What to know about Tennessee's new Medicaid diaper benefit

Tennessee could soon be the first state in the nation to cover part of the cost of diapers for babies on the state's Medicaid program, TennCare.

With $30 million in funding approved last month by the state legislature, TennCare is working to get federal approval and implement a benefit offering half of the diapers a baby needs for the first two years of life. The benefit is expected to be in place by January.

"We are the first state that provides relief for the cost of diapers for mothers for the first two years," Gov. Bill Lee told reporters during a recent news conference. "I think we're in a really unique spot in Tennessee, we have the only Medicaid waiver in the country that is this modified block grant."

Tennessee has not expanded Medicaid under the Affordable Care Act, and Democrats have criticized Lee and legislative Republicans for not doing so. The expansion would expand coverage to as many as 200,000 additional Tennesseans.

Instead, the Lee administration pursued a modified block grant approach to TennCare, with the goal of using savings to add additional benefits.

A burden lifted:Tennessee to offer first-of-its-kind Medicaid diaper benefit

"This is a model for other states potentially to… expand the number of people that can be served, expand the services that we can provide to Medicaid recipients, and to do so, not only without additional cost to the state, but in a way that actually incentivizes lowering the cost of health care to those who receive it," Lee said.

Here's what to know about the new benefit:

Unlike food, diapers are not targeted by any in-kind federal assistance program – no food stamps, or WIC benefits cover them. About one in three families in Middle Tennessee struggle to provide the diapers their infants need.

Without enough diapers to keep a baby clean and dry, infants are at higher risk for diaper dermatitis and urinary tract infections. Most daycare facilities require parents to provide a day's worth of diapers for their child – which poses a significant burden to families facing financial insecurity.

Lee proposed the benefit during his first State of the State address since the overturning of Roe v. Wade as a "pro-life" and "pro-family" use for savings realized in the state's new Medicaid block grant funding structure.

Implementation of the new benefit now depends on approval from the federal Centers for Medicare and Medicaid Services. CMS approval involves a formal proposal by TennCare, followed by an open comment period for the public to respond.

"This is a first-of-its-kind Medicaid benefit," TennCare Communications Director Amy Lawrence told The Tennessean. "No other state has done this, so it might take a little bit more time for CMS to approve it, but we’re hopeful that they will."

If CMS moves quickly to approve the plan, the benefit could become available to families on TennCare by January 2024.

TennCare will provide half of the total average number of diapers needed by an infant each month for each child eligible for the benefit. TennCare is working to calculate the quantity of diapers the benefit will provide each month.

Any child who is a TennCare member under 2 years of age at that time will be eligible for diapers until they turn 2 regardless of when they enrolled into TennCare, Lawrence said. Mothers, parents and caretakers are not required to be TennCare participants to obtain the diaper benefit for their child.

Funding for the benefit comes from the $330 million in savings the state realized by restructuring how the state receives Medicaid funding from the federal government in a new system known as a modified block grant.

Lawmakers approved $30 million in funding last month specifically for the diaper benefit, which will first become available when the state budget goes into effect on July 1.

Right now, TennCare is planning to run the benefit through participating pharmacies, similar to how the department handles over-the-counter drugs.

"We would get participating pharmacies to code it, bill it to us and then people could go through their pharmacy to get diapers," Lawrence said.

A variety of diaper brands will be covered by the benefit to allow parents to choose the best fit for their child, and account for skin sensitivities and other needs. Approved brands are still being determined.