An Economic Assessment of TennCare Expansion in 2023

Author: Matthew Harris, Emily Pratt

Publication Date: March 1, 2023

Expanding TennCare will yield economic benefits in almost every dimension. In the very near future, expansion will have positive fiscal benefits and generate increased economic activity in the state. It will provide vital financial protection for rural hospitals, ensuring rural Tennesseans have access to health care, particularly for time-sensitive emergent conditions. In the longer run, increased eligibility will yield spillover effects to the state in subtle ways but in ways that have immeasurable impact. Expansion can help with the substance use epidemic, reduce disability and permanent exits from the labor force, and reduce rates of chronic illness (or at least empower patients and providers to treat them more efficiently). The program is more than self-funding, and the federal government is willing to provide Tennessee $1.3 billion to pursue an endeavor that yields nothing but benefits on net.