State Legislation Wrap-Up

The 2021 session of the 112th General Assembly adjourned on May 5, 2021 after passing a $42.6 B budget and legislation in the first year of a two-year legislative session. Learn more about key budget and legislative items here:
Health Care Safety Net Funding 
The Health Care Safety Net, administered by the Tennessee Department of Health was established in 2005 to provide primary care to uninsured adults in Tennessee.1 Health Care Safety Net funding supports Federally Qualified Health Centers (FQHCs) and Community and Faith-Based Clinics in delivering care to uninsured adults aged 18-64.  

The latest data from FY 20 indicates the Health Care Safety Net fund partially offset the cost of providing care to more than 145,600 Tennesseans and FQHCs provided more than 232,000 patient visits to uninsured adults.2  

Governor Lee's proposed FY22 budget contained a $2 million increase in recurring funding for the Safety Net, bringing total Safety Net funding to $21.9 million for FY 2022. An additional $3 million in non-recurring funding was added through a budget amendment in the TN General Assembly, for a total of $24.9 million. 
TennCare Coverage for Pregnant and Postpartum Women 
TennCare is the state's Medicaid program that providers health coverage to low-income Tennesseans, particularly low-income pregnant women, parents and caretakers of young children, and elderly individuals, or individuals with a disability.3  

According to a 2021 report from the Tennessee Department of Health, between 2017 and 2019, more than 220 mothers died from pregnancy associated causes within a year of pregnancy.4 More than two-thirds of those were of women with TennCare coverage when their child was born, and the majority of the causes were preventable.5 For black women the risk of pregnancy-associated death is 1.5 times higher than for white women.6 

In an effort to begin to address the troubling trends in maternal mortality, two programs to expand TennCare coverage were included in the FY 22 budget:
  1. $6.6 million for the first year of a three-year pilot program to extend postpartum coverage from 60 days to a full year
  2. $2 million to provide a dental benefit to pregnant women.  
The 340B Drug Pricing Program is a federal program that allows certain providers, including health centers to purchase outpatient medications at a discount and reinvest the savings into patient care. 

Third parties such as Pharmacy Benefit Managers (PBMs), insurers, and contract pharmacies have increasingly been retaining savings from the 340B program for themselves through a practice known as ‘discriminatory reimbursement.' This most often occurs when third parties provide lower reimbursement for 340B priced medications. 

To combat this practice, the Tennessee General Assembly passed SB1617/HB1398, a bill that contained PBM reforms, including specific reforms to address discriminatory reimbursement. The bill prohibits health insurance issuers, managed health insurance issuers, PBMs, and other third-party payers from:  
  • Reimbursing 340B entities less for drugs than non-340B entities 
  • Assessing fees, chargebacks, or adjustments on 340B entities that are not also applied to non-340B entities 
  • Excluding 340B entities from network of participating pharmacies 
  • Discriminating against a 340B entity in a way that prevents or interferes with patient choice 
Upon Governor Lee's signature, Tennessee will join states across the country in passing legislation to protect the 340B program.  

1. Tennessee Department of Health, "2020 Uninsured Adult Health Care Safety Net Report" Tennessee Department of Health, 2021,
2. Ibid.
3. "Tenncare Medicaid", Tn.Gov, accessed 19 May 2021,,the%20income%20and%20resource%20limits.
4. Tennessee Department of Health, "2021 Tennessee Maternal Mortality Annual Report" TennesseeDepartment of Health, 2021,
5. Ibid.
6. Ibid



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