Democratic Gov. Phil Bredesen said Tennessee will instead return to a
cheaper, more basic Medicaid program.


The move followed months of legal wrangling over the TennCare
program, whose $7.8 billion price tag was projected to mushroom in
coming years.


The governor held out some hope for saving the program, saying he
will try for seven more days to work out an agreement with advocates
who have won several court decisions about the level of health care
the state must provide to TennCare recipients. But he said such a
deal is unlikely.


"It pains me more than I can describe to take this path," he
said. "This is not what I planned for or what I dreamed about doing
as governor."


An attorney for the Medicaid recipients was also pessimistic about a
last-minute deal and accused the first-term governor of making
advocates into "scapegoats."


TennCare provides health care coverage for the poor, uninsured and
disabled, covering 1.3 million Tennesseans, or about 22 percent of
the state population. If TennCare is eliminated, some 430,000 of them
would be dropped entirely, largely families of the working poor and
those whose ailments and high medical bills make them uninsurable.
The remaining 900,000 or so would continue to get coverage under
basic Medicaid.


"Going back to a Medicaid plan will have a catastrophic effect on
thousands of Tennesseans who will no longer have health care
coverage," said C.E. "Mickey" Bilbrey, president and chief executive
of University Health System.


Almost all states offer some supplemental Medicaid benefits, but
Bredesen has said Tennessee has been more generous than other states.
Bredesen ran for governor two years ago on a promise to either fix or
end TennCare.


In the past, all TennCare participants had unlimited doctor visits
and prescriptions.


Bredesen has proposed a stripped-down TennCare plan that would limit
270,000 of the recipients to only 12 doctor visits and 45 days in the
hospital each year, and six prescriptions a month. But advocacy
groups have challenged that plan in court, and Bredesen said that
unless they back off, TennCare will have to be abandoned entirely.


Bredesen said there is a 60-day notification period to kill the
program and federal approval is required. Enrollees would have six
months before TennCare disappears.


The governor does not need legislative approval to end TennCare. The
federal government gave that power to the governor when the program
was created in 1994. Tennessee currently spends one-third of its
budget on the health plan.


The Tennessee Justice Center, which has led the court battle against
the governor's reforms, said the lawsuits will not go away even if
the state rolls back to basic Medicaid.