TennCare Cuts Running into Resistance

Questions and criticisms surrounding a proposed reduction in the Bureau of TennCare’s mental health services has prompted Gov. Bill Haslam to reconsider the cut.

At a Senate budget hearing Monday, however, the TennCare officials continued to make their case for the reduction.

TennCare’s proposed budget is $10.3 billion. Of that, $3.3 billion is a state appropriation. The governor is proposing a $400 million budget reduction to the agency.

The budget proposal cuts $10.5 million from state dollars for providing outpatient care for the mentally ill. When coupled with lost federal matching dollars, the budget reduction is about $30 million.

Maryville Republican Doug Overbey, chairman of the Senate Ethics Committee, questioned TennCare officials about cutting millions from a line item that represents “2 to 3 percent” of the total budget.

Darrin Gordon, TennCare’s director responded that the structure for the agency’s reduction is because of their need to cut “a half-of-a-billion dollars,” and decisions about “what are areas that we can be tighter on, where are things we could do some things differently. This is on that list.”

Gordon added part of the problem was a “great variation in the system” as to who uses the program, how it’s used and for how long. Audits have uncovered “some things that do not fit the federal definition of case management,” he said.

The proposed reforms “are policy driven” to ensure “taxpayer funded benefits” are only being used when “appropriate,” according to emailed information from Kelly Gunderson, the Health Care Finance Administration communications director.

Individuals already receiving “Level 2” care and meeting “certain criteria” will “automatically receive the three months of services,” after which they will be evaluated to determine if continued case management is needed. The agency is also offering a 10 percent rate increase for behavioral health outpatient services, “to help promote the transition to a different treatment model,” according to the email.

“Continued case management without a discharge plan creates an unhealthy dependence and is contrary to good management of limited resources,” Gunderson’s email said.

Community behavioral care providers from across the state — including Centerstone in Middle Tennessee and Frontier Health in Northeast Tennessee — have called the cuts shortsighted.

Teresa Kidd, the chief executive officer of Frontier, told the Johnson City Press in February, those suffering from mental illness could have long periods of stability, followed by relapse and need for care. Those with poor mental health also have self-destructive tendencies that could lead them to hospitalization or encounters with law enforcement officials — something avoidable with case management, she said. Data from Frontier indicates that 65 percent of patients leave case management within three years.

Ben Middleton, the chief operating officer for Centerstone, made similar points to the Tennessean earlier this month. “Without tending to their issues, they could not only be a harm to themselves but to others,” he said,

Dave Smith, Gov. Bill Haslam’s spokesman, said via email, due to feedback received from around the state, “the governor wants to take a closer look” to ensure “that these services are being provided in the most efficient and effective way.”

The governor’s Office, TennCare and Finance Commissioner Larry Martin, “are coordinating to seek additional input from stakeholders,” before submitting the final budget to the Legislature.

Reductions in community and family care program funding proposed by the Tennessee Department of Intellectual and Developmental Disabilities at budget hearings late last year were largely avoided in the final budget proposal.