10 years ago that it is excruciatingly painful to ask people who have something to give that up,” Blumstein said in reference to the Bredesen administration’s decision to remove about 170,000 lower-income Tennesseans from the state-administered Medicaid system.

Republican Gov. Bill Haslam is now proposing the state take more than a billion dollars in additional federal Medicaid funding to use for financing private-insurance vouchers for 200,000-400,000 lower-income Tennesseans.

Legislators are scheduled to focus next week on whether to grant the governor authorization to implement a federally financed Medicaid-expansion pilot-program through the Patient Protection and Affordable Care Act, otherwise known as Obamacare.

Haslam’s plan, dubbed “Insure Tennessee,” must be OK’d by both the U.S. Department of Health and Human Services and state lawmakers in Nashville. But just who gets final say on the plan’s approval — the Legislature, the governor or the Obama administration — is likely to be a key subject of discussion in the special session that starts Monday.

Blumstein generally commended Haslam for his administration’s ongoing efforts toward crafting a Tennessee-specific proposal that doesn’t simply swell the rolls of TennCare, the state’s Medicaid program.

Obamacare or Not Obamacare?

The governor and his Medicaid-expansion supporters have argued that “Insure Tennessee” isn’t really Obamacare. Haslam claims “Insure Tennessee” is a “different program” than the Affordable Care Act because it contains provisions like cost-containment incentives both for patients and health-care providers.

Blumstein agreed that Haslam’s proposal is “different from the traditional expansion of Medicaid.” He also noted, though, that while the governor’s Medicaid expansion offering is “a careful and thoughtful proposal,” it still “fits within the rubric of the Affordable Care Act.”

“It is different (than Obamacare), but it also fits within that legal framework,” said Blumstein.

Just how closely “Insure Tennessee” comports with the Affordable Care Act is one of the basic questions that lawmakers, particularly Republicans, are grappling with as they prepare to launch their special session.

All the GOP lawmakers in the Tennessee Legislature voted last year for the “Stop Obamacare Act,” which is the law now requiring the governor to seek the General Assembly’s approval for the Medicaid expansion deal. That legislation was initially drafted as a blanket prohibition against Medicaid expansion. It was later amended to grant the governor room to haggle with Washington on the issue, although GOP leaders didn’t think the Obama administration would allow Tennessee the leeway to take federal money and run Medicaid expansion its own way.

In his testimony Tuesday afternoon, Blumstein alluded to sharp divisions within the GOP as the special session looms. He allowed that expanding Medicaid isn’t necessarily for everybody — especially those who favor confrontation over compromise on the controversial health care reforms passed four years ago without any Republican support in Congress.

“If one really has a broad strategy of defeating the ACA, and seeking its repeal or significant watering-down, then you would not move forward (with Medicaid expansion),” he said.

The other approach is to “take advantage of the ACA and the opportunity that it provides to expand coverage,” Blumstein said.

He lauded the governor for being “shrewd” in his negotiations with the federal government, saying he has “used his leverage strategically to include financial incentives and disincentives.” However, Blumstein said specifics ought to be better nailed down before state lawmakers agree to sign off on any federally financed health-coverage expansion deal.

One of the key sticking points for Republican lawmakers who’re entertaining the possibility of granting their blessing to the deal is whether the state can quit the expansion experiment without endangering funding for the existing TennCare population. Tennessee’s attorney general, former Haslam administration chief legal counsel Herb Slatery, issued an opinion Monday indicating that he thinks the law is on the state’s side to do that if officials so choose.

However, Blumstein said the Legislature should demand enforceable contractual assurances from the federal government in that regard.

Legislature Should Embrace ‘Bad Boy’ Role

“The key issue for the Legislature is how best to participate in this process,” Blumstein said.

He believes the General Assembly should “signal support” to Haslam on his Medicaid expansion plan. But “final approval is premature” at this time, and “not prudent from a strategic point of view,” said Blumstein.

In fact, Blumstein said the governor’s negotiating position will actually be strengthened if there’s certainty that the Tennessee General Assembly gets the last up-or-down vote on whatever end-of-the-day deal the Haslam and Obama administrations reach.

“It is important for the governor to be able to have a ‘bad boy,’ to be able to say, ‘I have got to be able to persuade my Legislature on this,'” Blumstein said. “And the deal that Tennessee gets will be a lot better if the state Legislature doesn’t sign off at this point, but gives some encouragement and approval, but then holds off until all the i’s are dotted and the t’s crossed, and then the Legislature can move in at that point.”

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