Will Tennessee (Or Florida) Now Follow The “Lead” Of Arkansas — Allow Medicaid Money To “Buy” Private Insurance?

Even though the Tennessee legislature has a bill pending (of supsect constitutionality under the Supremacy Clause, according to the Tennessee AG) to prevent the sale of private insurance products via the exchanges under the ACA of 2010, and Gov. Haslam (R) won’t run a state exchange, I’ve long suspected that the Governor will have to find a politically expedient way to allow a form of Medicaid expansion to enter the state (for Tennessee’s neediest citizens) — while not appearing to have broken campaign promises, to oppose the ACA of 2010.

Enter what I’ll dub the “Arkansas Compromise” — as approved by HHS Secretary Sebelius this afternoon — per Bloomberg — do go read it all:

. . . .The Centers for Medicare and Medicaid Services announced the compromise in an e-mail four days before the debut of state insurance exchanges created under the Affordable Care Act. The plan may cost the federal government as much as $1.1 billion in its first year. The health law sought to have states expand existing government-managed Medicaid programs for the poor next year to cover everyone earning about one-third more than the U.S. poverty level.

While the federal government has pledged to pay the entire expense of the expansion until 2017, some Republican-led states balked. The Arkansas program, in which insurance companies will be given the Medicaid money to manage plans for new enrollees, may serve as a template for Iowa, Ohio, Michigan and other states that had been weighing options.

“It represents a way to do a Medicaid expansion without it looking like Medicaid,” said Matt Salo, the executive director of the National Association of Medicaid Directors. “That in and of itself makes it a very, very attractive option for states that are currently in the ‘no’, or ‘unsure’ or ‘leaning no’ columns. . . .”

The Obama administration has said it will approve a limited number of expansions using private plans, without saying exactly how many. Under terms of the arrangement, the expansion can’t cost the federal government any more than it would to expand the traditional state-run Medicaid program. . . .

Note that the Arkansas compromise allows a Democratic governor to mollify the Republican controlled Arkansas State legislature — granting yet another “back door” Medicaid expansion route. Might this be the bit of wiggle room Governor Haslam needs, to handle his own version of the ACA of 2010 Catch 22?

We will — as ever — keep you posted.


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