In August of 2020, Aaliyah Evett was working at the Watts Bar power plant in Spring City, Tenn., when her mom called and said the police in South Pittsburg were searching for her. Evett called the officer, who was an old friend from high school.
“She said whatever you do, just get home and turn yourself in right now,” Evett said. “If you wait and turn yourself in, they can hold you for the weekend. If you get pulled over wherever you are, they’d have to hold you wherever you are and wait for Marion County to come get you. So I was like, let me just drive. Not too slow, but just slow enough.”
Evett panicked. She’d never been in trouble with law, never had anything more serious than a speeding ticket. A felony would disqualify her from work in highly regulated nuclear plants.
Evett called the shop steward to let him know what was happening.
“They ended up terminating my access,” Evett. “I couldn’t get access until my case was over.”
Evett would become one of the mothers on the nightly news, accused of felony fraud, not realizing the bureaucratic trap she’d fallen into as Tennessee zealously tries to keep low-income Alabamians from using its medical services.
To fall into this trap, you need to be a parent who earns less than $20,000 a year. And you need to switch addresses, moving from Tennessee to Alabama, often a matter of a few streets in border towns. And then you need to take yourself or your child to see a doctor.
In 2020, Evett became the eighth person in a little more than a year arrested from the tiny town of Bridgeport, Ala., for allegedly using Tennessee Medicaid to get medical care for her children.
Evett cried for the entire trip back to South Pittsburg. Before she walked into the police station, she calmed herself and redid her makeup.
“My sister, when I was about to pull up to the jail, she was like, ‘You better wipe your face.’” Evett said. “‘You better glue your eyelashes back on. You better just go in there. You better not let them see you cry. You better just go in there and take that mug shot.’”
A border and a stark divide
Evett spent eight years trying to hold her family together across state lines.
Evett was born and raised in South Pittsburg, Tenn., a town of about 3,000 best known for its cast iron pans and annual cornbread festival. When she was 14, she met her husband, who lived just across the state line in Bridgeport, Ala., a historic town of about the same size anchored by a Spanish colonial train depot.
The couple had their first child when Evett was just 16 years old, got married and had another. But Evett still spent most of her time at her mother’s house in Tennessee.
When she wanted a home of her own, she couldn’t find one in South Pittsburg. So Evett settled for the closest town over: Bridgeport.
With that move, Evett broke the law, Tennessee officials later claimed. A stone monument on the road between South Pittsburg and Bridgeport marks the border. On one side, Tennessee provides access to health care for thousands of low-income parents. On the other side, using those benefits to go to the doctor can send you to jail.
Medicaid provides medical care to needy citizens and is mostly funded by the federal government but run by the states. All but 12 states – including Alabama and Tennessee – have expanded Medicaid to cover all individuals earning less than $17,609 or $22,000 for a family of three.
But in the dozen holdout states, the rules vary. That creates a stark divide along the Tennessee-Alabama line. Most low-income parents in Alabama have no access to Medicaid while those working minimum-wage jobs in Tennessee get a system once renowned for its generous coverage.
“The real scandal is the Alabama eligibility limits,” said Michele Gilman, a law professor at the University of Baltimore and expert on poverty. “And then Tennessee imposes harsh penalties on people desperately seeking health care.”
Tennessee leaders, recognizing the incentive to cheat, adopted aggressive policies to punish those who abuse TennCare benefits, complete with a dedicated law enforcement unit and rewards for tipsters. State law makes Medicaid fraud a felony on par with identity theft or burglary. Offenders can face up to 12 years in prison or more, depending on the size of their medical bills.
A special enforcement unit, the Office of the Inspector General, can investigate anyone accused of improperly using TennCare and police have arrested thousands of people, including dozens in Alabama, Mississippi and Georgia.
The arrest dragged Evett’s name through the mud, cost her a job and left her afraid to take her children to the doctor. She’s not the only one.
Another north Alabama resident said an eviction pushed her daughter over the state line, facing felony charges and unable to afford an attorney. And one mom’s decision to apply for TennCare during her daughter’s medical emergency resulted in six months of incarceration.
“This says a lot more about our health care system than it does the character of the people prosecuted,” Gilman said.
Hot spot for fraud charges
South Pittsburg and Bridgeport both sit about five miles apart at the bottom of the Sequatchie Valley. The two towns are so close the Pirates of South Pittsburg High School play the Chiefs of North Jackson in Alabama every year during basketball season. The walls of the Cumberland Plateau and Sand Mountain rise up on either side like privacy curtains, enclosing a valley floor dotted with picturesque towns and factory buildings.
