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Hicky letter confirms: State can afford to restore coverage now
Savings from basic pharmacy management exceed projections

In an October 6, 2005 letter to Gov. Phil Bredesen, Commissioner J.D. Hickey announced very good news regarding TennCare’s financial health and management. The letter reveals that the state is saving at least $324 million annually through better management of TennCare’s pharmacy program – savings that are purely from management, not from cutting enrollment or limiting medicines. Further, these are the very same management tools that TennCare advocates have supported for many years.

Governor Bredesen and Commissioner Hickey should be congratulated for this achievement, and should claim this victory in a tangible and life-saving way.

"This positive pharmacy news is attributable to factors beyond just the disenrollment and monthly prescription limits," Commissioner Hickey wrote. Specifically, the increased use of generics has resulted in annualized savings of $24 million. And the use of computer checks on prescriptions – "edits" that track past drug utilization and identify overuse, potential interaction, or the availability of cheaper alternatives – has resulted in a stunning savings of $300 million annually.

Commissioner Hickey mentioned other management savings, but did not quantify them in the letter. He also noted that these management reforms are still taking hold.

Download pdf of original letter from Hickey

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