Unemployed Tennesseans are now receiving taxpayer-subsidized insurance benefits as a result of Gov. Phil Bredesen’s (D) decision to expand the state’s “Cover Tennessee” program to include unemployed and “underemployed” residents.
Health policy analysts criticized the move as an attempt to shore up enrollment in an ineffective and unpopular program.
Making Little Difference
Cover Tennessee was established in 2006 to reduce the number of uninsured adult Tennesseans, which then stood at 715,000, according to U.S. Census figures.
The program, which provides coverage of no more than $25,000 per year through Blue Cross Blue Shield of Tennessee, is paid for by enrollee premiums, employer fees, and state tax dollars. Individuals’ premiums vary based on age, medical history, and behaviors judged by the state to affect health, such as tobacco use.
In its three years of existence, Cover Tennessee has cost taxpayers $251 million.
The number of uninsured in the state has fallen to roughly 566,000, according to the University of Tennessee’s Center for Business and Economic Research, representing a decrease of 149,000, but only 15,000 of those are enrolled in Cover Tennessee, Bredesen’s office admitted.
Expanded Eligibility
Bredesen proposed the new eligibility category, called “Tennesseans Between Jobs,” earlier this year. It was approved by the state General Assembly in May and went into effect in late September.
Tennesseans Between Jobs opens Cover Tennessee eligibility to individuals “who have worked at least one 20-hour week in the last six months and earned $43,000 or less in income annually,” according to a statement by Bredesen.
New enrollees are expected to pay two-thirds of the normal Cover Tennessee premium, Bredesen said, with the remaining one-third being added to the state taxpayers’ share of the cost.
Unpopular Program
Analysts and legislators criticized the move as an expensive expansion of an already-ineffective program, implemented in hopes of increasing its currently sparse enrollment.
“I’m not paid what I’m worth—does that mean I’d qualify as ‘underemployed?’ ” asked Michael Cannon, director of health policy studies at the Cato Institute.
“The fact is, you can have a government that constantly tries to expand its control of the health care sector in order to ‘guarantee’ coverage to more and more people, or you can have a health care sector that makes care better, cheaper, and safer, and actually helps the less fortunate among us by providing them with quality, affordable care. You cannot have both,” Cannon added.
“Cover Tennessee hasn’t attracted anywhere near the number of enrollees its creators hoped for or led us to expect,” said Tennessee state Rep. Susan Lynn (R-Mt. Juliet). “This eligibility area was opened up in an effort to make the numbers work, because at current enrollment the program is too sparsely populated to be solvent.”
Unrealistic Expectations
A better idea than continuing to expand the state’s subsidized program, said Lynn, would be to implement market-based reforms that decrease onerous mandates and regulations and allow the costs of health care to come down.
Unfortunately, she said, government programs have become so comprehensive, and costs such as payroll taxes and employer contributions have become so well-hidden, “people no longer expect to have to pay anything for health care.
“We have built up people’s expectation that health care should and will be free,” Lynn concluded.
Joe Emanuel ([email protected]) writes from Georgia.
