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The Associated Press April 29, 2010, 3:27PM ET

Senate approves hospital fee to avoid TennCare cut

The Tennessee Senate on Thursday approved a bill to allow state hospitals to pay a fee to avoid $659 million in TennCare cuts.

The measure sponsored by Republican Sen. Doug Overbey of Maryville passed on a 25-5 vote on Thursday. Four of the votes against the bill came from Republicans, including one who is running for governor and two running for Congress.

Overbey said the bill would bar hospitals from passing on to patients the $239 million assessment they are raising to draw down federal funds.

Democratic Sens. Beverly Marrero and Jim Kyle said they supported the measure because of the likelihood that the financially strapped Regional Medical Center in Memphis would close if it isn't adopted.

The House version is scheduled for a vote on Monday.

Senate Speaker Ron Ramsey of Blountville, who is running for the GOP gubernatorial nomination, would only say he voted against the bill because "the timing wasn't right for me to do it right now."

Republican Sens. Jim Tracy of Shelbyville and Diane Black of Gallatin, both of whom are running for Congress, also voted against the bill. The other votes against the measure were cast by Sen. Lowe Finney, D-Jackson, and Sen. Mae Beavers, R-Mt. Juliet.

The board of the Tennessee Hospital Association in February unanimously endorsed an "enhanced coverage fee" to be placed on hospitals.

Democratic Gov. Phil Bredesen had originally proposed cutting $201 million from the state's expanded Medicaid program to help balance the states budget. Those cuts would be averted through the hospital assessment.

The Centers for Medicare and Medicaid Services have approved similar plans in at least 26 other states, according to the Tennessee Hospital Association.

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