Posts Tagged ‘Justin Owen’

Attorney General: The Feds Can Change “Insure Tennessee” If They Want

Attorney General: The Feds Can Change “Insure Tennessee” If They Want

A few weeks ago, Senate Finance Chairman Randy McNally (R-Oak Ridge) requested an Attorney General’s opinion on the legality of Gov. Haslam’s Medicaid expansion proposal. The Attorney General issued his opinion this morning, and it can be found here.

The key components for those uninterested in legalese:

  • While the federal government can’t arbitrarily change the terms of any agreement Tennessee enters into with them relative to Medicaid expansion, in reality they can.

Congress can always change federal law to impose new requirements on the states when it comes to Medicaid enrollees. And even worse, the Obama administration (or any future administration) can unilaterally change its interpretation of the law. The Centers for Medicare and Medicaid Services (CMS) can also issue regulatory or policy statements that would—perhaps significantly—alter Insure Tennessee.

This is consistent with what we have been telling lawmakers: while you may think you are approving the governor’s expansion plan, you are actually relying heavily on the federal government not to alter those terms in the future. Given the feds’ track record, that proposition makes me squeamish.

  • The state can legally use the hospitals’ provider tax to fund its share of the expansion.

We’ll hear more about that today in the Senate Judiciary hearings, but even if it’s legal, as I wrote yesterday, it’s bad policy and still could leave state taxpayers holding the bag.

  • The state can legally kick people off if the program becomes too expensive or the feds change the terms in a way that is detrimental to the state.

First, this is still a point of contention, evidenced by the fact that the best proof the opinion could offer for this flexibility is a CMS list of frequently asked questions posted in the agency’s website. But even if the FAQ document serves as a legal basis to remove enrollees, any such plan to terminate the program must be approved by CMS, and other states haven’t fared so well in similar attempts.

Second, this also fails to address the political realities of kicking off somewhere between 200,000 and 400,000 enrollees. Do lawmakers really want to give that many Tennesseans a free rug only to rip it out from under them? We can do better than that.

In short, the Attorney General’s opinion verifies that this plan is wrong for Tennessee.

-Justin Owen

January 27th, 2015 | Beacon Blog, Feature, Recent News

The Medicaid Expansion Funding House of Cards

The Medicaid Expansion Funding House of Cards

Gov. Haslam is adamant that his proposed Medicaid expansion under Obamacare “won’t cost Tennessee taxpayers another dime.” That’s because the state’s share of the plan will be paid for by the state’s hospitals via an “assessment fee.” But while this may sound good in theory, the reality is much less appealing.

First off, what is a “hospital assessment fee”? In order to obtain federal Medicaid dollars, the state must first show that it has collected its share of funding locally. It’s the whole, “you put in a dollar and I’ll give you three” approach that has become customary in Washington. Rather than directly tax Tennesseans to obtain the state’s share of the funding for the proposed expansion, Gov. Haslam is asking the hospitals to pony up the money via a provider tax.

Through this provider tax, the hospitals will forward the state money, which the state will then use to draw down more federal dollars. Once the state obtains the federal money, it will then kick more money back to the hospitals via reimbursements for seeing Medicaid patients. So in effect, the hospitals will get their money back, plus much more.

State law prohibits the hospitals from passing the costs of the provider tax onto their other patients, but nothing is really illegal unless there’s an enforcement mechanism to make it so. And here, there is really no way to prevent hospitals from shifting those costs now or in the future, meaning that in the end, those hospitals’ other patients will wind up footing the bill for this expansion.

What’s worse is that this funding scheme has come under attack by Congress in the past, including by our own two U.S. senators. As recently as 2012, Sen. Bob Corker proposed ending provider taxes, and Sen. Lamar Alexander signed onto the bill as a co-sponsor. If Congress ever moves forward with a ban on these assessment fees, state taxpayers will have no choice but to step in and pick up the tab. And that tab will only grow over time, with the state’s share of Medicaid expansion rising to at least 10 percent of total costs by 2020, and we have no assurances that a bankrupt federal government will continue to pay its share into the discernable future. Even if the provider tax scheme is not outright eliminated, it has been capped in the past, and a future cap could serve to limit how much Tennessee can raise from hospitals to cover its costs, forcing the state to turn to taxpayers for the rest.

