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Words To Know - Key Definitions

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Behavioral Health Organization (BHO)

The equivalent of MCO that “manages” only mental health and substance abuse services. Like MCOs, BHOs develop provider networks and determine whether or not TennCare enrollees get the services their doctors ordered.

Centers for Medicare and Medicaid Services (CMS)

The federal agency that oversees funding and regulation of the Medicaid and Medicare programs. This agency grants requests from states for federal waivers of Medicaid law. [top]

Dual eligibles

Individuals who are eligible to participate in both Medicare and Medicaid (or, as it is called in Tennessee, TennCare). [top]

Early Periodic Screening Diagnoses and Treatment (EPSDT)

The federal Medicaid law that applies to children 0-21. EPSDT was born when federal studies showed that those enlisted in our armed services were substantially weakened by untreated childhood illnesses. EPSDT promises children a comprehensive health benefit so that they can reach their maximum potential. [top]

Essential Access Hospital

A hospital that qualifies for direct TennCare subsidies, over and above fees received for the care of eligible TennCare patients. The total fund for Essential Access payment is $300 million. The fund is distributed at the sole discretion of Administration officials, and there is currently no public accountability or transparency regarding the calculation of allocations to particular hospitals, nor of spending by hospitals of these public funds. [top]

Families First

Tennessee’s program of Temporary Assistance to Needy Families (TANF), defined below. Families receiving cash assistance through this program are also entitled to TennCare coverage. [top]

Federal Match

Funds provided by the federal government in proportion to funds spent by states. Medicaid is a federal and state program. 2/3 of the TennCare program is paid for with federal dollars and 1/3 with state funds. [top]

Home and Community Based Services (HCBS)

Non-medical services that allow people with disabilities and the elderly to remain in their homes and communities rather than being placed in nursing homes or other institutions. HCBS services have been demonstrated to be cost-effective, since they are almost always cheaper than the cost of institutional care. People who need this level of care most often prefer HCBS to institutionalization—HCBS care is humane and promotes the dignity of the person cared for. Medicaid covers HCBS if the state opts to provide them. Tennessee ranks last in the nation at providing HCBS care for its citizens. [top]

Long Term Care (LTC)

Medical and other services provided to a person with a chronic or ongoing condition. This term encompasses both Home and Community Based Services and nursing home care. TennCare pays part or all of the cost of care for 75% of nursing home residents in Tennessee. [top]

Managed Care Organization (MCO)

Private health insurers who contract with the State to “manage” the care of TennCare enrollees. MCOs determine whether or a not a TennCare enrollee gets a particular service. They also are responsible for developing a network of providers to give medical services to TennCare enrollees. This is general term which includes the subset of plans which are HMOs. Examples of TennCare MCOs are TennCare Select-Blue Cross Blue Shield of Tennessee and Vanderbilt Health Plans (VHP). [top]

Medicaid

A health program begun in 1965 as a supplement to welfare programs for the aged, disabled, and families with dependent children. Medicaid is a federal grant in aid program that provides matching funds (see definition below) to state governments to cover certain groups of poor and near-poor Americans. Because of medical inflation, the program has grown to become the largest source of federal funds in state government budgets and, including such federal funding, the second largest state government expenditure after public education. Complex federal laws, regulations and policies regulate state administration, eligibility and benefits. States have wide latitude within those federal laws and policies to shape their Medicaid programs. [top]

Medical Necessity

The gateway to TennCare-covered services because Medicaid covers only services for eligible individuals which are medically necessary. TennCare has accordingly always had a definition of medical necessity. In May 2004, the Governor proposed and the legislature approved the most restrictive definition of medical necessity in the country. While the old definition held good medical practice as the standard of care, the new definition allows only coverage for the “cheapest” “adequate” level of care. If medical advice or no care at all is cheap and adequate, TennCare can deny providing any service. [top]

Medically Needy

A category of Medicaid eligibility. It is also called “Spend Down.” In order to qualify one must:

• Be categorically eligible - generally that means one must be a child under 21 or an adult over 65, disabled, pregnant or be the single parent of a child under 18.
• Have enough unpaid medical bills.
• Have low resources.