The area has long been a hotspot for TennCare fraud cases. Many have involved Alabama residents fraudulently receiving TennCare. Others focused on doctor shopping and the sale of prescription drugs by TennCare recipients. The summer Evett moved in, authorities arrested seven Bridgeport residents from a single apartment complex.
Evett said she never applied for TennCare, but an earlier application for food stamps may have triggered an eligibility check. When she moved to Alabama in 2019, her husband worked at Lodge in South Pittsburg, at the foundry producing cast iron cook ware. Health insurance came with the job.
“He would come stay at my house in South Pittsburg,” Evett said. “And he got a place in Alabama, so I would just go back and forth because of course, we tried to raise our child together. But I always stayed up there in Tennessee.”
In April 2019, the couple separated. Evett worked at a temp agency and took care of her two children. That summer, her older son overheated at a youth football game and was taken by ambulance to the hospital. Her younger son had ongoing medical issues from a hernia diagnosed at birth.
Private insurance paid most of the expenses, but Evett used her own money for the deductibles and co-payments. Evett lived in Bridgeport for a few months, then moved back into her mother’s house in South Pittsburg.
In March of 2020, a man came to her home. He introduced himself as an investigator in the Tennessee Office of the Inspector General and told Evett she’d been reported for TennCare fraud.
The coverage gap
In most states, all low-income adults and families can receive Medicaid coverage. But in Alabama and Tennessee, low-income adults without children don’t qualify.
Alabama Medicaid barely covers parents, limiting benefits to those who earn less than $4,000 a year. That means a parent scraping by with a full-time job at the federal minimum wage makes almost four times too much to get help.
There is a national program to get help with insurance costs, but for that to kick in, people must earn about $30,000 or more for a family of three.
This is the gap many fall into Bridgeport: too wealthy for state Medicaid, too poor for federal coverage.
But making things more complicated, the cutoff is different in Tennessee than in Alabama. In Tennessee, parents earning up to about $20,000 qualify for TennCare, the state’s managed Medicaid program. That would cover someone working full-time at minimum wage.
Some people pick up felonies because they didn’t realize their TennCare coverage stops at the state line, said Michele Johnson, executive director of the Tennessee Justice Center.
“A lot of people don’t understand that Medicaid can be completely different in another state,” said Johnson. “That isn’t really obvious to most people.”
Evett and her kids had moved back in with her mom in October 2019 and she got on with the Laborer’s Union. The work took her to nuclear plants across the Tennessee Valley
“If you’re going into something, I have to write down, all that you’re taking into this contamination zone to make sure you bring it back out, so it’s not left in there,” Evett said.
In March of last year, she met the Tennessee investigator at her mother’s house in South Pittsburg. He immediately seemed suspicious when she drove up from the same direction as Bridgeport. She tried to explain that she came from a cousin’s house that sits right on the Tennessee side of the border.
“The way we live it’s a road that’s leading from Alabama, because we’re like a minute from the state line,” Evett said.
Evett invited him in to see her children’s things as proof she lived at the house. It was at the beginning of the pandemic, and the investigator told Evett the office might postpone the case. He promised to call her if anything happened, she said.
In August of 2020, the police came looking for her and she turned herself in.
Safety net or tangled web?
About 10 percent of Alabama residents don’t have health insurance, but in the area around Bridgeport it’s higher than 13 percent. Some avoid medical care. Others use free clinics and emergency rooms instead, often incurring crippling medical debt.
“Many adults in most non-expansion states have few options for affordable coverage relative to enrollees in states that have adopted the expansion,” said Robin Rudowitz, co-director for the Program on Medicaid and the Uninsured at the Kaiser Family Foundation.
Some parents unable to get health insurance in Alabama pretend to live in Tennessee for the Medicaid, according to several Bridgeport residents. Others have faced the loss of benefits, and even felony charges, after personal situations forced them across state lines.
Tennessee Inspector General Kim Harmon said her office doesn’t pursue criminal cases against people who made mistakes. But those who knowingly use TennCare while living in another state are breaking Tennessee law and creating burdens on taxpayers who shoulder the costs.
“TennCare provides the benefits, and we provide the service of making sure no one takes advantage of those benefits,” Harmon said. “Anytime you have a good program, people are going to lie to try to get the benefits.”
Tennessee and Missouri both have eight bordering states, more than any other in the country. The Memphis metropolitan area spills over into Arkansas and Mississippi.
“Because Medicaid varies from state to state, the person is required to get Medicaid in the state of their residency,” Harmon said. “So it is very common for us to have cases where people may have been in Tennessee when they applied, but they want Tennessee’s benefits for whatever reason. What we often see is that they move out of state and they just not notify TennCare that they’ve moved, but they also continue to use their TennCare benefits.”
