Tennessee House Bill HB0829

Tennessee 2025-2026 Regular Session

• Introduced: 2/4/25
• Refer: 3/11/25
• Refer: 3/18/25
• Refer: 3/25/25
• Refer: 4/2/25
• Refer: 4/8/25
• Chaptered: 4/29/25
• Passed: 4/29/25

Caption

AN ACT to amend Tennessee Code Annotated, Title 71, Chapter 5, relative to the annual coverage assessment.

Summary

HB0829 updates Tennessee’s Annual Coverage Assessment Act for hospitals, primarily extending the program from FY 2024-2025 to FY 2025-2026 and moving key dates forward by one year. The bill revises the timing of the assessment, installment payments, directed payments, and the program’s expiration date, while also updating references to hospital licensing and financial reporting so the assessment can rely on either a certificate of need application or an equivalent financial report filed with the appropriate licensing agency. The bill also makes several technical and substantive adjustments to how the hospital assessment and related Medicaid-directed payments operate. It adds provisions for situations where federal CMS approvals are incomplete but certain other approvals have been obtained, clarifies how assessments are prorated if a hospital changes status or closes during the year, and adjusts the allocation of intergovernmental transfer obligations when a hospital moves between excluded and covered status. It further updates funding amounts for specific hospital payment categories, administrative support for the program, and certain reimbursement targets, including a reduction in one required percentage from 37% to 36% and revised references to more current JAR data. In practical terms, the bill amends Tennessee Code Annotated Title 71, Chapter 5, affecting the state’s hospital coverage assessment framework, Medicaid financing structure, and directed payment program. Hospitals subject to the assessment, the Tennessee Division of TennCare, and the Tennessee Hospital Association are the primary affected parties. The bill also extends the statutory sunset of the program to July 1, 2026, and makes the act effective at the end of June 30, 2025 so the updated assessment structure can continue without interruption. The overall sentiment around the bill appears strongly favorable and largely noncontroversial. It advanced through multiple House committees and subcommittees unanimously, with no recorded dissent in the provided voting history. The committee action suggests broad agreement that the annual coverage assessment and related payment mechanisms should be renewed and updated for the next fiscal year. The main points of contention, to the extent they are visible in the bill text, are technical and fiscal rather than ideological. The most notable issues are the federal CMS approval contingency, the revised percentage and funding amounts, and the mechanics of how assessments and directed payments are triggered or prorated. These provisions appear designed to preserve hospital funding and program continuity while aligning the state program with federal Medicaid requirements and updated reporting data.

Impact

The bill amends multiple sections of Tennessee Code Annotated Title 71, Chapter 5, extending and revising the Annual Coverage Assessment Act for FY 2025-2026. It changes statutory dates, payment schedules, assessment calculations, and program expiration, and it updates funding and administrative provisions tied to hospital-directed Medicaid payments and intergovernmental transfers. It also adds rules for partial-year hospital status changes and for implementation when some CMS approvals are still pending, thereby affecting hospitals, TennCare administration, and related state-federal Medicaid financing arrangements.

Sentiment

The bill appears to have enjoyed broad support in committee, with unanimous votes at each recorded stage and no recorded opposition in the provided history. The discussion context suggests the measure was treated as a routine but important annual update to keep hospital assessment and directed payment programs operating for the next fiscal year. Overall, the sentiment is positive and pragmatic, focused on continuity and compliance rather than controversy.

Contention

There is little evidence of major political contention in the available record. The most notable issues are technical and administrative: whether the assessment can proceed before all CMS approvals are finalized, how to prorate obligations for hospitals that close or change status midyear, and whether the updated funding levels and percentage thresholds are appropriate. Any disagreement would likely center on Medicaid financing mechanics, hospital reimbursement levels, and the timing of federal approval rather than on the existence of the program itself.