Tennessee House of Representatives 112th House Insurance Committee, 26 Sep 2022

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From YouTube: House Insurance Subcommittee- September 26, 2022- House Hearing Room 3

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House Insurance Subcommittee- September 26, 2022- House Hearing Room 3

A

Good afternoon and welcome, ladies and gentlemen, this is a special called meeting of the house insurance subcommittee. It's Monday September 26th the year 2022.. It is just a few minutes after noon. Miss Adams, if you could, please call the roll.

B

Representatives picky Hicks here Kumar laffy, Mitchell, rudder.

C

Terry Thompson chairman.

B

A

B

Have a quorum thank.

A

You very much we do recognize a quorum, we uh most likely will not take any votes, but the potential to call a vote could come up and if so, we do have a quorum and we'll continue to recognize the Quorum throughout the meeting. The purpose of today's meeting is to have some discussions about TennCare both give us an idea where we are with tencare 3, where we are in terms of negotiations and back and forth with CMS on on our conversations there.

A

Also, we want to talk about the uh any issues we have with with waivers just to get an update of where we may be in terms of waivers and potentially discussion of contracts. There will be some issues that have become news of the day that that may may come up, as this meeting arises as well. I do want to take a personal privilege before we get started. We have a new research analyst for the committee to my left. Harris King is our new research analyst for insurance, full committee and insurance subcommittee.

A

Let's welcome Harris, thank you and additionally, one of our favorite people in the room is having a birthday. Today, Tyler Munoz We're, Not Gonna.

A

I pause for a few moments there, because I was going to ask you how old you were, because your mom can't remember so. uh She kind of forgot but happy 34th birthday to Tyler. So congratulations to you.

A

He is. He is of legal age. So, um if we could, we will begin our meeting today and uh we'll ask director, Stephen Smith of TennCare to come, find a comp, a comfortable place at the tables and director Smith. If you could introduce the folks that you have brought with you today and I believe we've got a slide presentation. We've got some hard copies of the slide presentation as we get going, but we do have the slide presentation and director Smith. You are recognized. Thank.

C

You very much Mr chairman and members, it's good to be with you all this afternoon. My name is Steven Smith I serve as the TennCare director to my left is Drew stanievsky. He is our deputy director and then to my right. We have Dr Victor Wu is he's our chief medical officer to his right is Aaron Butler. He is our director of policy and then to his right is Zane Seals and he is our Chief Financial Officer.

C

As you said, Mr chairman we've been asked to provide a number of updates in in the interest of time we will Jump Right, In and I'll start with the 10K 3 waiver, which is a waiver that you all this committee is is very familiar with. This waiver is, has actually been in place for almost two years now. It's kind of hard to believe and we've had great success, and we are very optimistic about where we are headed in the future and I'll talk a little bit more about that.

C

But there has been some recent movement at the federal level around this waiver, and so the timing of this committee is is, uh is really good, so just as a refresher, little historical context uh per legislation that was adopted in 2019, we submitted a waiver Amendment or a waiver to the federal government to CMS, and that was done on November, the 20th of 2019..

C

We had about a year of negotiations with the former administration at the federal level and we received approval of this waiver on January 8th of 2021, and then we brought that back to the general assembly and the general assembly approved that through a resolution on January 15th of 2021.

C

uh Just as a reminder, so at its core, what we are attempting to do with 10 care 3 is is really to fundamentally change. What we believe was a flawed Medicaid financing model uh where previously, the only way that a State Medicaid Program could receive more federal dollars was to spend more money, and we just think that that is a that's kind of backwards.

C

It's not the right way to do it, and instead what we were looking to do is to be rewarded for our historical, effective and efficient operation of our Medicaid Program, and that reward would come in the form of additional federal dollars that we could then reinvest back into the program in an effort to improve health, and this is where the concept of shared savings comes in oftentimes you'll hear this waiver uh referred to as the shared savings model or the shared savings waiver.

C

One thing to point out is: we did receive a 10-year waiver approval that was very significant. Typically, these are five years, but we were able to negotiate a 10-year approval period. That's really important to us because it provided a level of certainty and Clarity going forward for the next 10 years.

C

You all have seen this diagram before and it really illustrates what we're trying to change here on the left side. uh What you see is we. We have a budget neutrality cap and this isn't something that is unique to 10 care 3.. It's actually not even unique to Tennessee any state that has an 1115 waiver for its Medicaid. Program has a budget neutrality cap, and this is not a set allotment of money that we get.

C

But what it means is that if we go above that budget neutrality cap, we do not receive any a federal match for the amount that we spend above that cap we've never been close to that cap. We've always been below that cap, but historically we haven't been rewarded for that and all the reward has really been left at in Washington at the federal level, so with 10 care 3.

C

The way this works is, if we're able to perform below our budget neutrality cap, we get to share in the savings and that's where those additional federal dollars would come in and then we could reinvest that back into the program.

C

So we have been operating under this waiver now for almost two years and, despite some contrary statements by opponents of this waiver on the front end, we there have been no reductions and benefits no reductions in Services, no reductions in individuals serve. This really was uh and is about more, not less. uh It's. It's really just the opposite. We've seen unprecedented improvements in our 10 CARE program. We are serving more people uh just this most recent year, in partnership with the general assembly, we were able to add an adult Dental benefit.

C

That's where we're going to be able to serve 600 000 adults with a Comprehensive Dental benefit. That's the first time in TennCare history. We also are able we've: we've removed nearly 2 000 individuals that were awaiting services for our ECF choices program. These are individuals with intellectual or developmental disabilities. It's been our goal to eliminate that waiting list, and we think that 10 care 3 provides a real opportunity for us to meet that goal.

C

We've had a big focus in partnership with the general assembly around maternal health, and we were able to extend postpartum coverage from 60 days to 12 months. That included a dental benefit as well, and then we've also increased rates to Providers. We targeted specific areas. Of course our mcos negotiate rates with our providers, but we targeted specific areas where, at the state level, we determined we needed to make an investment.

C

So we had increased Dental rates for dental providers, Behavioral, Health, Providers and direct service professionals, and then also we were able to increase payments to our public hospitals through a revision to how we address certified public expenditures.

C

uh So recently we have had um some federal action on our waiver and I wanted to give you all a timeline of events uh here and so go back to 2021 in April there was a lawsuit that was filed by a group of plaintiffs and they actually sued CMS and they were seeking to vacate cms's approval of our waiver in May through the Attorney General's office. We intervened in that lawsuit in August of 21. The plaintiffs agreed to stay the case pending a new public comment period.

C

That would be that would take place at the at the federal level. So the public comment period took place. There was a lengthy review on the part of CMS, at which point, after which point CMS, communicated to 10 care that it had some concerns with our waiver and they asked for revisions to address those concerns and they wanted those revisions by August, the 30th of 2022..

C

So we went to work. We took. We took a look at those concerns. We believe that we could still go forward with the major concepts of the waiver, uh so we published the intended revisions that we would make through an amendment. uh We published that we had a 30-day public comment period and then on August 30th. We did submit that amendment to CMS. uh Now CMS has published that Amendment and it's having its own public comment period.

