The TennCare Subcommittee of the Tennessee State Legislature convened on February 11, 2025, to discuss the fiscal implications and operational details of an expanded Medicaid program under the shared savings plan. The meeting focused on the potential financial benefits and challenges associated with this initiative.

The session began with a discussion on the estimated fiscal note of $234 million from the state, which is expected to leverage over $2 billion for the program. A key point raised was the division of any savings generated from the program, with a proposal to split the savings 50/50 between the state and the federal government. The implications of this arrangement were explored, particularly regarding how the retained savings could be utilized.

Chairman Bohm emphasized the importance of integrating the expanded program with the existing block grant system. He noted that if the state is already incurring costs for the expanded population, it would be prudent to negotiate for a return on those expenses through savings. The discussion highlighted that the state would contribute 10% of the costs while the federal government would cover the remaining 90%. This ratio was deemed crucial for the program's sustainability.

Concerns were raised about the potential for the state to incur losses if the savings did not exceed the 10% contribution. The possibility of the federal government restricting the expanded program's inclusion in the block grant was also mentioned, which could affect the overall financial outcome for the state.

The committee confirmed that a waiver application would be submitted to the federal government, contingent upon securing the favorable 9 to 1 federal match. This match is a standard feature of state Medicaid expansions, ensuring that the state’s financial responsibility remains manageable.

In conclusion, the meeting underscored the complexities of expanding TennCare and the necessity for careful negotiation with federal officials. The subcommittee aims to ensure that the program remains financially viable while addressing the healthcare needs of Tennessee residents. Further discussions and follow-up actions are anticipated as the waiver application process unfolds.