Tennessee’s request for Medicaid funding to treat COVID-19 patients appears to be on life support as the federal government looks to the CARES Act to distribute billions of crisis dollars to state governments.

Gov. Bill Lee said early this week his administration is awaiting a response from the Centers for Medicare & Medicaid Services on its Medicaid waiver request, which would have brought $105 million into the state to pay for COVID-19 treatment for uninsured residents. The money was to be placed in a safety net fund and distributed to hospitals to pay their costs for treating uninsured patients suffering from COVID-19.

Governor still seeking Medicaid expansion for COVID-19 patients

TennCare spokeswoman Sarah Tanksley said Friday, April 10, that CMS is putting its emphasis elsewhere. Tennessee is set to receive about $2.7 billion in CARES Act money.

“CMS has informed us the federal government is presently focused on the CARES Act as a mechanism to address the costs of the COVID-19 treatment for the uninsured. We are awaiting further federal guidance around the CARES Act funding distribution and continue to remain hopeful that the federal government will partner with us. As Gov. Lee has said, we are committed as a state to doing what we can to address this issue.”

Lee’s office did not respond to email questions Friday about the matter.

Lt. Gov. Randy McNally said the request was still pending based on the last information he received.

During one of his press conferences this week, Lee said his staff is waiting to see how much federal funding will be expanded to the Medicaid population.

“We are working with the federal government to get an answer regarding our waiver, specifically, and the particular request we have for them to provide funding in conjunction with the state,” Lee said. “But we also believe that they are making efforts to provide outright funding for the uninsured. We’re committed to making sure the uninsured are treated and served in this state through for their COVID-19 health-related expenses.”

About 100,000 people in Shelby County are believed to be uninsured, according to reports. And more than 675,000 Tennesseans don’t have health insurance, a Census Bureau report shows, much higher than the 300,000 reported over the past two to three years.

Lee this week announced $10 million in funding for rural hospitals. But Tennessee’s rural counties have not been affected by the COVID-19 crisis nearly as much as urban areas of Memphis and Nashville.

State Sen. Raumesh Akbari, a Memphis Democrat, is worried that hospitals are being put in a difficult financial situation.

“Hospitals are treating COVID-19 patients right now, and all over the state, hospitals are hemorrhaging money and cutting back staff. They cannot afford much, if any, more delay on a payment plan for treating COVID patients who have lost their insurance,” Akbari said. 

Senior facilities care for those most vulnerable to COVID-19

“Of course, there’s an obvious solution, but if they are going to ignore Medicaid expansion as a viable option to care for people and pay caregivers, a comprehensive backup place should already be in place,” she said.

The Republican-controlled Legislature refused to approve former Gov. Bill Haslam’s Insure Tennessee program to cover uninsured people. And since then, Republican legislative leaders and Lee have opposed expanding Medicaid under the Affordable Care Act, with the governor calling it a “fundamentally flawed” system.

Democrats’ efforts to expand Medicaid when the coronavirus crisis struck died on the House floor.