Sitting hunched at their kitchen table strewn with papers, Loren and Shirley Ellis consider a grim choice: their home or their medicines.
The couple could sell their brick home in Columbia, Tenn., a rural town south of Nashville, and Mr. Ellis, a former restaurant owner, could return to work. That would provide enough cash for healthcare for his wife, diagnosed with ovarian cancer and bipolar disorder. Or Mrs. Ellis could give up chemotherapy and the eight medicines she takes daily. That's the prospect they face if Mrs. Ellis is dropped by TennCare, Tennessee's health plan for the poor and uninsured.
"You walk around your house and ask yourself, 'How long? How long am I going to be here?' " she says.
Many Tennessee households face a similar cutoff as the state proceeds with removing some 191,000 residents from its expanded Medicaid plan.
Across the country, states are working to rein in healthcare costs under the crush of medical inflation and anticipated federal cuts to Medicaid. Tennessee's struggles have drawn national attention, partly because TennCare was hailed as a model when it was launched a decade ago, and partly because, according to critics, the cuts are the most comprehensive ever to a state health plan.
Before the cuts, 1.3 million Tennesseans received $8.7 billion in benefits - more per capita than any other state plan. Tenn-Care achieved this by using federal matching funds and managed-care organizations, which cut state costs while covering more Tennesseans than the state Medicaid plan it replaced.
But TennCare spun out of control, most observers agree, because of myriad structural, financial, and management problems. By last year, the program consumed one-third of the state budget. Costs would have jumped $650 million - or about 7.5 percent - this fiscal year, which started July 1, says Marilyn Elam, a TennCare spokeswoman. That's why Gov. Phil Bredesen (D) ordered the cuts, arguing the program's benefits were just too generous.
"In Tennessee we cannot sustain the unlimited program that we've had," Ms. Elam says. "Our state can't afford it any longer."
Last fall, the governor threatened to scrap TennCare. Since then, enrollees like the Ellises have been at the whim of dizzying litigation and legislation as the courts and lawmakers have battled over what to do.
The couple braced for the worst after Mrs. Ellis got a letter from the state, warning that she would be dropped from Tenn-Care by the end of August. The couple filed an appeal and got a reprieve until the end of the year, but they don't know what to expect after that.
Because Tennessee was once seen as a leader in the arena, others are watching now to see what happens. "There's a lot of curiosity," says Joy Wilson, health-policy director for the National Conference of State Legislatures. "Is it that you can't do it or is it that Tennessee didn't do it right?"
Those who stand to lose TennCare benefits are the uninsured (residents who can't get insurance from employers) and the uninsurable (those whom private insurers won't take on because of pre-existing conditions). Children are spared, and so are those eligible for Medicaid and Medicare, though they will see cuts to drug and other benefits.
An additional 100,000 enrollees deemed medically needy because their health costs would plunge them into poverty unless they get assistance, were rescued from being cut this week when the governor announced they could remain, thanks to a court ruling allowing cost-saving changes to TennCare. The Ellises hope Mrs. Ellis eventually will be deemed part of this category.
For enrollees still facing a cutoff, the state has set aside $100 million to help soften the blow. Dropped enrollees can get some generic drugs free of charge through the end of the year. A discount card will help them buy other medications. The mentally ill will get additional help.
The state also has set up a dial-a-nurse service, offering health advice over the phone, and a hot line explaining all these services to dropped enrollees. And Tennessee is providing money to local health departments and community clinics.
But watching the on-again, off-again cuts wind their way through the courts and legislature has put many enrollees through an emotional wringer.
"You're a small person against some powerful forces," says Jesse Howell, a former telemarketer, now unemployed, who joined other protesters who have camped inside the state capitol for more than 40 days.
"It's terrible anxiety. It's like worrying about where your next meal is going to come from."