Appeals court rules state can proceed with TennCare cuts
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A three-judge panel of the 6th U.S. Circuit Court of Appeals said in a ruling issued from Cincinnati that a federal judge overstepped his authority in January when he stopped the state from making the cuts.
“This is a significant step in the right direction in our efforts to regain control of the TennCare financial crisis,” Tennessee Gov. Phil Bredesen said in a statement. “While there are still a number of hurdles to clear before we begin the process of restructuring the TennCare program, we are moving forward.”
Bredesen wanted to cut the rolls of TennCare to save money on the $8 billion expanded Medicaid program, and he got approval last month from the federal government, which pays two-thirds of the bill.
Lawyers for TennCare enrollees went to court to stop the enrollment cuts, and U.S. District Court Judge William J. Haynes granted their request pending a hearing last week.
The appeals court said Haynes improperly restricted “the state’s substantive policy choices in altering the TennCare program.” It said the consent decree only spelled out the procedures for disenrollment, but didn’t prohibit the state from eliminating people from the program.
The lower court’s order was based “on a mistaken reading of the consent decree, circuit precedent, and federal law … which do not permit the district court to impose substantive policy limitations on the state in its ongoing management of the TennCare program,” the panel wrote.
Tennessee Justice Center director Gordon Bonnyman, the main advocate for TennCare enrollees, said now that the court has made its ruling, the issue falls to the “public and their elected representatives.”
“If 323,000 people are cut from the TennCare program, every Tennessean in every city, county and community will feel the effects,” Bonnyman said.
Haynes said he wanted to review the state’s proposal to cut the rolls, and he started a hearing March 28 to make sure the state had considered all alternatives.
But in preventing the state from making policy changes to TennCare, “the district court has exercised authority that the consent decree does not give him,” the order said.
The state argued the district court should have jurisdiction only to ensure the state follows proper procedure when cutting people off TennCare.
TennCare serves about 1.3 million people — nearly 23 percent of the state’s population. The state has argued that drastic reform is necessary because keeping TennCare intact would require $650 million more in state spending — requiring deep cuts in almost every other budget area.
Henry Blaze, pastor of the Aggressive Baptist Church in Nashville, said half his congregation is on TennCare and that many “are going to die” without it.
“It’s disturbing,” Blaze said of the court’s ruling. “This is a question of life and death.”
While Bredesen said the state has “no other choice,” he said the disenrollment will not occur immediately because of legal challenges still before the district court concerning disenrollment procedures.
However, he said when the time comes, the “procedures will be orderly, clear and fair.”
In the nine-page order, the judges note that the state lawyers’ have said the cuts would not go forward for at least two weeks. It directs the state to inform the enrollee lawyers two days before sending out disenrollment notices, giving them a chance to pursue another legal injunction.
Nashville attorney George Barrett, allowed to intervene in the case a few months ago to help mediate a solution, said he hopes the governor will keep his word and try “to keep as many people covered as he can.”
“We do not doubt his resolve, and we look forward to helping him keep his word,” Barrett said in a statement. “We hope all Tennesseans will pull together toward this goal.”