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TACIR staff propose a contract addendum to unblock TennCare school-based reimbursement
Summary
TACIR staff reported progress toward resolving a contract barrier preventing some districts (Knox, Metro Nashville) from signing managed-care agreements for Medicaid reimbursement of school-based services; TennCare agreed to test an addendum with Knox County and stakeholders cited administrative and credentialing burdens as ongoing obstacles.
TACIR staff briefed the commission on efforts to remove contractual and administrative hurdles that have limited school districts’ ability to obtain TennCare reimbursement for school‑based health services.
Staff noted that statewide TennCare reimbursements for school‑based services totaled about $3.95 million for calendar year 2023 and that TennCare and the managed‑care organizations recently agreed to explore a contract addendum to address concerns raised by Knox County Schools and Metro Nashville Public Schools. Those districts’ attorneys had advised them not to sign existing MCO contracts because some language appeared to obligate districts to deliver services beyond typical school capacity, such as comprehensive prenatal services, potentially creating liability and operational concerns.
TennCare agreed to develop and test an addendum with Knox County Schools; if feasible, TennCare could consider requiring the addendum for MCO contracts with other districts. Staff also described other improvements: expanding reimbursable services (including certain nursing services tied to IEPs), extending the claim‑filing window to 365 days, and authorizing certain therapists to issue orders supporting medical necessity in IEPs (Public Chapter 695, Acts of 2022), which stakeholders said increased eligible reimbursements.
Districts still report that the administrative workload — documentation, provider credentialing with multiple MCOs, and front‑line staff time — can outweigh expected reimbursements unless districts hire dedicated billing staff or contract with vendors. Staff described proposed technical solutions (single credentialing pipelines or TennCare pass‑through) but said they may require structural changes to Tennessee’s managed‑care model or new investments.
Commissioners asked for more detail on the services implicated by the contract language and requested that staff continue to work with TennCare and MCOs to pilot and refine the addendum.