C

So a lot of steps here to to get to where we want to be, but we are, we are getting close to to reaching uh hopefully reaching some finality here, but again, I do want to point out that this doesn't stop the work we received approval back in uh 2021 and we've been operating under the provisions of the waiver and- and we have implemented the waiver- we're not waiting on this Administration, this Federal Administration to say: go.

C

We already got approval where we are now is that this Administration is asking us to address some concerns that it has in an effort to be able to continue to move forward for that full 10-year period.

C

So the next slide will give more detail on the kinds of things that we're talking about with the amendment.

C

So the first issue, the first concern that the federal government had is they preferred that we had a per member cap instead of an aggregate cap, the way that our waiver was negotiated, we had an aggregate cap and which means that we didn't receive any additional or less funding on our cap cap space unless our enrollment Changed by more than one percent, the the way that per member cap works is we will get an adjustment regardless of whether that's one person or above or below one percent, uh that's something that we can live with.

C

That's the traditional model, I think some would say that actually reduces the risk on the part of Tennessee, because we're going to get an adjustment on our cap for one member five members, ten members, whatever whatever the case may be, the reality is we we already were at a per member cap because we've increased so significantly because of the public health emergency. So it's really not a big change for us, but either way. This is something that is agreeable to us and we can. We can move forward.

C

The next piece- and one thing I really want to highlight because I talked about before the core principle of 10 care 3- is that we are able to be rewarded for our efficient operation of the program through shared savings, and that is not changing. We would still have the ability to draw down additional federal funds that we could reinvest back into the program.

C

The 10-year approval period stays the one. Significant change is the pharmacy flexibility, so we had negotiated the ability to have maximum flexibility in our pharmacy program and, if we chose to, we would have the ability to to have a closed formulary, where we could cover One Drug per therapeutic class.

C

We were the first Medicaid program in the country to receive approval for that flexibility. The exist the current Administration current CMS. They don't really like that policy and um they asked us to remove that from The Proposal. Now the reality is. We had not yet implemented that provision. We knew that that was something that this Administration would likely have. Issues with. There were also there's a legal debate about that. We believe that is legal, of course, or we wouldn't have gone forward with it.

C

The previous administration believed it's it's legal or it would not have approved it, but we had not yet implemented that because we we wanted to see how discussions with this Administration would play out. So we're not losing anything of the sense in a sense that we have not yet implemented it, but we would lose the flexibility to have that closed formulary.

C

So what that means, then, is that we have to cover any drug that is approved by the FDA, which is how it has been all along. I still would argue that it's the right policy for State Medicaid programs to have this Authority Medicare program. The Medicare program. Has this flexibility, commercial insurers have this flexibility. So to me, it just makes sense that State, Medicaid programs would have this flexibility.

C

But when we looked at all of the concerns that were given to us by CMS, we determined that we could still meet the core provisions of our waiver and meet the goals and objectives and get that 10 years of certainty and that would be beneficial for the state.

C

So the next steps in this process, so the Federal Open comment period. Public comment period will complete in October. At that point, CMS will review the public comments. Then we will have additional discussions with CMS, we'll work out any outstanding issues that we have. Then. Hopefully we will have a final agreement and final approval. That will give us certainty for the next eight years and then the other important thing about that. If we can reach an agreement, then we will be able to Pivot and draw down our year one shared savings.

C

um So the way that will work is we've already completed year, one that was 2021 calendar year. uh We believe we had a very successful year, so we believe that we are due shared savings. We have to work out the methodology around all that, but we would be able to draw that down and then reinvest that back into the program to serve our members, and that will be a really that'll be a really significant milestone in our efforts. Around TennCare 3.

C

Mr chairman, that that completes my comments on 10 care, 3 I'm happy to answer any questions on that specific subject um or we can. We can move on to the other waiver amendments.

A

Thank you, Mr Smith I will interject in in folks Shelley's keeping a list. Miss Adams is keeping a list if you'd like to be on there. Please get her attention our attention.

A

The last one of the last statements you made on slide number eight they're discussion of potential shared savings. It may be premature to ask this question, but is there a ballpark any any any ballpark idea from the first Year's experience that we can or could expect from this.

C

Mr chairman I'm, hesitant to give a number, because it really is all dependent upon uh the discussions and the interpretation of the of the language in in the waiver. I can tell you that, from our perspective, it should be significant, uh but I I hate to I hate to give an estimate, and then it's either way more than that or it's or it's way less, because, um depending on what the amount is, we could all think about. Programs that we might want to implement with with those dollars. Certainly.

A

I understand completely and with our chairman of the budget subcommittee in the roommate, he always perks up when we talk about dollars and cents as well, so that was that was a question to ask on his behalf. That was the answer that I was expecting, but but um uh thank you for for telling as much as you could on that any other questions at this juncture.

A

uh Representative Lafferty, chairman Lafferty, you are recognized thank.

D

You Mr chairman uh the public comment period up there in D.C I, don't anticipate, there's going to be too many Medicare Medicaid patients up there doing that. uh Asking questions. I recently saw a chart that showed a disturbingly high number of individuals that had moved from CMS to Big Pharma to some other medical profession to CMS lots of uh interloping. There is that who we can anticipate is going to be making the public comments. Is the pharmaceutical industry.

C

I think that's probably probably an accurate assumption that the pharmaceutical industry will have public comments. But it's not it's not unusual to have stakeholder groups that submit the public comments um for this. I will say that we had to have our own public comment period and um we didn't receive nearly as many public comments for this public comment period as we did when we did the initial public comment period, which I think leads me to believe a couple of things.

C

One we've now been under this waiver for a couple of years and this guy hasn't fallen and we've made unprecedented Investments and we actually are serving more people in the program and we've increased benefits and services um and and then two I think uh generally people feel pretty comfortable with the changes that we have proposed.

A

You recognize chairman Lafferty.

D

Change Pages back to the start of the conversation, the agreement that we had originally.

D

Why didn't we tell the federal government? Hey, thank you, but we've already got this legal document in place.

C

That certainly was an option and we actually still have that option. If we they have the public comment period and they come back to us and they say uh well, we can't. uh We can't give you this or we can't give you this uh or they try to change the core fundamental principles of uh of this waiver.

C

Then we still have the opportunity to say well we're not we're not going to go forward, then what will happen is we'll end up in a in a prolonged legal disagreement and we want to try to avoid that if we can, because we, we really would like to get that certainty, and we really would like to get those shared savings from year, one if we can't reach an agreement- and this goes- and we have to have a legal arguments, then, who knows when we're going to be able to draw down those year, one shared savings and and we're ready to we're ready to get to work?

C

D

And chairman Lafferty, thank you Mr chairman and just a comment. This is for my colleagues up here on the panel. This is for people out there watching that wonder why it is so difficult uh running a government being entangled with the government. uh This is yet another situation where the federal government we've made an agreement with then four years later, eight years later, whatever it turns out to be administrations, change at the top and then all of a sudden, we find ourselves as a state scrambling to make up and to my Democrat colleagues.

D

It goes both ways. My point is the less entangled we are with the federal government, the better off. We would all be that's my opinion. I'll leave it at that. Thank you, Mr chairman thank.

A

You chairman, so picky you're recognized thank.

