DSH in Tennessee Act
- Bill Number
- S. 3299
- Origin Chamber
- Senate
- Congress
- 119th Congress, Session 1
- Policy Area
- Health
- Status
- Introduced
- Latest Action
- 2025-12-02: Read twice and referred to the Committee on Finance.
- Last Updated
- 2026-01-09T15:17:30Z
AI-Generated Summary
Purpose
The "Delivering Support for Hospitals in Tennessee Act" (S. 3299) aims to ensure ongoing federal funding support for hospitals in Tennessee that serve a high number of low-income patients. It does this by establishing a permanent allotment of Disproportionate Share Hospital (DSH) payments—extra Medicaid funds to help hospitals cover costs for uninsured or low-income care—starting in fiscal year 2026. This addresses a gap in funding for Tennessee due to its unique Medicaid program, called TennCare, which operates under a special federal waiver.
Key Provisions
- Restoration of DSH Allotment: Tennessee will receive a DSH allotment every year beginning with fiscal year 2026, overriding previous limitations tied to its TennCare demonstration project (a temporary federal experiment allowing states to customize Medicaid).
- Amount for Fiscal Year 2026: The initial allotment equals Tennessee's DSH amount from fiscal year 2015, adjusted upward each year by changes in the Consumer Price Index (CPI), a measure of inflation for everyday goods and services.
- Ongoing Adjustments: After 2026, Tennessee is classified as a "low DSH state" (states with historically lower needs for such payments), and its allotment will increase annually in the same way as other low DSH states—typically based on a fixed percentage or formula tied to national Medicaid spending trends.
- Scope: The changes apply only to Tennessee and integrate into the existing Medicaid DSH framework under Title XIX of the Social Security Act.
Significant Changes to Existing Law
- Amends Section 1923(f)(3) of the Social Security Act by expanding references to include a new subparagraph (G) specifically for Tennessee, ensuring it is no longer excluded from permanent DSH funding due to its waiver status.
- Overrides temporary or demonstration-based restrictions that previously limited or eliminated Tennessee's DSH payments after fiscal year 2015.
- Shifts Tennessee from a potentially zero-allotment status to one with guaranteed, inflation-adjusted funding, treating it like other low-needs states for future years.
Potential Impacts
- On Government Agencies: Increases federal Medicaid spending through the Centers for Medicare & Medicaid Services (CMS), which administers DSH payments; this could add to the national budget without requiring new state matching funds from Tennessee.
- On Citizens: Benefits low-income and uninsured residents of Tennessee by supporting hospitals that provide essential care, potentially improving access to services in underserved areas and reducing financial strain on these facilities.
- On International Relations: No direct impact, as this is a domestic health funding measure.
- Overall, it stabilizes hospital finances in Tennessee, which could prevent service cuts or closures, indirectly aiding public health during economic challenges.
Main Stakeholders Affected
- Tennessee Hospitals: Primary beneficiaries, especially those serving disproportionate numbers of low-income patients, gaining reliable federal revenue to offset uncompensated care costs.
- Low-Income Tennesseans: Indirectly supported through sustained hospital operations under the TennCare program.
- Federal and Tennessee Governments: The U.S. Department of Health and Human Services (via CMS) handles distribution; Tennessee's state government benefits from reduced pressure on its Medicaid budget.
- Medicaid Beneficiaries Nationwide: Minor effects, as reallocating DSH funds to Tennessee could slightly influence the pool available for other states.
Notable Legal, Constitutional, or Political Implications
- Legal: Strengthens state-specific flexibility in Medicaid by carving out an exception for Tennessee's waiver program, potentially setting a precedent for other states seeking similar adjustments; ensures compliance with federal Medicaid rules while addressing historical funding shortfalls.
- Constitutional: No major challenges anticipated, as it involves congressional spending authority under the Spending Clause (Article I, Section 8) and does not infringe on state sovereignty.
- Political: Highlights bipartisan support in Tennessee (introduced by Senators Blackburn and Hagerty) for state-tailored health policy; could influence future Medicaid reform debates by emphasizing permanent protections for demonstration states, amid ongoing discussions on federal health funding equity.
This summary was generated by AI and may contain inaccuracies. Refer to the official source document for the authoritative text.
Sponsor
Cosponsors (1)
Recent Actions
- 2025-12-02: Read twice and referred to the Committee on Finance.
- 2025-12-02: Introduced in Senate
Bill Versions
- Delivering Support for Hospitals in Tennessee Act — issued 2025-12-02 — PDF (3 pages)