After months of expectations, Governor Phil Bredesen outlined his plan for TennCare on Monday, one which calls for severe a severe reduction in enrollment and benefits, while maintaining full coverage for children.

Bredesen announced the “basic TennCare” plan in Nashville, less than a month after the Christmas deadline previously set for deciding the program’s future. When talks with public interest groups involving consent decrees in effect against the state’s healthcare program broke down, Governor Bredesen predicted the cuts as the only solution to the program’s survival.

Under the basic TennCare plan 323,000 adults will be cut from the plan. The remaining 396,000 individuals eligible for Medicaid will continue to receive "reasonable" but reduced benefits. The reductions do not affect the 612,000 children on the plan.

“It might not be the level of care we want to provide, but it’s the level of care we can afford without bankrupting our state,” said Bredesen. “We’re putting limits into what has been the most generous healthcare program in the nation.”

Bredesen had long maintained that many of TennCare’s problems were the result of extensive pharmacy and hospital allowances granted to attendees. Doctor visits, prescriptions, and in-patient hospital stays, which had been unlimited under the original TennCare plan, have been reduced significantly under the basic plan. Enrollees will now be limited to 12 doctor visits a year, four prescriptions a month, and 20 days of in-patient hospital care. These and other reductions are expected to save the state $575 million during the next fiscal year.

Enrollee advocate and attorney Gordon Bonnyman,who has long opposed reductions to TennCare, called the “basic” plan cuts “worse than any natural disaster that the state has ever experienced.” Bonnyman, a lawyer with the Tennessee Justice Center, has argued that the TennCare cost problems could be fixed in part by soliciting additional federal funds for the program.

“Instead of very drastic and dramatic cuts, there are other things that other states have done that we haven’t, said Bonnyman. “I would work with the federal government ... and if it means making the case for federal relief, then I would do it and I wouldn’t be bashful.”

The governor’s plan also calls for managed care organizations (MCOs) to assume more financial risk in the delivery of TennCare benefits. This is one of the few solutions both Bredesen and advocates like Bonnyman had agreed on.

Bredesen hopes to have the “basic TennCare” plan substantially in place by 2006, with changes beginning as early as April, pending federal approval.

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