E

You Mr chairman, thank you all for being here today, uh just just a couple questions trying to explore a little bit more about what you've just talked about. You know you spoke about reinvestments with the shared savings back in the TennCare. Can you just give us a preliminary kind of high level of what you would see with what that would look like going back into TennCare yeah.

C

Thank you, uh representative, I I would I'd actually point to things similar to the things that we've already done just here recently, the Inc the dental benefit for adults, eliminating the waiting list for individuals with intellectual and developmental disabilities that are that are awaiting Services, maternal health benefits. I think are really important, um so those are the those are the things that we pointed to to CMS. Those are the things that we've outlined in the waiver itself.

C

um It's it's hard to pinpoint exactly, because we don't yet know how much shared savings we're going to get. Also these are non-recurring dollars, and so we want to. We don't want to um we've been careful not to say these are the things that we are with certainty going to fund with the shared savings we've given examples of the kinds of things that we want to do, but it would be those those very types of things.

A

Chairman spicky.

E

Thank you Mr chairman and then in regards to the uh amendments that the FED that CMS asked you to do with our TennCare shared Savings. Plan. um Are you in? Are you experiencing any type of lack of flexibility in your day-to-day operations at TennCare that these amendments are putting on TennCare? Or do you still have the flexibility that we had before these Federal amendments or changes were were put on a.

C

Daycare thank you for the question so right now we have. We have the the same flexibility that we negotiated because we are operating under the existing agreement. I, don't anticipate those those flexibilities would go away because we're not we're not changing any of the language around the flexibilities, except for the the pharmacy flexibility that that, of course, would go away, um but everything else we feel good about where we are. We feel really good about the amendment that we've submitted, we're very optimistic that we can reach an agreement.

C

um I think it's telling that this administration at the federal level didn't come in and then just immediately resend this agreement. They did that in some other states, but I think they looked at what we were actually doing: Serving more people increasing benefits and services, and they actually realized that this could be a model for the rest of the country and I truly believe that it can be a model for the rest of the country.

C

A

One continued chairman, Sabiki.

E

Thank you, Mr chairman and last one is the um the decision of Roe v. Wade is potentially going to lead in nine months from now more children and more women showing up on our 10 care list right.

E

Are we going to have the flexibility and capability with our funding sources to make sure that, with those increased numbers, because we all know that you know the the success of a birth is due to the mother, getting the prenatal care that she needs uh possibly drug intervention right, possibly substance, abuse issues right and then making sure that that child, once that child is born, that we have the ability to make sure that child receives all the medical care that it needs so that it can be successful.

E

Are we starting to prepare for that in Tennessee so that we don't get nine months from now, because nine months puts us into June, pretty sure we're not going to be here in June next year? So, are you working on plans for the general assembly that we may have to make substantive changes to TennCare to accommodate this increase in potentiality of having more women and children falling out of TennCare.

C

Yes, sir, thanks for the question, so we're certainly having those discussions, we've we've already. We previously we uh had a emphasis on maternal care and um I'm, really glad that we had already started that previously, but we're having discussions right now about things that we can do moving forward to even enhance our efforts and it's the very kinds of things that that you're talking about.

C

Thank you, Mr chairman thank.

A

You representative, Mitchell you're, recognized.

B

Yeah, thank you Mr chairman. How much of you? How much is your budget total.

C

It's about 13.9 billion.

B

And of that 13.9 billion, how much comes from the federal government.

C

Let's see the federal government, it's about two-thirds of that.

B

Well to my colleagues uh until we his estate can find another 10 billion dollars. I think the federal government does have an obligation to have standards for uh these programs set up across the country. uh You know when we quit becoming a welfare state to the federal government, then uh we can talk about being on our own, but the federal government, thank goodness for tennesseans, is sending about 10 billion dollars a year to Tennessee for our Medicaid patients. Thanks.

A

Chairman Dr Kumar you're recognized.

B

Thank you, Mr chairman. Thank you. uh You touched upon the Improvement in the didd list. Could you kindly just give us a refresh our memory and give us the rough numbers.

C

Yes, absolutely glad glad to do that. It's something we're really excited about. We have a goal of eliminating that waiting list and we were able to jump start that with some of the ARP dollars specifically provided for Home and community-based Services.

C

But then the general assembly, in the most recent budget, agreed to have state funds, invested to pick up that cost once the ARP dollars run out, and so what this is going to allow us to do is at a minimum, We Believe reduce that list and serve additional to an additional 2 000 individuals we're going through the list. Now. What we're finding is that we actually have some individuals on the original list that either have moved out of the state no longer living in Tennessee or they no longer are requesting services.

C

So the list is actually less than what we had originally anticipated, and so what that means is we may be able to eliminate the list even earlier than we originally anticipated, so we're going through that process right now and as we get to the end of the year and early into next year, we'll be able to come back to this committee with a report about exactly where we stand, but I think I. Think right now, we've already served an additional 1 000. My last count was like 1789., so we're we've made great great progress.

A

Chairman Kumar yeah.

B

Thank you so how many people I remember at one time the list was almost fifty five hundred or six thousand people, and we've made some improvements. How many people are still on the waiting list.

C

Well, when we, when we had discussions, budget discussions earlier this year, that we projected about four thousand um so if we serve 2 000, that would leave 2 000 but, as I said, we're actually finding that the the list was was less than four thousand and we're trying to locate everybody that we possibly can uh right. As as we speak.

C

um So it's hard for me to put an exact figure on the the number of individuals that would still be on the waiting list, but those that um we've been able to find and identify uh it's, it's a very small, it's a very small number that would still be on on the list and we're trying, but we're trying to we're trying to go through all that, listen to everything that we can do to reach anyone that was on that original list. Well,.

B

Thank you, that's meaningful work. Thank you. Mr chairman.

A

Thank you closing up this section of the of the Q, a director Smith. If we could back to the initial question, I asked about the shared savings plan, and can you give me again the the timeline? The time frames that we can expect to have uh shared savings determination uh with us? Do we have those dates in hand at the moment.

C

Well, what we do know is the federal public comment period will end on October the 6th. At that point they will review the public comments and then they will engage Us in some further discussions. We don't know how long it will. Unfortunately, we operate under cms's timeline. They don't operate under ours, so we don't know how long that they will take.

C

There's been some indication that they would like to do this quickly. uh Sometimes cms's definition of quickly is different from ours, but I would really hope that by the end of the year or early very early next year, we would have some finale finality to this now. The other thing that throws a wrench into it is there's still this lawsuit. That's hanging out there against CMS that we've intervened in so I'm, not sure exactly how all that will play out.

A

There may be more questions to come back to that in a few minutes. So seeing no more questions on this particular topic director Smith lets. You continue with your presentation.

C

Okay, thank you. Mr chairman uh quickly, I'll go through. We have three other amendments that are pending before CMS. uh The first one relates to idd integration, and so these are individuals with uh intellectual and developmental disabilities, where we are integrating our home and community-based services for TennCare members uh into the managed care system. So these individuals already have their care integrated for physical and behavioral health.

