Statement of the Tennessee Justice Center in Response to

Remarks of Governor Phil Bredesen regarding the TennCare Program

November 4, 2004

Gordon Bonnyman, executive director of the Justice Center, stated,

ìWe have offered since the Governor released his plan to sit down and identify specific changes they want to make in any of the agreements they made last year. We respect the Governor and remain willing to try to find common ground."

If the state decides to return to the Medicaid program, it will cost many vulnerable Tennesseans, including children, their lives. The Governorís own consultants pointed out that that would not save the state money. The proposals made by the state will cost Tennesseeís economy $2 billion in federal funds each year and will damage a health care system on which all Tennesseans must rely. There are better, safer, proven ways to save money, such as reducing overpayments to the HMOs and identifying the overprescribing of costly drugs. We hope the state will consider carefully before taking actions that will endanger lives and prove costly to Tennessee taxpayers. 

Relevant facts about the TennCare litigation

The consent decrees that are now at issue were all either negotiated or reaffirmed last year by the current administration. The same consent decree which is now described in such negative terms in the waiver application was described in a press release issued by the Governorís Office on August 27, 2003, as having a ìtremendous positive impact on the future of the programî. When the agreement was submitted to the District Court for approval, the state represented that:

[The modifications] are designed to enable the State to achieve substantial savings, thereby obviating other TennCare reductions in benefits and/or eligibility that would be harmful to members of the plaintiff classÖBy materially advancing the Stateís ability to stabilize and preserve the TennCare program, and without cutting eligibility or the TennCare benefits package, this settlement well serves the public interest.

Within weeks of the Governorís speech of February 17th, the Tennessee Justice Center wrote to the Administration expressing support for the Governorís goals, and offering to discuss how to avoid conflict with federal law and the terms of the settlements negotiated last year. TJC has repeatedly and consistently offered such discussion over the past 8 months. The Administration has refused those offers, demanding instead the complete suspension of the promises made last year.

McKinsey & Company concluded that ìA move to Medicaid would therefore require Tennessee to contribute additional money from state funds, largely offsetting the savings from reducing enrollment.î  (Second report, p. 84)

The only case now in litigation,  John B., enforces the early and periodic, screening, diagnosis and treatment (EPSDT) provisions of federal law pertaining to children. Administration officials testified under oath that compliance with those requirements would not require additional funding. Indeed, because of the emphasis of preventive care for children, it might produce savings.