FEDERAL COURT ISSUES FINAL GRIER RULING

RULING FOR STATE ACKNOWLEDGES TENNCARE FISCAL CRISIS

NASHVILLE, Tenn. – The State of Tennessee today welcomed the ruling in the latest legal battle involving the long-running Grier v. Goetz case filed by TennCare legal advocates. U.S. District Court Judge John T. Nixon ruled in support of the states efforts to modify the Grier Consent Decree of 2003, citing “the worsening of TennCare’s fiscal crisis” and “the public interest in long-term reform” to TennCare.

“We appreciate the Court’s careful study of this complex issue, and the Judge’s ruling in favor of the State’s efforts to control TennCare spending with long-term reforms to the program,” Finance & Administration Commissioner Dave Goetz said.  “While we do not agree with everything in this opinion, this ruling and aggressive management reforms have allowed us to regain control of the TennCare program. The result is that for the first time in nearly a decade, we are not facing a TennCare fiscal crisis as we put together the new budget for 2006.”

“We are pleased that this legal matter has concluded, but we are not happy that the Tennessee Justice Center lawyers are dragging TennCare back into court tomorrow in another TennCare legal hearing.   The last thing the state of Tennessee needs right now is to waste taxpayer dollars in court and to slow down TennCare reforms.”

The Court found that certain provisions of the 2003 Consent Decree are “unnecessarily burdensome and contrary to the public interest, thereby requiring modification” of the Consent Decree.   The Court also rejected legal advocates’ argument that the State could remedy the situation temporarily by patching the TennCare budget hole for this year without regard for future growth projections.  The Court found that “alternative reform efforts” presented by legal advocates “could not effectively tackle the crux of the State’s problem: that of sustaining one of the nation’s most progressive and generous Medicaid programs in a state that has one of the nation’s lowest tax burdens per person.” 

The state’s attorneys are still reviewing the judge’s 106 page ruling and the court has directed the state to file a Revised Consent Decree within 90 days.  In July, Judge Nixon issued rulings allowing the State to move forward with changes to the TennCare program, while maintaining health care coverage for 97,000 Medically Needy TennCare enrollees.  And In May 2005, the US 6th Circuit Court of Appeals upheld the right of the State to disenroll non-Medicaid eligible adults from the TennCare program finding that the state’s procedures complied with federal law and constitutional requirements of due process.