C

This would add the H, the Homing community-based service wraparound service, to that this actually is tied to a budget item for for the FY 22 budget, where we had recognized 34 million dollars in additional revenue, and that is tied to the HMO tax that the mcos pay. So we want to get this done for a number of reasons, both fiscal reasons that 34 million dollars, but also is just it's just a benefit to the program and to the people that we serve to have this uh single person-centered system of delivery of care.

C

Amendment two relates to adoption coverage and you all will recall. This also was part of the FY 22 budget, where TennCare coverage would be extended to children who are adopted from State custody and that would extend through the individual's 18th birthday.

C

um So fortunately, we have enough State dollars that were appropriated for this purpose to serve all of the children that are currently eligible. But we need to get this approved by the federal government, because there's a compounding nature of uh that this service, because you have more children come in every year and it extends to the 18th birthday and I'll say both with actually. With all these amendments, we don't expect any issues. We believe that they will all be approved.

C

The problem is they're, just getting tied up with the other big amendment that I just talked about CMS doesn't want to. They don't really want to move forward until they get the big Amendment settled, because these are amendments to that big Amendment and then the third one relates to enhanced benefits. These would are enhanced benefits to members with disabilities.

C

Enabling technology is the most notable benefit where we got approval to extend or to include that as a covered service. And then we got increased expenditure Authority right now. We're able to do this through an emergency waiver that we were able to receive because of the public health emergency. This would make that permanent and again we don't expect any issues on any of these three happy to answer any questions on those.

A

I think we're good director. Forgive me, representative, Thompson you're recognized on this topic. Thank you. Mr chairman.

B

uh Just a few questions on the Amendments one, um the adoption coverage would cover all adopted children from State custody that no matter what the economic circumstances of the adopted parents are. That's correct, so a wealthy um adopt a family with still the child would still be covered by TennCare. Is that correct that.

C

Is right that is right and I think it's it's designed as a as a way to to Really, encourage adoption and to and to help families uh with that adoption process. Okay, okay,.

B

I mean I'm happy with a lot of the expansion. That's done a lot of the additional Services I've. Just always um am skeptical when you know we're talking about a lot more money, and uh you know our budget's been very nice over the last few years. You know where you so last year we had uh seeming like more money than we knew what to do with um that's. Not none of us expect that to be forever, uh we've had some pretty tight budgets in the past.

B

What, if that happens, is that uh the potential for reducing or eliminating some of these benefits uh still there.

C

huh Well, we would, we would have to go through a a process if we were going to reduce or eliminate any benefits. I I would say that if, if we find ourselves in that situation, then we're going to have to have a just a bigger discussion that would involve the general assembly and the budget process and.

B

It would involve CMS as well. I would assume it.

C

Would we would have to, um we ultimately would have to provide notice and go through the public notice process, but but ultimately CMS? They can't tell us uh they can't force the state to indefinitely provide a benefit. That's that's not required at the federal level.

B

Okay, um okay, thank you.

A

Chairman Sabiki you're recognized.

E

Thank you, Mr, chairman kind of following up on that on that thought process.

E

um If a if a family adopts a child and they have insurance, private insurance would 10 care, be in a supportive role to that for that child, or would they be in a primary role for that child.

C

Mr chairman, it's okay, I may defer to Aaron our policy director and he's probably the best person to speak to this. Certainly.

A

You recognize, sir pleases, if you could state your name and your position. As you begin, the answer.

B

uh Yes, sir, my name is Aaron Butler I'm, the director of policy for TennCare, and thank you for the question, sir. um Yes, the the policy goal here would be, of course, to remove potential barriers to adoption for children who are in state custody for families with whom Insurance may be a barrier or consideration so that all children have an opportunity to be adopted into permanent homes. But in cases where a family has primary Insurance other than Tin Care, then that's you are correct. The commercial insurance or the private insurance would be.

B

The child's primary Insurance TennCare would be a secondary payer to pay for anything. Perhaps the the private insurance didn't cover, or things like that in a secondary role.

A

Chairman Sabiki and.

E

A follow-up on that hypothetically, if a child gets adopted from our foster care in Tennessee and those parents, move outside of Tennessee is TennCare going to follow that child to make sure their coverage covered until possibly a new State Insurance com. A new State Insurance would pick up that child.

B

Thank you for the question. So yes, um the overall policy goal here is to provide an incentive for adoption to remove potential barriers for adoption. When we say cover all children adopted from State custody, there would be some exceptions so, for example, if a child passes away, if a child moves out of state, if a child uh enlist in the military, it is no longer the responsibility of the adoptive parents than TennCare coverage would end things like that. So there are some exceptions like that.

C

We uh represented we, we would no longer have the authority to cover that child if the child moved out of state.

A

Followed chairman Sabiki I.

E

Could be wrong here, I believe we did pass a law that uh chairman Holt carried about covering children with disabilities outside the state of Tennessee. If no program was a was able to be found for their remediation, they need here I, believe we passed that already. If that's the case, my question would be is now I would understand that if a parent moved outside to Michigan right whatever, but what, if a family adopted, I'm giving you a hypothetical here? What?

E

If a family adopted who's in the military who serves in Clarksville and they live in Kentucky? Would we shut that child off from TennCare, because they're serving in the military in in Clarksville, are in Hopkinsville, Kentucky and I? Get what you're saying I really appreciate, because that's kind of where I'm going with this whole in nine months from now right, making sure that these children are covered and adoption is as as friendly as we can get it in Tennessee Would.

E

We not have the ability to make sure that that child stays covered until there's a transitional plan from the other state. I'm sure most states have some type of TennCare Missouri care, Michigan care that child would be covered. So how would a child not? How do we protect the child not falling through the cracks.

C

It's a good question and we we can look into this state provision that you are referencing um I. Think the issue on the Medicaid side is that we are only authorized to cover Tennessee residents and we wouldn't be able to draw down the federal match. Every state has a different match and so I don't believe that we would have the authority to draw down a federal match for an individual that lives in Kentucky, for example.

C

Now, if the state on its own wanted to have a provision that allowed for some continuity, then we could utilize 100 State funds to do that. um But we will. We will look into that um state law that you referenced and see. Maybe if that has some applicability.

A

Thank you, Mr, thank you and chairman Sabiki. We were researching that back here as we as we speak as well. I, don't know if we'll have an answer about the time.

A

The meetings then we'll certainly try um director Smith I want to lead you into the next part of our ever conversation that that you've given to us um uh in the in the PowerPoint you had mentioned earlier, we're just under a 14 billion dollar program and uh substantial, and we have recently issued an RFP all the ins and outs and all the programs that we've been discussing over the last 30 45 minutes or so have those been, are the potential providers within the mcos and the providers?

A

The wrong word that the mcos I'll talk about that are the mcos aware of all the all the ins and outs of what they needed to include need to include going forward and needing to include in in their proposals to us and I'll. Let you answer that, as you begin the next segment of your as your presentation.

C

Thank you Mr chairman. Yes, they are, they are aware of uh of where we are in the process.

C

um I think the uh one of the real positive things about this 10K 3 waiver is, we really didn't have to change what we were doing from an operations perspective from a day-to-day perspective, all we had to do to be successful was just keep doing what we, what we were doing and have an efficient and effective Medicaid Program uh be spend below that budget neutrality cap, which we have always done, and then we get the benefit of those shared savings dollars more specifically to the MCO work.

