TennCare reform: myths and realities

TennCare is Tennessee’s Medicaid program. TennCare operates under a special “waiver” from the federal Centers for Medicare and Medicaid Services (C.M.S.) exempting it from certain federal rules. Until mid-2005, the program served 1.3 million Tennesseans, including 625, 000 children. TennCare has a $7.5 billion budget, of which the federal government funds approximately 65%. As the state’s health care safety net, TennCare covers a wide range of Tennesseans and medical needs. TennCare is the largest single funder of treatment for medically fragile children and underwrites three fourths of all nursing home care for the elderly. TennCare is a major purchaser of prescription drugs in the state, the second largest source of hospital revenues and the financial cornerstone of services for people with mental disabilities.

In August 2005, the state began a six-month process that terminated coverage of 230,000 adults, or one out of every three adult enrollees. Patients who lost their health care include thousands of seniors, people with severe mental illness and patients with life-threatening diseases. The state has also cut services for those who remain on the program. The new policies cost Tennessee $1.2 billion in federal funds in Fiscal Year 2006 and leave Tennessee with a Medicaid program that, for adults, is one of the most restrictive in the nation. The changes will have far-reaching effects on Tennessee communities and on the health care system on which all Tennesseans depend.

Although the state is retaining the TennCare name, the result is to return to Medicaid, but with more limited adult coverage than Tennessee has ever had. To understand these momentous changes and their impact, it is important to separate myth from reality.

MYTH #1:
“TennCare was unaffordable, because the program had no limits on benefits.”

MYTH #2:
“TennCare is riddled with fraud and abuse that are soaking the taxpayer and making the program unaffordable.”

MYTH #3:
“Other states don’t have these problems, and Tennessee wouldn’t either, if we had never established TennCare to begin with.”

MYTH #4:
“The Governor has reformed TennCare and brought it under sound management, just as he promised when he ran for election.”

MYTH #5:
“Consent decrees, which were agreed upon by the state in the 1990s, prevented the state from implementing TennCare reform, and left the Governor with no choice but to cut the program.”

MYTH #6:
“The Governor has done everything possible to save TennCare.”

MYTH #7:
“Tennessee has the 7th most generous Medicaid program in the country, as measured by the percent of the state population on the program.”

MYTH #8:
“The state has created a safety net of programs to help everyone who loses their TennCare. Plus, the Governor has come up with a plan to preserve coverage for the 97,000  sickest and neediest people who are losing their TennCare coverage.”

MYTH #9:
“As the Governor has assured us, ‘Our state and our people will come through this just fine.’”

MYTH #10:
“There is nothing that anyone can do now to reverse the cuts.”

MYTH #11:
“TennCare was a budget buster.”

MYTH #12:
“TennCare has been a fiasco for both patients and health care providers.”

MYTH #13:
“TennCare has provided ‘platinum coverage’ for a few people at the expense of ‘bronze coverage’ for the many.  By cutting TennCare, so that it no longer pays for frills, the Governor has made it possible to provide access to a basic package at a price taxpayers could afford.”

MYTH #14:
“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.”

MYTH #15:
“Governor Bredesen had the right idea when he said he was going to manage TennCare just as he would his private HMO. TennCare should look more like commercial insurance.”

MYTH #16:
“The Governor has only cut TennCare benefits to bring them in line with commercial insurance, and that won’t hurt anyone. Some able-bodied adults may have to assume more personal responsibility for their own health, but that’s only fair.”

MYTH #17:
“Tennessee was spending more on its Medicaid program than any other state, and we just couldn’t afford it.”

MYTH #18:
“The Governor’s proposals had wide support. It was only a small group of advocates, and especially the Tennessee Justice Center who were ideologically opposed to any change and who rejected all invitations to collaborate in fashioning reforms that would save the program.”

MYTH #19:
“Cutting TennCare is necessary in order to fund pre-K and other education programs, and to raise state employee salaries.”

MYTH #20:
“The Governor’s TennCare changes are a ‘huge victory’ for children, who are absolutely protected.”