The state of Tennessee has unveiled a first-of-a-kind proposal to convert its Medicaid program into a block grant system. 

State officials released proposed details in mid-September. They planned to submit a final draft to federal authorities this month. 

Federal Medicaid funding currently pays states a percentage of healthcare costs for eligible beneficiaries. Under the proposal, Tennessee would receive its Medicaid funds in a lump sum. The amount would be calculated based on projected costs for providing care to its member population. 

The block grant amount for Tennessee was estimated to be $7.9 billion. If finalized, it would make Tennessee the first state in the nation to receive its Medicaid funding this way. 

Nursing home operators have traditionally opposed turning Medicaid into a block grant system. Jesse Samples, executive director of the Tennessee Healthcare Association, told McKnight’s that any alternative to Medicaid must ensure sustainability for the elderly population and preserve their choice to have nursing or assisted living services when necessary.