Budget Proposal Would Cut $201 Million from TennCare

TennCare would take the biggest hit of any state agency under budget reductions proposed by Governor Phil Bredesen.

Bredesen wants to pull nearly $201 million in state funding out of the Medicaid-waiver program. That would in turn mean a smaller draw-down of federal funds, for an overall cut of $496 million dollars from TennCare’s budget.

TennCare is the largest line item in the state budget. The governor says there was no way around making reductions there in a tough economy.

“We’ve tried to pick a set of them that gets to the numbers we need that has a minimum impact on the individuals on TennCare, but what that means is there’s a lot of stuff that has an impact on the providers of TennCare, and the hospitals are one of them that are going to have some difficulties with that, there’s no question about it.”

One key reduction would be a $10,000 annual cap on hospital stays. Bredesen contends that patients bumping against that cap would be in such serious condition that no hospital would release them early for lack of funds, meaning the facility would be forced to find another way to pay for that patient’s care.