Federal TennCare Agreement Leaves State $270 Million Short

NASHVILLE, Tenn. (AP) -- Tennessee has signed an agreement with the federal government that will leave the state with about $270 million less than needed to cover TennCare hospital costs for the next three years.

But state officials say the agreement is an improvement over an original proposal that would have left Tennessee with more than $385 million less than projected.

The long-delayed three-year agreement sets a $540 million annual cap on how much the state can draw from federal sources to help reimburse hospitals for treating Medicaid and uninsured patients.

(Copyright 2007 by The Associated Press. All Rights Reserved.)

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