Members of Tennessee Tax Revolt, Inc., an all volunteer, non-partisan taxpayer advocacy group, today called on Governor Bredesen to stop conducting the Tenncare negotiations with a news blackout. Tennessee Tax Revolt, Inc. claims that the news blackout is, at the very least, a violation of the spirit of Tennessee’s Sunshine law and also directly contradicts the Governor’s own commitment to open budget hearings. The negotiations directly affect almost one third of the entire state budget. Governor Bredesen has a constitutional responsibility to represent all citizens and to conduct public business in public.

“We understand the Governor may not be able to allow the public complete access to the actual negotiations but at very least the Governor should issue daily updates with hard numbers about the hard choices being made”, said Ben Cunningham, a spokesman for the group. “The taxpayers who are bearing this $8 billion burden deserve no less.”

Tenncare is a huge program that costs taxpayers, who are not Tenncare clients, approximately $3,000 for each tax return filed. (See calculations on page 2.) These same taxpayers must also provide healthcare for their own families.

“I am not sure that Governor Bredesen understands the frustration that many taxpayers feel about Tenncare. This program was not approved by the voters or the General Assembly when it was created and now Governor Bredesen is allowing a small group of lawyers to control the fate of a program that is costing the average non-Tenncare tax filer $3,000”, Cunningham said. “The taxpaying families of Tennessee are just as compassionate as people anywhere in the country but there is, very simply, a limit to their resources and their patience.”

Methodology: Determine 1-the total cost of Tenncare to Tennessee taxpayers and then 2- approximate the number of taxpayers who bear the tax burden and then 3- divide the cost by the number of taxpayers to find the average cost of Tenncare for taxpayers who file a federal tax return, (individual or joint return), have a tax liability, and are not Tenncare clients.

1- What does Tenncare cost Tennessee Taxpayers?

According to Governor Bredesen’s Tenncare Fact Sheet, linked here,
HTTP://www.sitemason.com/files/kBsbTO/111004%20TennCare%20Facts.pdf
The Total cost of Tenncare is $ 7,800,000,000.

$ 5,300,000,000 Federal Government share
$ 2,500,000,000 State Government share

However, according to this report from the Tax Foundation, linked here,
HTTP://www.taxfoundation.org/taxingspending.html

Tennessee receives $1.29 for each $1.00 of federal tax paid so the cost
to Tennessee Taxpayers for $5.3 billion received from Federal Government
is $ 4,108,000,000. 

So the total cost to Tennessee Taxpayers for TennCare is
$  4,108,000,000 – Federal Taxes
 2,500,000,000 – State Taxes

Total Tenncare annual cost 6,608,000,000.

2- How many Taxpayers have a net cost for Tenncare, i.e. how many taxpayers either:
   A: Do not receive Tenncare benefits or
   B: pay more in taxes than they receive in benefits 

There are 5.8 million people living in Tennessee. How many of these of these people receive enough income to have a tax liability?

The Economic Report to the Governor, linked here,
HTTP://cber.bus.utk.edu/erg/erg04app.pdf
shows non farm employment at 2,678,510.

This is corroborated by IRS data for 2002, linked here,
HTTP://www.irs.ustreas.gov/pub/irs-soi/02in43tn.xls
which shows 2,552,002 individual tax returns filed in Tennessee and
1,917,278 returns showed a tax liability.