Congress Must Avoid Pitfalls of Tennessee’s Experiment
There is little detail about what a federal public option might ultimately look like or whether it will materialize at all, but Tennesseans have been down this road before and our experiences are noteworthy. We do not want to see the same mistakes repeated at the national level.
Our hopes are that health system reforms would sufficiently address the cost and access issues we see in today’s commercial health insurance market and negate the need for an additional public insurance option. However, if a public option provision is ultimately included by lawmakers and fails to address the problems witnessed with Tennessee’s experience with TennCare, the Tennessee Medical Association (TMA) will strongly oppose it.
The physicians of the TMA have continually shared their first-hand knowledge with lawmakers about a public insurance option based on their experiences with the TennCare program. Presently, we have a collective feeling of déjà-vu regarding any public option.
TennCare was launched in 1994 with the best of intentions, but was poorly implemented, sorely underfunded and too reliant on an infrastructure of disorganized managed care plans. Those mistakes caused physicians to forego or limit their participation, resulting in less choice for patients. Despite the unreasonably low reimbursement rates and unrealistic administrative hassles, some physicians reluctantly still chose to participate in TennCare for their patients’ sake.
Understandably, Tennessee physicians are leery of the public option scenarios being debated in Washington. If Congress ultimately chooses to include a public insurance option, it has to avoid the missteps experienced in Tennessee:
1. Program design must focus first on quality care, access, disease prevention and health maintenance. TennCare’s primary intent was to rein in costs. Health care delivery issues were secondary.
2. Patients and the physicians who care for them must be integrally involved in the final design. In TennCare, provider input to final rules was mostly ignored.
3. Administrative processes must simplify care for patients and providers alike. Tennessee went from a single Medicaid program and one set of rules to eight programs, all with different policies and processes. Providers who simply wanted to care for patients were buried in convoluted, inconsistent and costly administrative functions (formularies, pre-certifications, eligibility verification).
4. Adequate networks of physicians and facilities must be verified before launch. TennCare patients had coverage but found it difficult to find physicians in network to provide their care. The program did little to hold the managed care organizations responsible for ensuring network adequacy.
5. Reimbursement rates and general program funding must be adequate and based on sound actuarial principles. TennCare promised too many benefits for too many people and the projected savings due to better management never materialized. Below-cost reimbursement rates were the root of provider dissatisfaction and unwillingness to participate.
6. Program communications and access to information is critical. In TennCare, practices waited for hours for patient eligibility verifications, referrals and pre-certifications. Providers were not notified for weeks of coverage changes, yet were ultimately held liable, both operationally and financially.
7. Commercial insurers cannot be allowed to shift high risk patients to the public rolls. TennCare was a bonanza for commercial insurers that found it easy to deem thousands of high risk/high cost patients as uninsurable, thereby dumping them into the TennCare program.
8. Any requirement to follow strict care guidelines and protocols must be matched with liability protections. TennCare employed strict and limited protocols such as drug formularies that altered or limited patient treatment options. The choice of delivering care that was needed versus delivering care according to coverage increased the chance of unintended outcomes, thereby raising the liability risk for doctors and hospitals.
Tennessee physicians warned officials throughout the creation and implementation of TennCare of the program’s shortcomings. Eventually our fears played out as the TennCare program had to be severely cut back, thousands of patients were dropped from the rolls and benefit limits were put in place. Our State could not -- and today, still cannot -- afford its TennCare program as promised.
An overarching concern right now is how Washington plans to pay for it. We have heard the sales pitch before and have seen the results here in Tennessee. Our country cannot go down that same path. If a public insurance option is not truly a fair competitor in the marketplace, we will end up with a defacto single-payer health system that leaves patients and providers with no options or choices in their health care.
If a public option provision is ultimately included by lawmakers, it should be a true competitor to the private sector and cannot be continually bolstered financially by our tax dollars, destined to consume even more of our national economy.
While we will not support any public insurance option that fails to address the issues we experienced with Tennessee’s TennCare program, some kind of government-operated insurance program may be plausible. However, we have yet to see a workable plan from our lawmakers.
The TMA’s message to its members and patients is not to get too anxious about what they read or hear; the real debate is just beginning. A final bill does not yet exist in the Senate and our best opportunity to be heard is right now. Any reform measures still have huge hurdles to clear and we are committed to staying active in the process to voice the opinion of the TMA every step of the way.
Read the TMA's official position on Health System Reform .
Visit the TMA's Health System Reform web page.