Tennessee health insurance

Five insurers offer 2020 individual-market health plans in Tennessee. Short-term plans can have terms of up to 364 days.

Health insurance in Tennessee

Tennessee resistance to ACA’s reforms

State legislative efforts to preserve or strengthen provisions of the Affordable Care Act

Tennessee is among the states that have done the least to preserve the Affordable Care Act’s gains.

Tennessee can be counted among the states with higher uninsured rates and a bit more resistance to the Affordable Care Act. As such, it opted for a more hands-off approach with a federally facilitated exchange and has not yet expanded Medicaid.

The state has also allowed non-ACA-compliant Farm Bureau plans to continue to be sold to healthy residents, resulting in an ACA-compliant risk pool that’s sicker than average states.

Open enrollment for ACA-compliant 2020 health plans has ended, although Tennessee residents with qualifying events can still enroll or make changes to their coverage for 2020. The next open enrollment period, for plans effective in 2021, will begin November 1, 2020.

200,445 people enrolled in private individual market plans through Tennessee’s exchange during the open enrollment period for 2020 coverage. Enrollment peaked in 2016 (as was the case in most states that use HealthCare.gov), when 268,867 people enrolled. Enrollment has declined since then, under the Trump administration.

Health insurance premiums in Tennessee’s individual insurance market decreased for 2019 and decreased again for 2020. But that followed two years of sharp increases, in 2017 and 2018. In August 2016, Tennessee’s insurance regulator had described the state’s exchange “very near collapse” after she approved 2017 health insurance rate increases averaging 44 percent, 46 percent and 62 percent for Humana, Cigna, and Blue Cross Blue Shield, respectively. But things have stabilized considerably since then.

Options in the individual health insurance market in Tennessee dwindled for 2017. BlueCross BlueShield of Tennessee left the state’s three major metro areas where it covered a majority of individual enrollees, although they re-entered the exchange in the Knoxville area for 2018, because Humana’s departure in that area would otherwise have left 14 counties with no insurance options at all.

And for 2018, average premiums spiked again in Tennessee’s individual market, increasing by an average of 28.5 percent (most of which was due to uncertainty caused by the Trump Administration).

So the influx of new insurers to Tennessee’s market in 2019 — the state now has five insurers offering plans in the exchange — and the overall average rate decreases in 2019 and 2020, have to be viewed in conjunction with the fact that insurers left the exchange in past years, and the ones that stayed implemented hefty rate increases in 2017 and 2018.

Read our overview of the Tennessee health insurance marketplace.

Medicaid/CHIP enrollment

Tennessee made headlines in 2019 with the enactment of HB1280, which directed the state to seek federal permission to implement a block grant funding model for TennCare (the state’s Medicaid program), instead of the current open-ended federal matching funds. Critics of the legislation note that block grants are likely to result in reduced Medicaid funding over time. No Democrats were included on the House committee that worked on the block grant legislation, and the legislature was fraught with tension over the issue.

The ACA called for Medicaid to be expanded to cover all Tennessee residents with incomes up to 138 percent of poverty. In 2012 however, the Supreme Court ruled that states could opt out of Medicaid expansion, which Tennessee has done so far.

Because Tennessee has not expanded Medicaid, there are an estimated 117,000 impoverished residents in the coverage gap, with no access to financial assistance for their health coverage.

Exchange subsidies for private plans are not available for those who earn less than poverty level, and non-disabled childless adults are not eligible for Medicaid in Tennessee, regardless of income (although parents with dependent children can get Medicaid in Tennessee if their household income is up to 101 percent of poverty – a more generous threshold than many of the other non-expansion states use).

Read more about Medicaid in Tennesseeand.

Tennessee’s CO-OP closed in 2015

The ACA included a provision to create Consumer Oriented and Operated Plans (CO-OPs). In Tennessee, Community Health Alliance Mutual Insurance Company was an ACA-created CO-OP, and was one of Tennessee’s five exchange carriers in 2015. But in October 2015, the Tennessee Department of Commerce and Insurance announced that Community Health Alliance would discontinue operation at the end of the year.

Several CO-OPs closed at the end of 2015 – including Tennessee’s – due in large part to the fact that the federal government was only able to pay out a fraction of the money insurers were owed under the risk corridor program.

Read more about the Affordable Care Act’s CO-OP health plans.

Short-term health insurance in Tennessee

Tennessee does not have state legislation limiting the duration of short-term plans, so the state defaults to the federal rules. Those rules  allow short-term health insurance plans to have initial terms of up to 364 days, and total duration, including renewals, of up to 36 months.

