In a “Great Day for Tennessee,” BlueCross Agrees to Stay In a Restructured TennCare

Tennessee Gov. Don Sundquist (R) announced Feb. 23 that BlueCross BlueShield of Tennessee has agreed to participate in a "dramatically restructured" TennCare, the state's Medicaid managed care program, the Nashville Tennessean reports. Blue Cross, TennCare's largest MCO, had previously announced they would leave the program on June 30 because of rising costs. The insurer's exit would have placed the "survival" of the program in jeopardy, as BlueCross' current 600,000 members constitute nearly 50% of the overall TennCare population. Listed below are the main provisions of the agreement, which will take effect July 1 and extend through at least the end of 2002:

• As part of a new regional distribution of MCOs in TennCare, BlueCross will serve only 300,000 members, all located in the eastern part of the state.
• BlueCross will assume risk for its members up to $33 million, which is "the amount of profit BlueCross estimates it has made on TennCare since the program began" in 1994. The state will cover all losses exceeding $33 million.
• BlueCross also will develop a "separate health plan to serve children in state custody and others with special needs," according to state Deputy Finance Commissioner John Tighe.
• For the first time since 1998, TennCare enrollees will be able to switch MCOs if they prefer.
• BlueCross will be joined in East Tennessee by MCOs Access MedPlus, John Deere and PHP. Middle Tennessee will be served by Access MedPlus, Xantus, Vanderbilt Medical Center's MCO (VHP) and a new MCO, Universal Care, while West Tennessee will be served by Access MedPlus, OmniCare, the University of Tennessee Medical Group TLC, Regional Medical Center and another new group, Better Health Plans.
• BlueCross will administer a statewide "backup" network of health providers, in case a local MCO is "unable to adequately serve its members."

Steps in the Right Direction
Citing the BlueCross agreement and last week's decision by the state to halt a plan to raise premiums and introduce co-pays for prescription drugs and physician visits, a Memphis Commercial Appeal editorial states, "TennCare officials are making a good-faith effort to show they are serious about putting the state's experiment in universal health care on the right course." The editorial states that the exit of BlueCross "would have dealt a severe blow to the program," and the addition of co-pays would have added to the recent exodus of health care providers from TennCare, since they would be responsible for collecting the payments. The editorial notes that TennCare is not in the clear yet -- if it can't enroll enough providers in the program by next month it will have to disassemble TennCare next January and switch to traditional Medicaid and CHIP programs. Stating that "more action is needed" to shore up TennCare and thus avoid causing thousands of Tennesseans to lose their health insurance, the editorial concludes that if TennCare fails, "Tennessee's noble experiment would be over and additional strain would be placed on local governments and hospital budgets, much of it from cost-inefficient emergency room care for non-emergency illnesses" (Memphis Commercial Appeal, 2/25).

A Dental Shortage
In an illustration of the problems still facing TennCare, the Memphis Commercial Appeal reports that there is a shortage of dentists accepting children enrolled in the program. While a "range of dental care" for children is covered by the program, TennCare officials estimate that fewer than 800 dentists currently care for the 552,000 TennCare enrollees under age 21. In contrast, 1,100 dentists served the state's Medicaid patients in 1993, the year before TennCare's introduction. Michele Johnson of the Tennessee Justice Center, a Nashville-based nonprofit public interest group, said, "It's a huge problem. There are almost no dentists to meet the needs of children statewide. There are some areas where there is no dentist in a three-county area who participates in TennCare." Dentists say that low reimbursements and late payments have caused them to leave TennCare, and have asked the state to establish a "carve-out" fee-for-service dental program to be funded separately, similar to one created for mental health services several years ago. TennCare spokesperson Lola Potter said a state report examining the costs of a carve-out program was due by April. Dr. Morris Robbins, a professor at the University of Tennessee College of Dentistry, said, "A carve-out program would be a step forward. It would earmark dollars for dental care" and possibly would lead to a "more manageable system" with less paperwork (Powers, Memphis Commercial Appeal, 2/26).