TennCare enrollees could see benefit cuts

NASHVILLE — Thousands of nonpregnant adult TennCare enrollees could face a $10,000 annual cap on hospital stays if 9 percent cuts in the program take place, officials said Wednesday.

Other benefits such as physical and occupational therapy also would disappear, they said.

Hospitals, meanwhile, are looking at a reimbursement “ceiling” that would cap their state reimbursements at no higher than 100 percent of reimbursements under Medicare.

TennCare Director Darin Gordon and top aides outlined the potential cuts to Gov. Phil Bredesen during a second day of public hearings on ways to save hundreds of millions of dollars in the upcoming 2010-11 budget.

“Governor, obviously these are difficult decisions,” Mr. Gordon said.

Officials laid out estimated total cuts of $773 million if 9 percent reductions are demanded on TennCare, Tennessee’s version of Medicaid.

But the budget also gives TennCare $176 million in savings from recent enrollment cuts as well as $354 million funding from the federal government for enrollment growth — an additional 63,000 low-income adults and children expected to enter in 2010-11 because of the worst economic times since World War II.

TennCare, which largely covers low-income pregnant women and children, now enrolls about 1.2 million.

Overall, TennCare’s budget would go from $7.6 billion in state and federal dollars in the current 2009-10 budget year to $7.04 billion next year.

Mr. Gordon said the situation would have been even worse if the state had not moved to control costs in pharmacy and other programs in recent years, as well as cut recipients from TennCare rolls.

All state agencies have been asked to submit plans cutting their budgets by 6 percent for the 2010-11 budget that takes effect July 1. But the governor also asked them to present him plans to slash another 3 percent if state revenues continue their plummet.

Under the 6 percent scenario, the state would try to save $17.8 million on TennCare by imposing the reimbursement ceiling on hospitals. It also hopes to save $39.7 million through better integration of nursing home services into managed care.

Benefit limits would take place under the added-on 3 percent “worst case” scenario. Basing figures on a previous year, Mr. Gordon said limiting hospital stays to $10,000 could affect about 5,620 nonpregnant adults and save an estimated $51.2 million.

Limiting lab and X-ray procedures to no more than 15 per year could affect 15,149 nonpregnant adults and save $8.8 million, he said. Eliminating all physical, occupational and speech therapy for nonpregnant adults could affect 16,297 people and save $3.3 million, he said.

“A lot of that is going to fall on hospitals,” Gov. Bredesen said, but he added that he didn’t think hospitals will just cut people off.