C

One of the things that we were asked to do is to give an update on contracts and, of course, TennCare has many many contracts, but the contracts that get the most attention are the MCO contracts, and rightly so, because these are the largest contracts that we have in state government and so there's a lot of interest in those contracts and I thought maybe to level said it might be beneficial to go through a timeline of events relative to the most recent MCO procurement.

C

And so that's what you see on the screen there so go back to 2021 in June of 2021, we issued the request for proposals for the MCO contracts.

C

uh The evaluations of those contracts were completed and there was a notice of intent to award in November of that same year. 2021. There was a protest that was filed by a losing bidder that was done on November 15th of 21.

C

there's a process in law that outlines what a protester needs to do to protest an award, and so the first step is that that protest goes to the central procurement office, and so that protest was filed. The protest was denied by CPO in January. uh Then the protester appealed that denial to the State protest committee.

C

That appeal was in January. The State protest Committee in July of 2022 unanimously upheld the CPO denial and ruled in favor of TennCare.

C

Most recently, the the protester filed a petition for judicial review in Davidson County Chancery Court, and that happened very recently on September. The 12th um coupled well not really coupled with this, but I do want to clarify. We currently have three contracts before the fiscal Review Committee. Actually it's up before the fiscal Review Committee this week. These are amendments to the existing MCO contracts, very separate from the new contracts that we're talking about with this procurement. So we have an existing. We have existing contracts with three mcos.

C

We rout routinely bring amendments about every six months to the fiscal Review Committee for technical changes and so the Amendments that are before fiscal review. Those are the technical, the typical technical changes. We are not seeking an extension in the Amendments that are before the fiscal Review Committee this week. So I do want to make that clarification.

C

um Now we have, we have two paths forward. We either have to move forward with the new contracts that were awarded per the procurement or we're going to have to eventually extend the existing contracts because the existing contracts expire at the end of this year, so we either have to move forward with the new contracts or we're going to have to extend the existing contracts. Otherwise we don't have.

C

We won't be able to operate a Medicaid Program, because we won't have the authority to pay claims and to have a provider Network and all of those things that are necessary because we are in Managed Care State, and so it's very important that we do one we're going to have to do one or the other to be able to to move forward. So I did want to clarify that so with that Mr chairman I'm happy to answer any questions with, with the caveat that this this is now under active litigation and so I may be.

C

I may be limited as to what I can say.

A

Thank you director.

A

You've told us that we're looking at the end of the year to continue the existing contracts with our three mcos is that accurate and what the? What, if scenario, if the protest is still ongoing and still being litigated? What does that do? Are we operating under a we've talked about the federal government several times in here? Lately they like to operate on continuing resolutions. Are we operating under some type of Quasi continuing resolution at that point in time,.

C

No Mr chairman there's not an automatic uh continuing uh operation. uh That's why we will either have to move forward with the new contracts and execute those contracts, or we will have to come before fiscal review before the end of the year and get that extension. It's going to have to be one or the other.

A

Thank you chairman sapiki. Are you ready to ask a question or two okay, chairman Topeka you're recognized thank.

E

You Mr chairman, so kind of broad I'm going to broaden out on this MCO issue here. You know I've been looking at this serving on the 10 care committee for four years. I know some of you served a lot longer than I. Have one of my greatest concerns is the lack of competition with the mcos in general.

E

um There are and I know statutorily. It's capped at three I believe is. That is that.

C

True, it's it's not in statute representative, that this is a internal policy that that we have chosen, and there are multiple reasons for that: I'm happy to go through those. But that's it's not a it's, not in State Statute that we we can only have three a little flexibility.

E

Mr chairman, you.

A

Recognize chairman, thank you to go back and forth. Thank you.

E

Mr chairman, so um so, TennCare does have the ability to expand it to four to expand it to five to expand it to 15 if they want to or to expand it to any, but any MCO that wants to come in as long as they meet the qualifications put forth that you have as an organization that they could come in and be an MCO for Tennessee and provide Health Care to people in Tennessee.

E

One of the things that I that I believe in is competition in the marketplace. We have three mcos right now that have cornered the market in Tennessee. I can give you the data. You already know the data there's three of them and one of the things I think that we could do to help our shared savings plan and to help the people of TennCare, who are on TennCare and to be able to expand Services is to bring competition into those three mcos to help provide the best care for the people of Tennessee.

E

That's the bottom line of what we're here for right to provide the best care for the people of of Tennessee. That, unfortunately, are in a situation that they need TennCare.

E

um You know we tried to do this last year with with a bill to expand it um and I. Think we really need to continue to look at that is. Are we doing what's best for the people of Tennessee, where we could bring competition of other mcos, and the list is endless here?

E

New Jersey has five Washington has five Virginia five Louisiana five Indiana five Maryland nine Kentucky six Wisconsin 14 Minnesota 8, Oregon, 12, South, Carolina, four, it's all over the place and I, don't think, there's I, don't think we should set a scale to say you know what we're going to be three and three only why, when we let the marketplace determine that, why wouldn't we let the mcos determine that with the auspice of making sure that 10 care make sure that these mcos meet the requirements put forth to provide Health Care to our individuals in Tennessee.

E

So that's one thing: I hope that you can consider that as legislators, I hope that we can consider is, you know, give 10 care the opportunity to expand and bring competition into the marketplace. To provide better coverage, and if that's not going to happen, then I think we need to really consider ourselves as legislators, here of making sure that we're doing what's best for us, for the people of Tennessee on TennCare and to provide the best service the most cost-effective way to do it.

E

I think the way you do, that is to bring competition in the marketplace. One comment.

C

Yeah, thank you for the comments and I actually I I believe that the the right conversation around this subject is uh I think there is a policy debate to be had around the number of mcos that we choose to go forward with, rather than why did a losing bidder, not score higher than the third place.

C

Bidder, and maybe it'd be helpful to um discuss with the committee about why we why we chose three um and and for us and and for me it was really about looking at our own history in the 10 CARE program and we've had experience with three for a number of years and we've had experience with with more than three uh Tennessee really is the leader in Managed Care Nationwide.

C

Today, states have followed tenncare's, lead and Tennessee's lead where you have 70 percent of individuals in Medicaid across the country that are served through a Managed Care Organization. So we've made as a 10 Care Program. You all have seen the charts. We've made all the mistakes that you can make in in Medicaid and we've learned from those mistakes and when we look at the greatest period of success for the TennCare program, it's the period in which we had three mcos and I'll.

C

Give you um some examples, and it's not to suggest that it's only the number of mcos that that lead to the success, but we do think that's a important piece of it. So from 97 1997 to 2008, we averaged eight mcos in in this state, and our annual increased spend was about six and a half percent.

C

uh Clearly that was unsustainable from 2009 to 2020.

C

We have where we had three mcos we've averaged an increased spend of 2.4 percent and- and this makes it makes logical sense, uh more lives covered by an MCO results and it results in a better deal for the state because it reduces the risk on the part of the MCO. So we get better capitation rates, we pay less in administrative costs.