Jailed over cancer treatment
Christy Dagnan, 44, grew up in the tri-state area anchored by Chattanooga. She lived in Tennessee, Georgia and Alabama. In 2014, she and her 15-year-old daughter lived in Flat Rock, a small community on top of Sand Mountain in Alabama.
One day the teen complained that her stomach hurt, and the pain wouldn’t go away. Neither Dagnan nor her daughter had insurance. She took her daughter to the hospital in Jasper, Tenn., where doctors discovered a mass in the girl’s abdomen.
“They told me it was as big as a newborn baby’s head,” Dagnan said.
She was rushed to a larger hospital in Chattanooga, where a social worker encouraged Dagnan to apply for TennCare. If the girl needed radiation and chemotherapy, the bills could quickly reach tens of thousands of dollars. Dagnan signed up and made a plan to move to Tennessee
“I did what I thought I needed to for my daughter’s health, and I would do it again,” Dagnan said.
Doctors removed the mass, which turned out to be benign. Dagnan and her daughter later moved to nearby Guild, Tenn.
A few years later, investigators caught up to her. In addition to living in Alabama, they said Dagnan had property she owned jointly with an ex-husband that disqualified her for coverage.
The teen’s surgery cost more than $35,000, an amount that boosted the criminal penalties. She received a public defender and pleaded guilty to a felony with a minimum of three years in prison. Dagnan’s lawyer asked the judge for mercy, so he knocked her sentence down to six months in the local jail.
Dagnan’s daughter was a senior in high school when she went to jail. She cobbled together enough money to pay the rent and left the teen on her own while she did her time. She said other inmates mocked her because Dagnan had never been to jail before and had been convicted of a white-collar crime.
“It was a really difficult time,” Dagnan said.
Dagnan, who worked in medical offices prior to her arrest, can no longer be employed in any physician or doctor’s office in the TennCare network.
She is also uninsured and sick. Multiple bouts of pneumonia have sent Dagnan to the hospital. In addition to $35,000 in restitution to TennCare, she now has more than $60,000 in unpaid hospital bills. Breathing problems have left her unable to work, but she can’t qualify for disability because she lacks access to pulmonary specialists who could give her a diagnosis.
“There was a lot I lost because I wanted to have good care for my sick child,” Dagnan said.
$150 cash rewards
Former Tennessee Gov. Phil Bredesen took office in 2003 at a time of crisis for TennCare. His predecessors had expanded the program beyond its federally mandated role to cover children, pregnant women, seniors and the disabled so that some unemployed and uninsurable residents could get access to health coverage.
Tennessee became a leader in the 1990s covering the uninsured by allowing its middle class and upper income residents to participate in Medicaid if they couldn’t get private insurance due to preexisting medical conditions. But the policy triggered a backlash, and complaints poured in about Medicaid recipients with nice cars and big houses, said Lola Potter, a spokeswoman for the Office of the Inspector General who worked for TennCare at the time.
Within a decade, TennCare had grown so large and so expensive it threatened to state’s ability to fund education, prisons and law enforcement. A report from McKinsey, a consulting group, called the program unsustainable.
“In the end, we can’t allow TennCare to bankrupt the state,” Bredesen told The Tennessean in 2005.
Potter said reports of fraud flooded TennCare offices.
“There were all kinds of stories,” Potter said “You can dig them up about people living in like Russia who were on TennCare. And at that time, there were no limits. There were no prescription limits. There were no limits whatsoever.”
By 2005, the program had become the subject of a budgetary tug-of-war. In the end, a hard-fought compromise kicked 170,000 off the rolls.
To safeguard TennCare for the future, Bredesen proposed a number of measures to crack down on fraud, despite findings by McKinsey that it contributed little to the program’s spiraling expenses.
The state created the Office of the Inspector General, the first unit of its kind in the United States. It’s an independent law enforcement bureau with the power to investigate anyone accused of improperly using TennCare benefits.
Lawmakers authorized $150 cash rewards for tips and began aggressively prosecuting cases. More than 2,000 recipients have been convicted of TennCare fraud since 2005, and they have been ordered to pay back a total of $5.8 million. That averages out to less than $3,000 per defendant.
Cases have also been brought for much less. One Alabama man in Bridgeport who pleaded guilty to felony TennCare fraud paid just $1.57 in restitution, the cost of a single prescription. The court set his bond at $6,500.
Big fish and leaky buckets
The federal government funds Medicaid Fraud Control Units in every state that investigate wrongdoing by doctors, hospitals, pharmacies and other health care providers – the big fish of Medicaid fraud.
