On Monday, Gov. Bill Lee delivered his eighth and final State of the State address to a joint session of the Tennessee General Assembly, unveiling a slightly reduced budget from last year at $57.9 billion that focuses on education, public safety and rural health.

Among Lee’s key fiscal priorities this year is the expansion of his signature school voucher program which originally passed in 2019 and was expanded statewide last year. Citing strong demand from Tennessee families, Lee proposed doubling the number of families who can take advantage of school vouchers from 20,000 to 40,000. The $155 million expansion would bring the state’s total cost for the program to $310 million.

At the same time, the budget infuses additional revenue in Tennessee’s public schools, earmarking $339 million for Tennessee Investment in Student Achievement (TISA) formula funding, summer learning camps and teacher salary increases.

Lee also highlighted ongoing efforts to support public safety in Memphis, crediting a 55% reduction in Shelby Crime to the Memphis Safe Task Force. His budget seeks an $80 million investment to sustain the task force’s operations, allocating resources toward crime deterrence technology, workplace development initiatives and additional state trooper positions.

While healthcare has not been a focal policy priority of the Lee administration, the 2026-2027 FY budget reflects a renewed push to update regulatory frameworks the governor deemed “antiquated,” including Certificate of Need (CON) laws and scope of practice restrictions on primary care providers. The push appears related to the Trump administration’s Rural Health Transformation Fund, which ties dollars for rural health infrastructure grants to deregulation of these policies.

Though Lee’s calls to modernize regulatory barriers are well-intentioned, his scope of practice proposal remains at odds with TMA’s longstanding advocacy on preserving the team-based care model. The government affairs team is continuing to educate lawmakers about the importance of collaborative care models to ensure patient safety, quality of care and cost-efficiency.

For a full overview of the 2026-2027 FY budget, click here.

MEDICAL NECESSITY

The first of TMA’s priority bills advanced unanimously out of the Senate Health & Welfare Committee on Wednesday, paving the way for a smooth passage this session.

As amended, SB1753/HB1770 by Sen. Ferrell Haile (R-Gallatin) and Rep. Brock Martin (R-Huntingdon) updates Tennessee statute governing medical practice to keep pace with emerging technologies and healthcare delivery models. First, the proposal formally recognizes three newly identified specialties within the practice of medicine and osteopathic medicine, including:

• Clinical Informatics - medical practice incorporating mathematics, statistics, databases, software technology, etc. to improve patient outcomes and system efficiency,
• Lifestyle Medicine - medical practice focused on the prevention and long-term management of chronic diseases like diabetes, obesity and cardiovascular conditions
• Medical Virtualist - medical practice that utilizes cutting edge telehealth delivery systems to reach patients who may have limited or no access to specialty care

Second, the bill clarifies that all doctors—regardless of medical specialty—be governed by generally accepted criteria and appropriate standard of care when making medical necessity determinations. The bill clarifies that the Board of Medical Examiners has the authority to discipline physician licensees who do not follow these standards when assessing medical necessity. This language ensures all medical professionals are held to the same high standards.

While TMA member and pulmonary oncologist with Sarah Cannon Cancer Center, David Spigel, MD, was prepared to testify in favor of the legislation, lawmakers accepted the proposal without additional commentary. Though facing no opposition, the Tennessee Association of Nurse Anesthetists requested an amendment to clarify that the bill would not impact the practice act of nurses. This secondary amendment will be added to the House bill, and both versions will be reconciled when taken up for a floor vote in the coming weeks.