C

We need less staff at the TennCare level to Monitor and frankly, we get more attention from the corporate offices uh with the more lives that are being covered by a particular MCO um from a quality standpoint, because I know that TennCare often gets criticized for only caring about money and I. Just I dispute that I think you in order to be our mission, is we have a cost? You have to have cost Effectiveness and we also have to have quality in order to improve lives and I.

C

I really believe you have to have both to be successful. You have to be successful in both, but being cost effective actually allows us to improve quality because we can serve more people and we can improve the services that we provide, but for the most recent year with completed data we 10 care Tennessee is performing better than the national Medicaid average in nearly 60 percent of the individual hedis measures.

C

So these are measures that all the states have to have to provide to CMS or to and report on, compare that to 2007 we beat the national average and only 40 percent of those measures. So we've seen clear improvement over time um from an access standpoint. We believe that our provider network is stronger today than it has ever been.

C

um We have a survey- that's done every year, not by TennCare, but by the University of Tennessee, where they gauge customer satisfaction. So these are our actual Medicaid members that are rating our work. The most recent results we have a 92 percent customer satisfaction rate.

C

That's the 13th consecutive year, where we've been above 90 percent um from a from a provider perspective, there's less burden and bureaucracy for the providers, with the fewer mcos that you have less negotiating and renegotiating contracts, less credentialing, uh less communication, around payment issues, prior authorization, all of those things um now. Is it accurate that some providers may get a higher rate with another MCO that comes in it's probably accurate, but it's also just as accurate that some providers would get a a lower rate.

C

um So it is to your point, uh representative. I. Do think that there probably is a debate around Innovation uh and competition with additional mcos, but I think the question is: do does that potential benefit outweigh the the certain risks and, and one of the certain risks is additional cost on the part of the state.

C

um With with the bill that was introduced earlier this year, that would have required a fourth MCO. There was a 90 million dollar cost to that. Now, that's not all state, that's about 30 million state, but um we just we don't believe from a TennCare standpoint. We just we don't believe that the potential benefits would outweigh all of the potential negatives and the certain negative of the additional cost to have to have an additional NCO. So I hope that I hope that helps somewhat.

C

But I wouldn't argue with you that um I wouldn't say that it's not a a worthy policy debate.

A

I'm going to interject here before you go on, if I could anecdotally, director Smith I have heard from numerous professionals across the state that you mentioned. There is negotiation between provider and mcos. Several of the provider communities would think, there's not real negotiation. It's almost. This is what the MCO is going to pay, and this is what the provider is going to take and we have had those discussions over the last couple of years.

A

I don't know if you want to comment on that, but but that is that's part of the reason we're having some of these policy discussions. Part of the reason we had some of those policy discussions over the last calendar year and uh and and while we're still having some discussions now, yeah.

C

Thank you for uh for that comment.

C

um I would so typically, when we hear complaints from providers about an MCO. It usually is around rates, um and um we've talked about this in this committee before where there is a healthy tension between payers and providers. Certainly when you're, when you're talking about a taxpayer-funded payer and I, think I do think that that tension is healthy. What we focus on at the TennCare level is we have to. We have to ensure that we have an adequate network of providers so that our our members can be served when they need services.

C

um I I would take the position. I do take the position that adding a another MCO or two more mcos or three more mcos.

C

It's not going to alleviate and certainly shouldn't alleviate that healthy tension. But, as I mentioned before, if you have a fourth MCO come in, some providers may get a higher rate, but some providers will also get a lower rate. That's just kind of how Managed Care works and, and we hold the mcos at risk and so part of holding them at risk. Is they they negotiate the rates with the providers and and we're very careful not to um not to inject ourselves into that, because, ultimately it is the MCO that's at risk.

C

Now we hold the MCO accountable for having an adequate network of providers and we certainly listen to our providers when they do have issues with the MCO we try to First. Have them go to the mcos directly and have those conversations, but there are times where you know we will facilitate conversations.

A

Thank you, director and I will note on on slide number five on your presentation. Earlier. We did have increased rates because through Dental Behavioral Health direct service professionals increased payments to public hospitals. Those are hopefully reactions to the legislative branch.

A

Saying there's some issues here, there's some problems here. It was quite time consuming. It took a lot of effort to to be heard on those issues and hopefully in the future. It won't take quite as much effort that we're going to be heard the first time around chairman so picky did you have some follow-ups, please the.

E

A

Speaker, you recognize.

E

Thank you, Mr chairman. Let me shift gears again on you here a little bit so um I, don't think you were here in 2016 as this position is that correct, correct? Okay, so, in a final rule by CMS in 2016.

E

2016., they stated that the states needed to be at an 85 hbr health benefit ratio. We are not there still and I've gone back and looked at all the data since 2014., and only one provider in one year has been an 85 percent health benefit ratio or greater only one. Currently, the three mcos sit at one sits at 76.9, one sits at 80.5 and the other one sits at 80.8 below what CMS has stated that they wanted us to do back in 2000 and 16.

E

now, I know we don't have anything statutorily requiring a health benefit ratio going out. So we can pay better for our providers to provide uh better payments to our hospitals that border on Rural communities. uh The hospital that I I represent Murray Regional provides basically all of the health care to all of Southern, Middle, Tennessee below Murray County and pretty much east and west.

E

These one of the complaints we get is our rural Health Care is lacking so much in Tennessee having conversations with my hospital it's because of the lack of payments. We get back to the argument that the chairman made is these negotiations, which one could argue is when one's holding all the money and all the cards. What kind of negotiations are you truly having and you have to, and you have to play by that we saw this argument last year when I ran the bill on Pharmacy benefit managers.

E

The argument of these providers dictating what they're going to be paid, and so um do you care to comment on that of. Why haven't we met what the CMS has asked us to back in 16 of being at least an 85 percent health benefit ratio.

C

Thank you for the question. I I'm not familiar with hbr I I, guess we're more familiar with the the medical loss ratio.

E

Interchangeable.

C

Terms: uh okay, okay! Well, then, I think it's important I think our data would be different from from your data and Zane I. Don't know if you're, if you're prepared to talk about that, but yeah. Absolutely if you.

B

Can please introduce.

A

Yourself, your position and and continue with your answer.

F

My name is Zane Sills and I serve as the Chief Financial Officer for the division of TennCare. Thank you very much for your question.

F

um So in 2016- and you know, we may be talking about slightly different topics here, but in 2016 CMS did release what was called the Managed Care final Rule, and that was a over a thousand page regulation. It did a lot of things, but one of the requirements that it put in place was that when State Managed Care States, like Tennessee, set capitation rates, we are required to set those capitation rates with the intent that the MCO would achieve no lower than an 85 percent medical loss ratio.

F

So the requirement in that regulation is not that the MCO actually achieves uh a certain medical loss ratio at the end of the year, but prospectively on the front end that the state's actuaries when they're setting actuarially sound capitation rates have to set that with the goal uh that the capitation rate would be no lower than 85 percent. So we have been compliant with that rule ever since it's gone into effect.

F

In fact, our actuaries were already setting our cap rates that way, even before 2016 before CMS put that rule into effect and uh for the past several years. Our mcos are consistently say why and having mcos above 85 percent.

