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1993.11.18 :  Welfare Reform Program in Tennessee

FOR IMMEDIATE RELEASE                   Contact: Anne Verano
Thursday, Nov. 18, 1993                  (202)  690-6145

HHS Secretary Donna E. Shalala today announced approval of federal
waivers that will enable Tennessee to reform its Medicaid program
and extend coverage to many uninsured citizens.

"Approval of the TennCare plan is consistent with the
administration's policy of encouraging states to develop
alternative programs to serve the health care needs of their
people," Secretary Shalala said.

The plan is a five-year demonstration project that will use managed
care organizations to deliver care to a million Medicaid
recipients.  TennCare will cover an additional 300,000 currently
uninsured in the first year.  The number of uninsured enrolled in
the program could reach 500,000 in the second year.

According to Bruce C. Vladeck, administrator of the Health Care
Financing Administration, "The project is designed to expand health
insurance coverage to many uninsured, low-income residents of
Tennessee and to assure access of all enrollees to appropriate and
high quality health care."

Enrollees with incomes above the federal poverty level will be
required to share some of the costs by paying premiums, deductibles
and copayments.

Tennessee will require managed care organizations to establish
delivery systems that assure recipients of access to primary and
specialty care.  The state is placing a high priority on the
provision of preventive health care services.

Under the demonstration, Tennessee will remove some limitations on
hospital and physician outpatient and inpatient care, prescription
drugs and laboratory and X-ray services.  Outpatient treatment for
substance abuse is one of the new services to be covered.

"To help protect the right of recipients to choose their own health
care providers, Tennessee will initiate a new enrollment process
for the uninsured and a re-enrollment process for Medicaid
recipients," Vladeck said.

Between now and the time that Medicaid recipients are enrolled in
health plans, they will continue to have access to their regular
providers under Tennessee's existing Medicaid program.

The Health Care Financing Administration is the federal agency
which administers the Medicaid and Medicare programs.