Sustaining the health of TennCare program

Tuesday, April 17, 2001 at 1:00am

TennCare, the state's $3.4 billion health care program, covers nearly 1.4 million low-income, disabled and once uninsured citizens. This is almost one-fourth of Tennessee's population.

At the beginning of this year, the state had contracts with eight private managed-care organizations (MCOs) that process and pay claims to providers, such as doctors and hospitals. TennCare covers roughly 800,000 people who qualify for the indigent, federal Medicaid program, mainly because they are low-income or disabled. More than an additional 500,000 people are covered because they previously lacked private insurance or were uninsurable due to pre-existing medical conditions.

Last fall, a blue-ribbon panel appointed by Gov. Don Sundquist early in 2000 and led by former state comptroller William Snodgrass concluded that, although troubled, TennCare should be preserved essentially intact. However, to make the program "more affordable, equitable and sustainable," the 18-member panel offered more than 50 recommendations.

One of the biggest problems with which the panel had to deal is the fact that companies often deny coverage to sick employees, knowing that TennCare will pick them up as uninsurable. This has led to a huge influx of sick people into TennCare and has made it difficult for MCOs to adequately pay doctors, hospitals and other health care providers.

The panel recommended moving those 500,000-plus persons into two new programs. One, referred to as TennCare Assist, would provide lower-income people assistance to pay premiums in employer-sponsored health care coverage, but the employer also would have to contribute a reasonable amount for the premium.

The other program, known as TennCare Standard, would provide benefits to those people who do not have access to employer-sponsored insurance or who have been declared uninsurable. Participants under the latter program would have to pay premiums on a sliding scale based on their income, and the existing MCOs would provide their benefits.

TennCare receives two-thirds of its funding from the federal government in the form of matching funds

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