TennCare Declines to Extend Enhanced Payment Flexibilities

In late May following TennCare's announcements regarding payment flexibilities, we authored a letter to TennCare requesting clarification and consideration of several items related to their announcement.  Our primary concern was, and continues to be, extending the period of enhanced payments as long as appropriate to offset the decreased revenues and increased costs providers are experiencing, but at least for the duration of the state of emergency declaration.  We interpreted TennCare's announcements to suggest that the enhanced payments were tied to the term of the state of emergency, since the payments were scheduled from March 12th, 2020 through May 12th, 2020, and Governor Lee's state of emergency declaration issued in Executive Order No. 14 was also scheduled to expire on May 12th, 2020. 

Almost immediately following TennCare's announcement, Governor Lee issued Executive Order No. 37, which among other things, extended the state of emergency from May 12th to June 30th, 2020.  It has since been extended again to August 31st, 2020.  

Yesterday, July 8th, we received a response from TennCare indicating that the enhanced payment flexibilities would not be extended.  The letter provides in relevant part: 

"Unfortunately, TennCare is not able to extend these payments for a longer period. Not surprisingly, COVID-19 has had myriad impacts on the Medicaid program and on the State’s budget. In addition to offering temporary assistance to HCBS providers, TennCare has extended funding to address other provider groups also directly impacted by the PHE, including hospitals, nursing homes, primary care providers, behavioral health providers, and dentists. In addition, there have been increased program costs associated with COVID-19 testing and treatment, significant expected new growth in TennCare enrollment resulting from the pandemic’s impact on the economy, and of course, significant impact on the overall state budget as revenue projections have been sharply revised. These have resulted in significant reductions to the previously approved FY 21 budget, and a directive to all state agencies to submit 12% reduction plans."

You can read TennCare's entire letter here.

TennCare recommended that agencies attempt to access the $15 billion set aside for eligible providers that participate in state Medicaid and Children's Health Insurance Program (CHIP). We previously publicized this opportunity to our membership.  You can read more about the relief fund here.  The deadline to apply is July 20th, 2020.   

While we were disappointed with this news, the TAHC Board will consider next steps when it convenes for its first board meeting of the membership year, next Thursday, July 16th.  Additionally, we will hold a member-wide advocacy strategy call that is currently being scheduled for the week of July 20th.