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Federal funding cut linked to lack of Medicaid expansion in Tennessee

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Posted at 5:46 PM, Dec 09, 2021
and last updated 2021-12-09 21:28:28-05

NASHVILLE, Tenn. (WTVF) — As part of the Build Back Better Act, hospitals in Tennessee could see a cut to low-income and uninsured reimbursement.

Hospital groups have made it clear they oppose a portion of the resolution before the U.S. Congress.

Braden Health, a health care company reopening failed and failing hospitals in rural areas of the state, sent a letter to Congress asking them to remove cuts from the spending bill.

A spokesperson for the group said hospitals are already struggling and this is political.

Tennessee hospitals have struggled through the past decade with staying profitable and open.

Now, another blow for those communities, thanks to a provision in Build Back Better Act that would reduce federal funds for states, like Tennessee, that didn't expand medicaid.

The American Hospital Association released a statement in November in opposition to the idea.

"Essentially, what this does is it punishes the hospitals operating in those states by giving them a reduction which our internal calculations could be as much as 12% of their payments," said Kyle Kopec, chief compliance officer at Braden Health. "What this does is it significantly increases the risk of hospitals which could fail in the state of Tennessee and other states, the other 11 states affected."

Braden Health recently started operating four rural hospitals in the state but company officials said they are worried.

The federal provision would block funding but would really impact the state's poorest hospitals.

Kopec said they're trying to get the federal government to change its position because it could hurt their hospitals too.

Tennessee also could've expanded the Medicaid system, but instead opted to try to start a block grant program which failed.

"I think we need to go back to what we're doing here on the federal and state level and ask ourselves, do we want hospitals open to take care of patients? Or do we want to punish someone because of their ideology?" asked Kopec.

There are dozens of hospitals in the state that are currently operating without making a profit.

Kopec says a reduction of 12% would mean they could close.

Governor Bill Lee's office was not available for comment on this story.