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Tennessee’s TennCare Medicaid managed care program has sent $109.4 million to more than 100 hospitals and more than 1,500 individual and group providers who supplied most of the TennCare coverage last year.
The January 2001 payments came nearly five months after the state legislature promised the money.
While they say they are grateful for the payments, health care providers said the money covered only a portion of their TennCare losses.
John Tighe, state Finance Depart-ment deputy commissioner, says the agency was glad to be able to mail checks "to the providers who have helped us make this program work for the people we all serve, the members of TennCare. At the heart of TennCare are the doctors, hospitals, clinics, and the people who work in them, and they are the ones who truly serve the TennCare members."
The legislature appropriated $90 million in special funds to pay essential access hospitals, plus $5 million for a pediatric primary care pool, $2 million for community health centers, and $5 million for specialty outpatient providers — HIV/AIDS clinics, orthopedics, neurology, and dental. A separate allocation of $7.4 million will be paid to federally qualified health centers.
The formula for distributing the funds was developed by the comptroller of the treasury and the commissioner of finance and administration.
Under the formula for essential access hospitals, $38 million went to safety-net facilities, defined as a Level I trauma center and a regional perinatal center.
The remaining $52 million went to other essential access hospitals defined as other participating hospitals, Medicare-defined "sole community hospitals," children’s hospitals (allocated $4 million of the $52 million), and private psychiatric hospitals (allocated $2 million of the $52 million).
Factors for qualification of the "other essential access" hospitals were those with at least 14% TennCare utilization, based on TennCare-adjusted days, and those with more than 10% TennCare utilization, based on TennCare-adjusted days and more than 3,000 TennCare-adjusted days.
Factors for disqualification included hospitals with no unreimbursed costs (TennCare loss plus charity care and bad debt are greater than $0) or hospitals no longer participating in TennCare at the time of payment.
Craig Black, president of the Tennessee Hospital Association in Nashville, says that for many hospitals, the payments were the difference between a bad loss and a break-even year. "These payments were critical for the survival of some facilities," he adds.