Rural Hospitals Face Closing Unless State Provides More TennCare Funds, Officials Say

Unless they receive additional funding from TennCare, Tennessee's Medicaid managed care program, some of the state's hospitals are "in danger" of closing and sending patients "longer distances for care at ... larger safety-net hospitals," hospital officials have said. The majority of hospitals facing closure are either rural or psychiatric facilities, the Nashville Tennessean reports. In 2000, the state provided $90 million to hospitals with a "disproportionately high" number of TennCare and charity patients, but this year's state budget would allocate $14 million, or $40 million when combined with federal matching dollars. Bill Young, senior vice president and general counsel of Tennessee Hospital Association, said, "Many hospitals -- most of them rural and psychiatric facilities -- won't get the funds they need to balance their budgets." Although only a "handful" of rural hospitals face closing, the impact would also be felt by larger, urban hospitals that would absorb the overflow of patients, the Tennessean reports. TennCare spokesperson Lola Potter said, "[W]hether or not rural hospitals can survive has nothing to do with TennCare. TennCare may help (but) we can funnel only so much money to them." She added that "cuts in Medicare reimbursement -- not inadequate TennCare funding" are responsible for the hospitals' "financial pinch."

Mental Health Also a Concern
Mental health services under TennCare also need to be "restructured," mental health advocates told members of the Legislature's TennCare Oversight Committee this week. During a two-day committee meeting that ended Aug. 16, advocates said the state is "providing services to only a fraction of children with severe emotional disorders." The fact that admissions to psychiatric hospitals under TennCare Partners, which covers behavioral health services, have risen 50% during the last four years indicates that the state is not spending enough on community-based services, the advocates added (Snyder, Nashville Tennessean, 8/16). For further information on state health policy in Tennessee, visit State Health Facts Online.