Bredesen: Tennessee Health Plan ‘Opposite’ of Massachusetts

Massachusetts may be getting a lot of attention for a new law requiring health insurance for all state residents, but in Nashville, Tennessee Gov. Phil Bredesen is happy to be taking what he calls the opposite approach.

Bredesen, a Democrat, takes delight in noting that his Cover Tennessee plan takes a market-based approach, while Republican Massachusetts Gov. Mitt Romney is creating a mandated system for his state’s residents and businesses.

With similar sized populations, Tennessee, 6 million, and Massachusetts, 6.4 million, are both estimated to have more than a half-million residents who are uninsured and don’t qualify for Medicaid.
But on the question of how to cover the uninsured, said Bredesen, they are “two states that are stepping out on this at the moment with very different approaches.”

Romney, who is weighing a run for the Republican presidential nomination in 2008, on Wednesday signed legislation that would require residents to have health insurance, just as the state requires drivers to have auto insurance.

Romney vetoed a $295 per employee annual fee on businesses that do not provide their employees with coverage, but Legislative leaders said they plan to override that veto.

Bredesen’s Cover Tennessee proposal is just starting its way through the legislative process but is not expected to meet much resistance in the state’s General Assembly.

The plan would feature an affordable, and optional, health plan for businesses and low income workers to buy into.

“If group health policy in Massachusetts costs $11,000 a year, you can mandate all you want, there’s plenty of businesses that can’t afford that,” said Bredesen. “We’re trying to find a more sensitive way, and a more business-friendly way to put this together.”

The Cover Tennessee plan calls for a $150 monthly premium for basic health insurance, with the state kicking in $50. The individual would be responsible for the remainder, though businesses would be given the option of paying half.

The program would limit benefits, for example the number of nights for hospital stays, instead of requiring a high deductible to keep costs down for the insurer.

“It might not be the insurance for a motorcycle accident, but let’s make sure that people can get in and see the doctor if they need to,” Bredesen said.

Pending legislative approval, the state plans to bid out the plan to two private insurance companies in September and to be up and running by the end of the year.

Optimistic estimates have 100,000 Tennesseans enrolling within three years. That contrasts with the Massachusetts plan designed to guarantee coverage for virtually all residents by July 2007.

But Massachusetts officials estimate the cost of their health care package at $316 million in the first year, rising to more than a $1 billion in the third year. Tennessee would only invest about $100 million over the first three years.

The failure of TennCare, the state’s expanded Medicaid program that at its height was one of the most generous government-sponsored heath care programs in the country, remains the rallying cry for the pared-down approach being offered by Bredesen.

TennCare costs led Bredesen to consider jettisoning 430,000 of the poor and disabled from the system. That number was ultimately whittled down to about 191,000 who were disenrolled last year, a process the governor describes as “painful.”

“I have never been through anything like that in my life,” said Bredesen, who ran a publicly traded health care company before entering politics. “I didn’t run for office to tell people that they no longer have health care.”

So Bredesen is doing his best to keep the program from becoming a new entitlement, and from letting federal rules interfere with state control over the program.

In the end, Bredesen said, he wants to give low-income workers the opportunity to buy health insurance for the same cost as their monthly cable television bill.

“And then it’s up to them,” Bredesen said. “This is still America, and if you decide to put your money into something else, that’s your choice.”