This house of cards is not the way to fund the expansion of an entitlement program to more than 200,000 able-bodied adults. While there is plenty wrong with the proposed Medicaid expansion, the funding mechanism alone should make the whole plan fall apart. State Sen. Brian Kelsey, chairman of the Judiciary Committee, will hold hearings on the provider tax tomorrow afternoon. Funding a Medicaid expansion this way warrants not only careful scrutiny, but outright objection by the legislature.

-Justin Owen

January 26th, 2015 | Beacon Blog, Feature, Recent News

Make 2015 the Year of Freedom

Make 2015 the Year of Freedom

At noon today, a new Tennessee General Assembly gavels in for the 109th time. The future is bright for Tennessee, which consistently ranks among the best states to do business, and is considered a low tax, low debt state. However, as surrounding states seek to pass bold reforms to expand economic liberty and bring relief to taxpayers, we must not rest on our laurels.

The new legislature will face a number of challenges over the coming months, with outcomes that will dramatically impact the direction of our fair state. The session will determine whether Tennessee remains the envy of our neighbors and states across the country—or whether we are eclipsed by others more committed to advancing free market principles. The following issues will take center-stage in determining which direction our state will pivot in 2015.

Medicaid Expansion: The most important decision to be made by the legislature will be whether to assist the Obama administration in cementing Obamacare as a permanent national policy, despite the fact that conservatives made substantial gains in November’s elections. With every state that takes federal Medicaid expansion dollars, it becomes increasingly difficult for the new Republican Congress to roll back or repeal Obamacare. And by partnering with the president to expand Medicaid in Tennessee, Gov. Haslam opens up a massive entitlement program to some 200,000 able-bodied, mostly childless adults.

An expansion also means an increase in Tennessee’s already heavy reliance upon federal funding—already the third highest in the country, according to the Tax Foundation. It also means longer lines for all Medicaid patients, who are already being turned away by 40 percent of doctors. Lawmakers should reject an expansion and instead seek free market reforms that will drive down the cost of healthcare, making treatment more affordable and accessible for Tennesseans in need.

Right to Try: One of the first healthcare reforms that can be tackled is already gaining steam across the nation. Known as Right to Try, this proposal would allow terminally ill patients to access potentially life-saving medication that has been deemed safe by the FDA but is still ensnared in the agency’s decade-long approval process. In fact, many of these treatments have been available in other countries for years. The sickest among us don’t have time to wait for the FDA to send these drugs to market. Lawmakers on both sides of the aisle should pass this this bill and remove the barrier between Tennessee’s terminal patients and the possibility of a cure.

School Choice: Thousands of Tennessee children remain trapped in a school that is failing to meet their needs. Every child deserves a quality education, and school choice will empower their parents to choose the school that is best for them. Nearly every problem we face as a state—poverty, crime, dependence, poor health—can be improved with a quality education. After several years of debating an opportunity scholarship program, it’s time the legislature follow the lead of nearly two-dozen other states and bring meaningful school choice to Tennessee families.

Hall Tax: While Tennesseans overwhelmingly banned an income tax on labor this past November, another tax weighs heavily on our state’s residents and prevents us from truly becoming income tax-free. Each year, thousands of middle-class retirees fork over a substantial portion of their savings to the government via the Hall Income Tax. This tax also drives investors out of our state who could otherwise help put Tennesseans back to work. And because the main proposal pending before the legislature is crafted in a fiscally responsible way, repealing the tax will have a negligible impact on state and local revenues.

These key issues—rejecting a Medicaid expansion, promoting right to try, enacting a school choice program, and eliminating the Hall Tax—are the most important things lawmakers can do during the few months they are in Nashville. Then they can return home to their districts having advanced the freedom and prosperity of all Tennesseans.

-Justin Owen & Lindsay Boyd

January 13th, 2015 | Beacon Blog, Feature, Recent News