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 an $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 the largest 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.

Since July 1, 2005, the state has cut about 225,000 adults. Patients being terminated include thousands of seniors, people with severe mental illness and patients with life-threatening diseases. The state is also cutting services for those who remain on the program. The new policies will cost Tennessee $1.2 billion in federal funds in 2005 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.