As of April 26, 2005 the Governor limited new Medically Needy (Spend Down) enrollment to women who are pregnant and children. Governor Bredesen has said he was going to re-open the Medically Needy enrollment to include those over 65, disabled or single parents of children under 18 but with much more restrictive policies on what will count as an unpaid medical bill. There is no word on the status of this as of October 2006 and new enrollment in the Medically Needy program remains only open to children and pregnant women. [top]

Medicare

A social insurance program, established in 1965 as an adjunct to the Social Security pension program, that provides health coverage for most Americans over 65, as well as some disabled workers. On January 1, 2006, Medicare added a limited prescription drug benefit, known as “Part D”. Medicare is entirely federally managed and it is administered uniformly across the country. [top]

Pharmacy Benefit Manager (PBM)

A managed care company that contracts with the State to manage the TennCare pharmacy benefit. The PBM’s duties also include educating providers and pharmacists in the TennCare network, negotiating supplemental rebates with the pharmaceutical manufacturers, conducting retrospective drug utilization reviews, and other tasks essential to the good management of a pharmacy benefit program. [top]

Safety Net

The program created by the State to provide limited care to some people who have been cut from TennCare. The “Safety Net” is a term of art created as a public relations description because it does not provide any assistance to the majority of people losing coverage. Major elements, such as a limited prescription drug discount program, are temporary and described as only intended to help people “transition” from TennCare. There are no other resources to which they will transition, once the temporary programs end. Total safety net funding is about $100 million state dollars. Because these funds are spent outside the TennCare program, they do not qualify for federal match. The safety net spending was publicized as an effort to mitigate the impact of TennCare cuts. These cuts eliminated $1.8 billion from the TennCare budget in this fiscal year alone. [top]

Temporary Assistance to Needy Families (TANF)

A public assistance program for certain poor families with children who have been deprived of support by the death, absence from the home, unemployment or disability of a parent. This is the “welfare reform” program that replaced the old Aid to Families with Dependent Children (AFDC) program that dated from the 1930s. In Tennessee, the TANF program is known as Families First. TANF programs provide a small cash benefit to program participants as well as non-cash benefits like job training and child care while the child’s caregivers are engaged in program activities. [top]

TennCare

Tennessee’s Medicaid program, which was restructured in 1994 under a special federal waiver (see definition). It has recently been fundamentally altered by Governor Bredesen with the approval of the Tennessee General Assembly and CMS. [top]

Uninsured

A TennCare waiver eligibility category for people who do not have “access to other insurance.” Since 1995, only a limited number of adults were able to enroll in this eligibility category. These adults were on Medicaid, lost Medicaid coverage (certain parents who received Families First, for instance), and were permitted to continue in this eligibility category. Prior to 2005, even if these individuals were very sick, they could roll on to TennCare without showing they were uninsurable. These are the second “sickest” group of people on TennCare. These people also pay premiums and co-payments based on their income and have since the inception of the program in 1994. [top]

Uninsurable (also referred to as “medically eligible” for TennCare)

A TennCare waiver eligibility category made up of adults who TennCare’s underwriters have found to be unable to access private insurance because of a pre-existing health condition. Since 2002, eligibility for this category was restricted to adults below 100% of poverty ($798/month for an individual). There were many thousands of uninsurables who enrolled on TennCare prior to 2002 and had incomes higher than 100% of poverty. These individuals, prior to their disenrollment, paid premiums on a sliding scale of up to $1,300/ months to keep their TennCare. They also paid co-payments based on their income since 1994. Taxpayers are not subsidizing health care for everyone enrolled in TennCare; those with higher incomes pay for themselves. The uninsurables are the “sickest” group enrolled in TennCare because as a whole they consume the most on healthcare. [top]

Waiver

Permission not to comply with certain aspects of federal law. Usually, state Medicaid programs must follow certain minimum standards set out in federal law. States can request permission to have parts of federal law “waived” in order to provide enhances services in their Medicaid program. In Tennessee’s case, Governor McWherter sought a waiver of several of those laws in 1993. The federal Government can waive compliance with certain standards if the state attempts to cover more people. In September 2004, Governor Bredesen sought to waive many parts of the Medicaid Act. Most of the requested waivers have now been granted and permit the elimination of eligible groups, health benefits and patient protections ordinarily required by federal law. [top]

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