MYTH # 6:
“Getting rid of TennCare’s expanded coverage and returning to Medicaid was long overdue.  Now we can get back to manageable budgets, get the federal courts off our backs, and free ourselves from all the hassles.”

REALITY

Tennessee’s Medicaid program was in even deeper trouble in 1993, just before TennCare began, than TennCare is now. Tennessee’s Medicaid expenditures had nearly tripled between FY 1987 and FY 1993, and the program faced a half billion dollar deficit.1 In fact, because of medical inflation, Medicaid was a source of ever increasing budget problems for the state from 1980 onward.  The state violated federal Medicaid laws, beneficiaries were hurt, and the federal courts were required to enter a number of orders to enforce the law.2  When Tennessee switched to TennCare, it succeeded in shifting some state agency costs, including many mental health and public health services, to the federal budget. The cuts will require the state to reassume the full cost of those programs and services. And the state will ultimately have to cover many of those losing coverage, once they become disabled and more costly to treat.

 

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