Wall Street Journal Examines New Tennessee Health Insurance Program

The Wall Street Journal on Wednesday examined Tennessee's new CoverTN health insurance program, which covers health care expenses of up to $25,000 per beneficiary per year. CoverTN is available to businesses in the state that have not offered health care benefits for at least six months and have fewer than 25 workers. Under the program, the company, the employee and the state each pay about $50 a month for the coverage. CoverTN offers two plans. One covers hospital stays up to $15,000 per year and pays $75 every three months for prescription drugs. The second plan covers $10,000 per year in hospital costs and $250 every three months for drugs. Copayments for both plans are $15 to $20 for a doctor's appointment and $100 for a hospital stay, and there are no deductibles. Blue Cross Blue Shield of Tennessee is administering the plans. CoverTN's coverage limits are "in sharp contrast" with other state plans that seek to provide more comprehensive coverage, the Journal reports. Some doctors and hospitals in the state refuse to accept CoverTN patients. Eighty-nine of the state's 138 hospitals are participating with CoverTN, as are about 10,000 of the state's 17,000 doctors. Franke Elliott, regional vice president for managed care at HCA, said that his hospitals are not participating in order to avoid "worsen[ing] our bad-debt issues." Alan Sager, a professor of health policy at Boston University, said that CoverTN is "flimsy insurance" that will "provide cover for employers to save money." University of Tennessee College of Medicine professor David Mirvis said, "It may be better than nothing, but it's not real insurance." Gov. Phil Bredesen (D) said that as he developed the plan, he met with people who "weren't interested in buying insurance for catastrophic events. They wanted access to the emergency room next month, access to the pharmacy next month." Bredesen said, "We know it's not perfect and not as comprehensive as we would like," adding, "But it gets people into the system" (Terhune, Wall Street Journal, 4/18).