Press Releases

Bredesen Congratulates President on Health Care Vote

Statement from Gov. Phil Bredesen, March 22, 2010:

“I congratulate the President on the passage of his health care legislation. This is a significant accomplishment for his Administration that will allow more than 30 million additional Americans full access to our health care system. I have long been a believer in the need for universal health coverage, and believe that this advances that goal.

“The expansion of Medicaid which is incorporated in this legislation presents some challenges to Tennessee, as it does to other states as well. We are starting the process of determining just what changes we’ll need to make to implement and pay for this Medicaid expansion, although most of the work in this regard will of course fall to the next Governor. I will work hard for the remainder of my term to prepare to implement this reform and transition to a much broader system of health coverage here in Tennessee.”

Health Care

TennCare Cuts Coming Soon

TennCare officials told lawmakers earlier this week they have no choice but to initiate significant cost-savings measures to the state’s Medicaid program.

The planned program-reductions include capping annual in-patient hospital-stay reimbursements at $10,000, and limiting the number of lab and X-ray services a person can seek per year at eight.

“We tried to put forth as best recommendation we can under an incredibly ugly set of circumstances,” TennCare Director Darin Gordon told the legislature’s TennCare Oversight Committee. “The alternative would be cutting direct services to offices and hospitals, and I’ve already gone into that well fairly deeply.”

Gov. Phil Bredesen has said there’s little alternative but to trim around 9 percent, or about $201 million, from of TennCare’s budget to balance the state’s books in the coming fiscal year. The agency is trying to reduce its total state-and-federal budget from about $7.6 billion to $6.8 billion.

Gordon said the decisions as to what to cut have been based on trying to “affect the least amount of people.” None of the proposed cuts would affect children or pregnant women, which he said make up the majority of the program’s enrollment, he said.

The proposed cuts could be softened somewhat by a federal Department of Health and Human Services decision last week to re-work a formula used to determine how much money the state owes the federal government in “clawback” funds, which are reimbursements for prescriptions by certain people in the program.

“It equates to about $120 million,” Gordon said. “I’ve already shot off a recommendation to the governor on how to appropriate those funds.”

Lawmakers nonetheless expressed concern that the cuts are going to hit many Tennesseans hard at a time when TennCare enrollment is increasing as a result of the prolonged recession. Scott Pierce, TennCare’s chief financial officer, said there were a few months last summer during which the program grew by over 8,000 enrollees per month.

Tennessee is not alone in its struggles with its Medicaid program. According to Gordon, 43 states have already implemented reductions in the program.

A Kaiser Foundation study found that “nearly 3.3 million more people (in America) were enrolled in state Medicaid programs in June 2009 compared to the previous June. It was the biggest ever one-year increase in terms of absolute numbers, and boosted the June monthly Medicaid enrollment by 7.5 percent to 46.9 million people nationally.”

Another TennCare cost-cutting proposal on the table, a potential 7 percent reduction in reimbursements to health care providers, is going potentially put some of them out of business, said Sen. Charlotte Burks, D-Monterey.

“Then my people are going to do without hospitals,” said Burks.

Dr. Wendy Long, TennCare’s chief medical officer, said the agency has already done all it can to reduce costs in other areas, including closer case management for patients, more pharmacy controls, and an increased emphasis on the prevention and detection of fraud and abuse.

“It’s not going to create immediate budgetary reductions we need to balance this year’s budget, but they are very important to minimize expenditure growth over time,” she said.

Press Releases

Reps. Maggart and Lynn Ask State AG to Intervene in Federal Health Care Legislation

Tennessee House of Representatives press release, Dec. 21, 2009:

On Monday, State Representatives Susan Lynn (R-Lebanon) and Debra Young Maggart (R-Hendersonville) asked Tennessee State Attorney General Robert Cooper to prepare to take the appropriate legal action against the federal government in the event HR 3200, the controversial federal healthcare reform legislation, passes into law.

The legislators requested this action in order to grant Tennessee relief from the unfunded mandate contained in the bill that Tennessee complies with the expansion of the federal Medicaid program.

The letter notes that under the bill Tennessee would be forced to expand the state’s Medicaid program potentially costing the citizens of the state $1.4 billion dollars in additional state taxpayer funds annually.

“Such an increase would place a great burden on the citizens of this state. It is clear by the wording of the legislation itself that not every state would face a similar and equal burden,” stated Rep. Debra Maggart.

Lynn explained that, “We see this as a violation of equal protection of the law, an affront to our sovereignty, and as a breach of the U.S. Constitution.”

Lynn and Maggart noted that the passage of this bill is imminent so it is important that the AG prepare now to take immediate action, and they referenced Governor Bredesen’s recent comment that “we can’t print money.” The great issue for the states is that states are not allowed to borrow money for operations expenses. “Obviously, this is something that many in Washington just don’t understand,” stated Lynn.

Press Releases

TCPR: Medicaid Expansion Would Wreak Havoc on State

Press Release from the Tennessee Center for Policy Research, Dec. 3. 2009:

NASHVILLE – The Tennessee Center for Policy Research today sent a brief to state lawmakers outlining the potential costs the proposed healthcare reform bills in Congress will have on the state. Both the House and Senate bills expand Medicaid eligibility, potentially devastating Tennessee’s budget. As a result, TennCare—the state’s Medicaid program—could become the health insurance option of nearly one in four Tennesseans.

According to the brief, titled “The Oncoming Tsunami of TennCare Costs” (pdf), the additional TennCare enrollees could cost Tennesseans as much as $1.4 billion. Governor Phil Bredesen (D), has properly referred to this expansion as “the mother of all unfunded mandates.”

TennCare already eats up a larger portion of the state budget than nearly every other state’s Medicaid program, and the proposed expansions would cause it to consume even more taxpayer money.

“The current rate of TennCare enrollment is unsustainable without a significant tax increase,” noted Justin Owen, the director of policy at the Tennessee Center for Policy Research. “Opening the door to even more enrollees by expanding eligibility would wreak havoc on an already troubled program and the state budget.”

Rather than add to the TennCare rolls, Owen suggests free market alternatives that would reduce TennCare recipients’ dependence on government and protect taxpayers’ hard-earned money.

The brief offers two simple, yet effective solutions to the problem. First, the Tennessee General Assembly should seek a Medicaid waiver that would allow TennCare enrollees to take more control of their healthcare costs. Second, the state’s congressional delegation should urge Congress to replace the current Medicaid matching system with block grant funding.

“Congress successfully reformed welfare in the 1990s by moving to a block grant program, and they should do the same now to fix the Medicaid debacle,” said Owen. “The move would eliminate states’ incentive to throw more money at the problem rather than find real solutions to provide healthcare coverage to those unable to afford it.”