Tennessee Takes Control of Access MedPLUS; Insurer Asks For Chance to ‘Rehabilitate’

Tennessee officials on Oct. 18 won a court order allowing them to "seize" Access MedPLUS, the state's largest provider for TennCare, the state's Medicaid managed care program, the Nashville Tennessean reports. While the state may liquidate the insurer's assets to repay creditors, officials "agreed to consider" rehabilitating the company, which covers about 279,000 TennCare beneficiaries. As part of the Davidson County Chancery Court's order, Courtney Pearre was named "special deputy" for the seizure and will "basically run the business." Pearre has been the state-appointed supervisor of Access for more than a year (Snyder, Nashville Tennessean, 10/19). The Tennessee Department of Commerce and Insurance filed the court petition to put Access MedPLUS into receivership on Oct. 17. The petition said that Access MedPLUS' "financial condition justifies liquidation by demonstrating hazards to enrollees, providers and creditors without any recognizable ability to improve" (Kaiser Daily Health Policy Report, 10/18). On Oct. 16, the state terminated its TennCare contract with Access MedPLUS after a state audit found that as of June 30, the MCO had a $54 million negative net worth -- "well below" the $12.5 million the state requires for participating TennCare plans. Access MedPLUS has been under state supervision since May 2000 because of its failure to pay providers "accurately or on time" (Kaiser Daily Health Policy Report, 10/17). The Tennessean reports that company officials have asked the state to "allow them to restructure" and operate solely in West Tennessee. State officials must choose "rehabilitation or liquidation" by Nov. 2, when the court will hold a hearing on the company's fate. It is not yet known how the state takeover will affect outstanding claims.

MedPLUS Lays Off Workers
The Tennessean reports that Access MedPLUS yesterday laid off a large number of employees "without notice or severance pay." Former employees told the Tennessean that the business was "shutting down" and would operate with a "skeleton staff." Access MedPLUS spokesperson Phil West said, "Some layoffs have occurred, but we feel we will have adequate staff to ensure our (enrollees) get the quality health care they deserve." West did not specify how many workers had been fired.

BCBS Gears Up
Since TennCare has terminated its contract with Access MedPLUS, enrollees will shift to TennCare Select, a "back-up" plan run by BlueCross BlueShield of Tennessee. To "ease the transition," Access members will be permitted to keep their current physicians and providers for the first four months after the move. Since some members may switch plans in the next few days, BlueCross spokesperson Ron Harr said employees will be transferred from BlueCare, a different BlueCross TennCare plan, "to get ready for the influx of calls and processing claims" (Nashville Tennessean, 10/19). For further information on state health policy in TennCare, visit State Health Facts Online.