F

There may be one point of confusion on how that calculation Works, where the the state uh here in Tennessee has a six percent premium tax, and so that does not count against the mcos, and so you may, if, if you count it, you may have an mlr of 82, but if you don't count it it's an mlr of 88. So CMS is a requirement, applies to the net of Premium tax calculation, and so that's how we do it and our mcos, according to that methodology, are consistently above 85 percent.

A

Foreign speaking.

E

So you're saying they're achieving that with the tax on it.

F

Once you net out that state premium tax, we are yes or compliant with uh with the intention there and and federal uh rules and.

E

Can you describe the tax and what its purpose is.

F

So in state law we have a six percent premium tax on health maintenance organizations, and so um that has been in place for many many years, certainly predating my time at TennCare 11 years ago. But basically, the state imposes a six percent tax on all Health maintenance organizations in the state and and they pay six percent of their premiums to the state as a tax that goes into the state general fund.

E

To the general fund.

F

E

A

Okay, continue chairman speaking.

E

If we're talking about 10 care dollars right, that's what we're talking about right.

F

uh Well, the the those tax dollars from the premium tax go into the state general fund. Okay,.

E

But the MCO is paying that tax from 10 care and CMS funds. Is that correct? Yes,.

F

Sir, so they they pay those uh taxes out of the capitation rates that we pay them, which is a mixture of State match and federal matching dollars.

E

So they're paying a tax from their corporation with money, that's provided to them by Tennessee taxpayers and federal taxes.

F

Yes, sir, ultimately, all dollars that are paid to them in capitation rates uh are taxpayer dollars.

E

All right, thank you.

A

Thank you going back a few statements ago and, as you are having this conversation with chairman sipiki, we're talking about approved rate increases for some providers. How is this being accomplished through some type of tax? How? How are these, let's talk about? How um how these increase to Providers are being are being accomplished? Is you could.

C

Thank you Mr chairman, so these are accomplished through what's called a directed payment and uh if it's probably best to have Zane kind of walk you through how that works, but it it's different from the typical it's not the MCO rate negotiating. uh It's a directed payment where we are essentially saying as a state we're gonna we're going to pay these additional dollars.

A

Still you recognize.

F

So I think you may be asking about uh certain of the Investments that we made in the last uh budget cycle, and we talked about those earlier Investments for dental Investments, for Behavioral Health and at home and community-based services, so those all went through the budget process. So ultimately those dollars were approved and allocated by the general assembly.

F

So again, general fund dollars I think it's important to note that on some of those funds, particularly the HCBS funds, as part of the ARP uh Federal Congress passed a temporary bump in the state's match rate for certain types of services, and so we were able to use those funds for a period of three years, we're still in the middle of that right now, and so when we went through the budget process, we said you know we want to make these increases.

F

We can use the additional Federal money to pay for them for a period of three years and then the legislature approved that but also approved that when that three-year period expires to use state general fund dollars, as as the state matching portion.

A

Thank you. That's very helpful. I appreciate you bringing that home for me. Thank you very much committee members, questions or comments uh chairman Dr Kumar. Are you recognized.

B

Thank you, Mr chairman. If you will indulge me I'm going to step out of the declared agenda of this uh proceeding and question about 10 care that I get in my district at times has been people who were removed from the roles and reinstated and how, where do we stand and how many people, as some of the federal funds expire, are in danger of being left off? Kindly give us a landscape, so I can answer people in the district.

C

Thank you for that question uh chairman. So um what you're referring to is that, during the public health emergency, we have been prohibited from removing anyone from the roles and, and so we have paused our redetermination process, and that, of course, has led to a significant increase in our enrollment.

C

We are up about 20 percent since March of 2020., so that's about 285, 000 individuals who are that's an increase over where we were um it's it's hard to to know specifically how many of those individuals will eventually come off of the program, because they will go through that redetermination process where they will have to provide the the necessary documentation uh to ensure eligibility so we'll go through that process.

C

We've been asked to make our best projection our best projection is we believe that after we go through the 12 months and the and everyone goes through redetermination, we believe that we will be back around 1.4 million right now, we're close to 1.7 million. uh Now that is our best projection. uh We we don't that's, that's not certain. We will have to go through that process and and see ultimately, who is eligible and and who is not.

C

B

You so what will be the reason that these 300 000 or so people will be off the 10-year enrollment.

C

The most common reason would be a change in income status. That would be the most common reason.

B

And there is an appeals process. Yes,.

B

Thank you. Thank you. Mr.

C

And uh if I can Mr, chairman I'll, certainly I'll put in a plug, because we are doing everything that we can right now, while the emergency is still in place to communicate with our members that it, it is vitally important that they update their contact information with TennCare, because we have to have a way to get information to them uh by law, federal law and state law. We cannot keep someone on the Medicaid Program if they do not provide the necessary documentation that that they are in fact eligible.

C

So we we really need everyone to respond uh to TennCare mail and TennCare communication. When we provide that communication and we're doing that in many different ways. Now it's not just traditional mail, email text messaging. We have our new eligibility system that has been modernized and it's now in place, and so the process is going to be much easier than it has been in the past. But but ultimately it is the responsibility on the individual receiving the benefit to provide the information that we must have to continue.

C

Enrollment in in TennCare.

B

A

Thank you, as chairman, Dr Kumar has taken us down the path of of some issues that may not be on the agenda. I have a couple of questions too. Director. If you could the issue of the day issue of the last week, really in the state of Tennessee for TennCare, are we I'm, sorry um 14 karat? Do we cover and or pay for transgender reassignment surgeries for minors.

C

We do not Mr chairman, we have a specific exclusion uh in our program for that for that service, okay,.

A

And if you could continue in that vein, do does TennCare pay cover and or pay for um hormone blockers for minors in in certain situations. If you could, please answer that and if you have a ballpark idea of any type of cost that might be associated with that, that would be helpful as well. Director.

C

So the um the the blockers that you just mentioned that we we do not have an ex a specific exclusion uh for that, which means that it would be covered if it meets medical necessity guidelines.

C

It would be very rare and I know that this body past legislation a couple of years ago, that would prohibit a provider from providing those services so in in many cases. So we would never get a claim that would be, and we should never get a claim. That would be in violation of that legislation that you all passed. But there is no specific exclusion for that particular service, and so it's possible that it could be covered if it went through that whole process and it was determined to be medically necessary.

A

Two words: we've heard a lot the last couple of years, medical necessity. So, yes, chairman so picky, did you have a follow-up.

E

I did Mr chairman.

A

You recognized.

E

So kind of going back over here, I just want to clarify something here. The six percent you're talking about does CMS will recognize that in their medical loss ratio, because the six percent has nothing to do with the health care provided to the citizens of Tennessee, that's a tax that we put on the MCO.

E

So does CMS recognize the six percent, or do we recognize the six percent CMS.

F

uh They did not count that as part of their uh calculation, their the methodology they used to to make that requirement. So we're consistent with CMS and not counting it.

E

So you're telling I thought you just told me that we do count to six percent which allows them to get over the 85 percent. No.

F

No, that that's excluded from the calculation for purposes of measuring mlr mlr is calculated net of Premium tax, um both by how the state looks at it and also per CMS. So.

