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Tennessee Medicaid Opt-Out May Cost Employers Millions


MURFREESBORO, Tenn. (WMOT)   --  A new study suggests Tennessee businesses could get hit with an additional $72 million a year in federal tax penalties if the state does not expand Medicaid.

An expansion of state Medicaid programs was written into the new health care law, commonly called Obamacare, but that provision of the law was struck down by the Supreme Court. Many states then opted out, including Tennessee.

As a result, tens of thousands of low-income Tennesseans have fallen into a health care gap between the two programs. A new study by the tax firm Jackson-Hewitt says Tennessee employers will pay tax penalties on each of those workers beginning in 2015.

Marc Hill with the Nashville Chamber of Commerce says the Chamber continues to urge Governor Haslam to accept Medicaid expansion and the billions of federal dollars doing so would bring to the state.

“Having more insured Tennesseans is good for folks who can now pay their medical bills, it’s good for doctors and hospitals who are getting paid for services their providing, and it’s good for Tennessee businesses who won’t get hit with new federal tax penalties due to no fault of their own.”

Governor Haslam has says he’s trying to cut a deal with the federal government for permission to operate a hybrid Medicaid program in Tennessee, but those negotiations appear to be stalled.