TennCare cuts again blocked in federal court

U.S. District Court Judge William J. Haynes said the appeals process was one of eight areas where TennCare enrollees’ rights weren’t fully protected.

“It’s a victory for the people of Tennessee,” said Gordon Bonnyman, chief legal advocate for the Tennessee Justice Center. “The appeal process is a basic tool for holding government accountable to its citizenry. That’s why it was written into the constitution.”

TennCare spokesman Michael Drescher said the state has requested the hearings “be granted based on valid factual appeal,” but he’s unsure if that will happen.

“There’s no way to know precisely how many we could expect,” Drescher said.

Haynes’ order drew a sharp reaction from state lawyers, and attorney Michael Kirk immediately asked for a stay. Haynes denied the motion, saying all TennCare enrollees cannot be cut until the state complies with proper notification and appeals procedures.

State officials said they will appeal to the 6th U.S. Circuit Court, arguing that enrollees should not be allowed to appeal loss of coverage from the $8 billion expanded Medicaid program unless there’s a factual error with their paperwork.

“We cannot practicably conform to what the court has ruled,” Kirk said, citing the impact on the state budget if the enrollment cuts are delayed for hearings.

Drescher said the state has about $100 million in reserve to handle current enrollees until the end of the fiscal year, after that he said the “delays could cost the state dearly to the tune of at least $44 million per month.”

“Our biggest problem is time,” Drescher said. “The state cannot afford to continue operating the program in its current form.”

Gov. Phil Bredesen announced Tuesday that he had struck a deal with one set of lawyers representing TennCare enrollees had struck a deal that would protect 100,000 of the sickest patients from cuts originally set to remove 323,000 adults from the billion program.

Kirk said Haynes’ ruling jeopardized that compromise.

“The bottom line is that if this stands, we will not have the financial ability to go forward” with keeping the 100,000 people on the rolls.

Haynes stopped the cuts once before this year and held hearings over whether they violated a consent decree. But before he could issue his ruling, the 6th U.S. Circuit Court of Appeals said he had overstepped his authority.

TennCare Director J. D. Hickey said earlier this week that the state would begin its disenrollment process Thursday if Haynes hadn’t ruled on a pending request for an injunction from the Tennessee Justice Center, the other lawyers representing enrollees.

Hickey said it would be at least 50 days before anyone lost TennCare coverage. Haynes’ ruling about the right to appeal would significantly lengthen the process and extend it into the next budget year, which begins July 1.

TennCare covers about 1.3 million poor, disabled and uninsured residents — nearly 23 percent of Tennessee’s population. Bredesen sought to cut the rolls to curb the growth of spending in TennCare after he couldn’t get TJC lawyers to agree to modify a series of consent decrees that have governed administration of the program.

Other proposals to reduce benefits for other TennCare enrollees are awaiting approval from officials with the federal government, which covers two-thirds of the program’s cost.

Drescher said Haynes’ ruling is even more frustrating because the federal government has approved the “procedural” part of the state’s disenrollment plan.

“We believe strongly that we comply with all the federal regulations as evidenced by the fact that the federal government has already signed off on all our processes and policies and procedures for disenrollment,” Drescher said.