Senator Bailey announces historic investments in rural health


Senator Paul Bailey (R-Sparta) is praising Tennessee’s successful, one-of-a-kind TennCare waiver for generating $300 million in shared savings for the second year of the program, known as TennCare III. The savings will be reinvested to expand and improve healthcare coverage for Tennesseans, at no additional cost to taxpayers. Governor Bill Lee is proposing a five-year plan to use the shared savings to invest $208 million in rural healthcare and almost $100 million in behavioral health and substance abuse support.

“The success of the TennCare waiver has been remarkable,” said Bailey, who is Chairman of the Senate Commerce and Labor Committee. “Through excellent conservative fiscal management, we can keep taxes low and provide better care to more citizens in need. We have an opportunity to transform rural healthcare in Tennessee by reinvesting the savings made possible by our innovative TennCare waiver and top-notch management at TennCare. This is how government can and should work for its citizens. I am proud of our work and am committed to ensuring it continues.”

The innovative waiver, made possible by legislation sponsored by Sen. Bailey in 2019, allows TennCare to recoup savings from federal Medicaid dollars through efficient and effective management of the TennCare program. TennCare III has generated $600 million in shared savings for the first two years of the program.

 Specifically, the governor’s proposal seeks to use the shared savings to strengthen rural healthcare by allocating:

  • $70 million for apprenticeships and skilled training
  • $67.8 million to improve career pathways
  • $50 million to the Health Care Resiliency Program
  • $12 million to establish hospital and physician practice grants through new Center of Excellence
  • $5.3 million for greater access to specialty care and telemedicine

“This proposal focuses on solving a major issue in rural health: a shortage of providers,” added Bailey. “We know that good providers in a rural community can drastically improve the quality of care for its citizens. I appreciate Governor Lee for bringing this proposal. As it makes its way through the General Assembly, I will fight to improve rural healthcare every step of the way.”

If approved, the $208 million would be the largest investment in rural healthcare in state history.

In the coming weeks and months, the General Assembly will review Governor Lee’s budget proposal and make its own budget recommendations, which will include how to reinvest the shared savings from the Medicaid waiver.

In 2023, the $300 million in shared savings were reinvested to enhance TennCare benefits and serve 25,000 additional Tennesseans with a focus on babies, children, pregnant women and parents.          


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