Tennessee legislation · 114th General Assembly

Tennessee HB1864: AN ACT to amend Tennessee Code Annotated, Title 71, Chapter 5, Part 10, relative to medicaid reimbursement for medicaid nursing facilities.

Status: Chaptered, May 26, 2026

Fiscal Summary STATE GOVERNMENTREVENUENursing Home Assessment Trust FundFY26-27$198,498,900 EXPENDITURESNursing Home Assessment Trust FundFY26-27$198,498,900 FEDERAL GOVERNMENTEXPENDITURES FY26-27$346,005,000 OTHER FISCAL IMPACT The Governor’s proposed FY26-27 budget, on page A-28, includes revenue recognition in the amount of $184,877,200. Corresponding nonrecurring appropriations in the amount of $507,138,100 ($184,877,200 state and $322,260,900 federal) are also included on page A-36. If the nursing home assessment is extended for subsequent years after FY26-27 there will be an increase in expenditures during the next rebase year, and each additional year thereafter. Based on the most recent rebases conducted by the Division of TennCare the initial increase is estimated to be approximately $99,069,100. Bill Summary Present law requires each nursing home to pay an annual nursing home assessment, the proceeds of which are paid into the nursing home assessment trust fund ("fund"). The fund must be used exclusively to make expenditures to nursing facilities under the TennCare Program at the full rates for the specified fiscal year; to provide funding for the implementation of an acuity-based reimbursement system; and to pay nursing home covered services covered for medicaid beneficiaries within medicare upper payment limits. This bill requires the funds to be used to make expenditures for nursing facility services under the TennCare program for the 2026-2027 fiscal year. Further, this bill extends the nursing home annual assessment fee through June 30, 2027. Present law does not require the bureau of TennCare to procure additional funding to make payments for the purposes described above if the money in the fund is insufficient. Instead, the bureau of TennCare is authorized to reduce all payments on a pro rata basis. Thi