The ax falls in Gov. Bredesen's budget recommendations — right on the necks of the needy
by Jeff Woods
As he begins his last year in office, Gov. Phil Bredesen is asked frequently about his legacy. Will he be remembered for his pre-kindergarten program, for landing the Volkswagen plant, or what? In a display of questionable modesty, Bredesen demurs and makes the improbable claim that he's not thinking about his place in state history.His questioners are too polite to point out the obvious, which is that Bredesen's legacy already is clear. Like Don Sundquist, who campaigned against the income tax and then tried to enact one, Bredesen will go down as the governor who promised to fix TennCare and then spent eight years ravaging it.
His latest assault comes in his new budget recommendation. Fittingly, the governor will go out of office still chopping away. Of the $400 million in new cuts in the recession-battered state budget that Bredesen's proposing, fully half would come from Tennessee's beleaguered version of Medicaid.
Perhaps predictably for the former HMO executive, the governor still seems not all that troubled by all the pain and suffering his cuts have caused to some of the sickest people in the state. In defending his new recommendations to reporters, he recalled the inconvenience of having to step over protesters outside his office back in 2005 when he eliminated health insurance for 200,000 people — most of them categorized as uninsurable in the private sector because of pre-existing conditions or chronic illnesses.
"The process we went through back in 2005 was extraordinarily painful," Bredesen said. "I mean, I didn't enjoy having protesters sleeping 24/7 in the hallway outside my office for six months." And that's "not to mention, you know, all the other impacts that it had," the governor quickly added, hoping to sound sufficiently concerned about any carbon-based life forms who might have been left to die without proper care.
Without much choice, given the state's dismal cash flow, legislators have allowed Bredesen to take his scalpel to TennCare in the past. This time, though, he's knifing into not only the benefits of voiceless poor people but also payments to health-care providers who have managed to maintain some clout in the political system. These are men of substance — i.e., election campaign contributors — and their distress is making lawmakers terribly uncomfortable.
The governor wants to cap Medicaid payments to hospitals at $10,000 for each patient. That means Nashville's General Hospital and the state's other charity hospitals will wind up holding the tab for enormous medical expenses — that is, if they don't start kicking out Medicaid patients once their bills hit $10,000. You can run up that much expense before you manage to snag a bed.
The Tennessee Hospital Association is yowling in protest, saying Bredesen would suck $526 million out of the health-care system and force hospitals across the state to close. General Hospital says it'll lose $10 million. The association's director, Craig Becker, calls it "Armageddon" for hospitals in this state.
"I'm not a man who's usually given to hyperbole, but this is one of those times," Becker says. "I truly don't see any way out of this. There's no way we can take a $526 million hit and it not have some impact. In many ways, the small rural hospitals are more vulnerable because they have higher percentages of TennCare patients. Will the city of Nashville chip in enough to keep General Hospital open? That I don't know. Every hospital that has a large number of TennCare patients will be in jeopardy."
But Bredesen scoffs at this. His solution is simple. It's right there on his spreadsheet. Charity hospitals need a new business model. All they have to do is stop caring for so many uninsured people who show up sick on their doorstep, and voilà! — problem solved. Until then, he says, they'll have to suck it up.
"That particular change is probably not going to hurt TennCare beneficiaries because if they have a serious enough illness to run up a $10,000 bill, they're not going to get thrown out of the hospital," Bredesen said. "I mean, they legally can't throw you out of the hospital. That's something the hospitals are going to have to absorb."
In response, Becker says, "The governor's a businessman and I respect him, but in this case, I don't think he gets it."
Hospitals are volunteering to tax themselves and then use the money to draw matching federal funds in the weird shell game that many states play to fund Medicaid. For every $1 of tax, the feds send nearly $3. That might shore up the system and keep hospitals open for another year.
But with elections coming up in November, it's not clear the legislature will go along even with this self-imposed tax. Their campaign opponents would slam them as tax-happy liberals, and lawmakers then would have to try to make voters listen to their explanations for why they did it. It's a political axiom in Tennessee: When a legislator opens his mouth, he loses votes.