Read more about short-term health insurance in Tennessee.

Did Obamacare help Tennessee?

Despite an overall aversion to the Affordable Care Act, Tennessee’s population has seen improved health insurance coverage under the healthcare reform law. The state’s overall uninsured rate has dropped from 13.9 percent in 2013 to 9.5 percent in 2017, although it rose to 10.1 percent in 2018. Although the uninsured rate is lower than it was in 2013, it’s still higher than the national average of 8.9 percent. That’s due in large part to the fact that Tennessee has refused to accept federal funding to expand Medicaid under the ACA.

Tennessee lawmakers generally opposed to the ACA

Donald Trump, who campaigned on a promise to repeal and replace the ACA, easily won Tennessee in the 2016 election.

In 2010, Tennessee’s U.S. Senators Lamar Alexander and Bob Corker (both Republicans), voted against the ACA. In the House, four Republican representatives voted no while five Democratic representatives voted yes. Alexander is still in the Senate, although Corker retired and did not seek re-election in 2018. But his replacement, Marsha Blackburn, is strongly opposed to the ACA (prior to her election to the Senate, Blackburn was the Budget Chair in the House, and was thus responsible for shepherding the American Health Care Act (an attempt to repeal the ACA) through the House in 2017). The U.S. House now has just two Democratic representatives from Tennessee, and seven Republicans.

Former Governor Bill Haslam, a Republican, worked with the Obama Administration to try to gain approval for his modified version of Medicaid expansion, and he met with then-Secretary of HHS Sylvia Matthews Burwell in July 2014 to continue the discussions he had been having with Secretary Sebelius. Haslam said he would like to expand Medicaid to cover another 161,000 low-income Tennessee residents, but he wanted higher co-payments than the Obama Administration HHS would allow, and no compromise was reached.

Haslam was term-limited and could not run in 2018. His successor, Bill Lee, also a Republican, won by the election by a substantial margin.

The Trump Administration is allowing states to impose work requirements on their Medicaid populations, which was a non-starter under the Obama Administration. Tennessee enacted a law in 2018 that directed the state to seek federal approval for a TennCare (Tennessee Medicaid) work requirement. The waiver proposal was submitted to the federal government in late 2018, and was still pending approval as of early 2020.

Tennessee has allowed non-ACA-compliant Farm Bureau plans to continue to be sold to healthy Tennessee residents, which has resulted in a less healthy risk pool for the ACA-compliant market in the state. Tennessee has long regarded Farm Bureau plans to be separate from the insurance industry, so they’re not regulated by the state’s rules that apply to insurance. By opting to continue that practice in 2014 and beyond, Tennessee allowed those plans to continue to be sold to healthy applicants. They were the only state in the country that allowed this for the first few years of ACA implementation, but Iowa joined joining them in 2019, as did Kansas in 2020.

Tennessee Medicare

As of December 2019, there were 1,364,396 Tennessee residents with Medicare coverage.

Read more about Medicare coverage in Tennessee, including specifics about Medicare Advantage and Part D plans, as well as the state’s approach to Medigap (Medicare Advantage) plans.

State-based health reform legislation

Tennessee’s legislature has been quite active in the arenas of healthcare and healthcare reform, but not all of their legislation has been beneficial to the state’s residents.

In 2018, Tennessee enacted legislation that directed the state to seek federal approval for a Medicaid work requirement. And in 2019, the state enacted legislation that directs the state to seek federal approval to transition the state’s federal Medicaid funding to a block-grant system.

Also in the 2019 session, Tennessee enacted H.B.655, which allows any healthcare professional to use barter agreements when treating uninsured patients.

And H.B.1342, which was also enacted in 2019, strengthens protections against surprise balance billing by requiring medical facilities to provide patients with written notification — at least three days in advance of a medical procedure — if they’ll be receiving services from an out-of-network provider at the facility. The state already required facilities to provide these notifications to patients, but the legislation adds the provision that the disclosure be provided at least three days in advance. Out-of-network physicians who fail to provide the necessary disclosures will not be allowed to balance bill the patient.

You can find a summary of recent state-level health reform bills at the bottom of this page.

Louise Norris is an individual health insurance broker who has been writing about health insurance and health reform since 2006. She has written dozens of opinions and educational pieces about the Affordable Care Act for healthinsurance.org. Her state health exchange updates are regularly cited by media who cover health reform and by other health insurance experts.

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