E

So what you're telling me I want to get this straight is that the numbers that I have are provided by CMS and the numbers I'm I'm giving to you are from CMS, but you're telling me our mcos have higher numbers but you're, but you've made a statement that, if you take the numbers plus the tax, it gets them over. 85 percent. Is that what you're saying I.

F

Haven't seen those numbers from CMS my apologies, it would be very difficult for me to say exactly what you're looking at, um but if we were able to take a look at those numbers, we could maybe um explain what what's what's going on there. Let.

E

Me ask a better question better question here: the numbers that you have that you are can probably pull up for our mcos of their medical loss ratio that percentage that 86 percent, that 87 percent does that include that six percent tax accounting for them or is it excluded from those numbers excluded?

E

So you're telling me that that they are all above 85 percent right now in the state of Tennessee on their medical loss ratio? Oh.

F

Well, the FIS are, the county, are 22, numbers are not yet final. um So.

B

F

Last year, uh those numbers are also not finalized yet because we have a risk Corridor in place for calendar 21, so we're currently finalizing those numbers as we speak, so how about in 20. uh in 20, uh I'd have to go back and check I believe they were above 85, but I'd have to go back and check. So if.

E

You could provide the chairman that information, so he can disseminate it to this committee. So we know that from the last data we have. Our mcos are meeting our 85 threshold for medical loss ratio, we'd.

F

E

F

E

F

E

You thank you Mr chairman thank.

A

You: how quickly can we get that information.

F

A

Okay, as we wrap up here, I'm looking to my committee members director Smith can, can you talk to us? Let's go back to the MCO issue again and what we're looking at absent, nothing happening, we're up against the a deadline of the end of this year uh and potentially going forward. What time frame are we looking to go forward with the existing three mcos apps at the protest and a protest success? What time frame will these contracts envelop? How far are we looking out in in history.

C

Well, we're looking at the very near future, so it would be uh January 1 of 23.. Now I I can't speak for any action that the plaintiffs in this case would take.

C

Currently, there is not an injunction, but we're gonna have to do something by the end of the year, as I said before, we're either going to have to execute these contracts, and- and we would start with these new ones- January 1 2023 or we will have to have an extension of the existing contracts and continue with those existing contracts.

A

The legality of the extensions is that something that the state's attorney general is looking into is that something that we can do extend those is that something we cannot do and give me a time time frame on that.

C

We we do have the authority to extend those contracts, it's ultimately a decision for the fiscal Review Committee, but we do have that Authority and in fact we we extended it. We actually extended it a year previously because of uh the the public health emergency.

C

um So we already had one one extension year after the option years, and so we we do have the authority to extend.

A

Dr Smith: when would the next RFP occur after this January 1 23 time frame? We're looking at when is the next time frame the.

C

Next one, uh so we the Drew, maybe can correct me if I'm wrong, but the the new contract. It would say it's a three-year contract and then there are five option years. Where we have, uh we have the ability to exercise the option um so at its at its most it would be um eight years, but then we would of course have to put out the RFP well before the expiration of that and trying to think about the timeline. But that's it's a three-year contract with five option years in.

A

Order to exercise those options is that something has to go through fiscal review. Does that go through the legislative process? It.

C

Does it goes, It goes to fiscal review.

A

Each year or okay, I'm seeing head heads nod that it would be yes, okay, thank you.

A

Chairman speak. You recognize thank.

E

You so these contracts, if the general assembly wanted to move to expand, mcl's next legislative session session.

E

If these contracts are signed, would that prohibit the general assembly from it from expanding the mcos.

C

I, don't believe it, it would I think we would just have to procure another we'd have to go through another procurement to have to add one more MCO.

E

Or whatever the generals tell me what to do? That's right.

E

Do we have to do anything right now, or can we wait until the general assembly comes back because this legisl this this bill was up before last year? So this is a conversation that probably the whole committee would need to have on whether or not we want to move forward. Could we postpone the contracts until we get to January and we could come back into session.

C

Well, we we have to do one of of the following: either we have to execute these contracts, the new contract or we have to extend the existing contracts. Otherwise, we have no contract in place and we can't operate the program. So one of those things has to happen.

E

So could you not just extend because we got three mcos right and the contracts are for those three mcos? Is that correct? Yes and those three mcos are going to abide by all the rules and laws that they have to abide by correct? Yes, so could you not just extend their contracts until the general assembly comes back in it, and if the general assembly chooses not to expand the mcos, then you could put the RFP out for the contracts you're done or leave the extended contracts in place.

E

If the general assembly doesn't act on anything, then what's the what's the? Why wouldn't you just extend them until.

E

We come back into session and start to make a decision on working with you what's best for the people of of Tennessee, could you extend them.

C

We can again, ultimately it's a decision for the fiscal Review Committee, but we do have the option. The state has the option to extend the existing contracts. That's correct, Mr.

E

Chairman, do we have a do? We have the ability to make a recommendation to fiscal review.

A

I believe we do uh if there were to be a motion made by the committee, we have continued to exercise a a quorum as we have been meeting, so we do have a quorum.

E

Can we take a two-minute recess.

A

The uh has been whispered in both of my years. uh It is to take a recess. We will not uh will not put a time frame. uh We will take a a very brief recess and and gather around the Chairman's desk Chairman's chair right here.

A

A

We are back in session.

A

Thank you and we are up against a hard stop here.

A

Chair, Mr picky. You are recognized.

E

Thank you, Mr chairman, um to maintain the greatest flexibility we have in the general assembly and to not get us off on the wrong foot here. Mr chairman I would like to make a motion that we that this committee takes a vote and what the vote would be is to urge fiscal Review Committee to deeply consider extending the contracts instead of issuing new contracts to buy the general assembly time until we come back into session in January and can discuss this issue further.

E

So in the form of emotion, that's what I'm making Mr chairman is that worded correctly.

A

We have a motion. Do we have a second.

A

As we were discussing this, was uh it's been requested to take a another brief recess? We are in recess.

A

All right house insurance subcommittee is back in session. We are out of recess um chairman Sophie I'll recognize you Mr.

E

Chairman I'd like to withdraw my motion, okay motion.

A

Has been withdrawn, I can't recall if we ever recognize the second round, but motion has been withdrawn. Chairman sapicki, you are recognized. Thank.

E

You Mr chairman Mr chairman, if it'd be possible, um if the, uh if yourself, chairman, Hawk and chairman Kumar, could just send a letter to the fiscal Review Committee um asking them to consider extending these contracts instead of issuing new ones, to give the general assembly more time to consider whether or not we're going to expand the mcos. That's all. Thank you. Mr chairman.

A

Duly noted, thank you uh director Smith as we're closing up here. Would you uh like to make some comments.

C

Thank you, Mr chairman, just one point of clarification that may be helpful to the committee for the fiscal Review Committee does not issue new contracts.

C

um They they are responsible for extending, so I just wanted to make that clarification without it.

A

Thank you, director, Smith, any more comments in closing anything you'd like to close us with and then we'll go to committee members, as we are up against the clock here.

C

No Mr chairman committee members, I'll just uh say thank you for the discussion and and uh appreciate the opportunity to be with you all this afternoon.

A

Thank you. Thank you, director Smith, your team. We really appreciate that any comments or questions from committee members seeing none. We are adjourned.