Settlements in those cases often reach seven figures, including one $3.2 million case against a Memphis dialysis company. Because providers have the ability to steal large amounts from Medicaid programs, many states focus resources on those investigations.
Tennessee Inspector General Harmon said her office may not have huge settlements, but it deters those trying to cheat.
“I kind of call us, we kind of look for the leaky bucket,” Harmon said. “It’s not that any one case is a large dollar amount. We’re not looking at millions of dollars like the Medicaid Fraud Control Units.”
Graham Swafford, an attorney in Jasper, Tenn., said he has handled a couple cases of TennCare recipient fraud, including Evett’s. And he’s also filed bankruptcy for people buried by medical debt. The longtime Republican has begun to rethink his position on universal health care.
“If you’ve got to lie to get it, you probably need it pretty bad,” he said.
A bad case
Two weeks after Evett’s arrest, she got a call from a friend in Chattanooga. Her mugshot and case made the local news. According to the anchor, Evett had used $4,600 in TennCare benefits, faced two felony charges and a possible maximum sentence of 24 years in prison.
Her mugshot seemed to appear everywhere – local TV news, in the paper and rocketing around Facebook. Even a coworker from Mississippi asked about her legal problems. Some commenters made cruel jokes about her appearance, but that didn’t bother her as much as another detail from the coverage.
“They kept saying I’m a north Alabama woman,” Evett said. “And I’m like, no I’m not. I’m not from Alabama, but we’re so close to the state line. But I’m not from Alabama, I’m from Tennessee.”
The agency circulates press releases every time an arrest is made and creates Most Wanted posters for suspects on the run. Harmon said the goal is to help catch criminals. Most of those on the Most Wanted list have active arrest warrants and many have committed other crimes.
“The negative light it shines is minimal compared to being able to put that information out there and say you shouldn’t do this,” Harmon said “You shouldn’t cheat. You really should try to do it the right way.”
Harmon said most TennCare cases focused on pain pill diversion up until a few years ago, when federal guidelines slowed the flow of prescription opioids. Now more cases involve people who lie about eligibility, including those living out-of-state.
Tennessee doesn’t break down its convictions by gender or race, according to a spokesperson. In a report from 2008, officials said the majority of arrests involved women, 2,099 compared to 898 men. Out of the eight Bridgeport residents arrested for TennCare fraud in 2019 and 2020, seven were mothers.
Most of the cases from Bridgeport emerged after an investigator made an interesting discovery.
He noticed several Tennessee license plates in the parking lot of an apartment complex, Harmon said. He ran them and found seven people on TennCare. Harmon said her investigators now regularly look for Tennessee plates in border towns, a practice that has increased the number of out-of-state fraud cases.
A common bond
Evett has some friends who had been convicted of TennCare fraud, so she knew what to expect if the court found her guilty. “You are on four years state papers and you’re a felon for the rest of your life,” Evett said.
At her first hearing, she sat in court with other defendants facing felonies thinking about the nature of her charges.
“You’re going to put me in jail for 20 years because I was getting insurance to take my kids to the doctor?” Evett said. “I was like, how am I going to explain this to a 9-year-old?”
The Laborer’s Union offers health insurance to most members, but after Evett’s arrest, she couldn’t work in nuclear plants. She was unemployed for more than two months.
“I finally ended up getting a job at our local hotel in Kimball in October,” Evett said.
Her income took a hit. The union paid $20 an hour plus overtime. The hotel paid just $10 an hour and capped her hours at 30 per week. Instead of getting union benefits, her children qualified for TennCare. Right after she started work at the hotel, her youngest got COVID-19, forcing the family into quarantine and her onto unpaid leave.
At a hearing before her son’s diagnosis, Evett had a question for the judge. The 2-year-old had been sick and Evett was afraid.
“So I still have TennCare right now?” Evett asked the judge. “Should I take him to the doctor? And he was like, ‘Yeah, why not? You have it.’ Because we’re going to court right now for insurance fraud. I’m terrified to use this insurance that we have right now.”
“So we went to the health department where they tested him for free,” Evett said.
The staff at the health department urged her to follow up with her son’s doctor but she never did for fear of the legal fallout. The family rode out his illness at home.
The pay from Evett’s union job had enabled her to hire a private attorney. Between bond and his fees, she emptied her savings. It paid off. Most people she knew facing similar cases had been assigned to public defenders and pleaded guilty. In December, Evett was cleaning a hotel room. Her lawyer called to tell her the charges had been dropped.
“I was working in a room and I was just sitting there crying,” Evett said. “But still I didn’t quite believe it. I asked my lawyer to send me the papers. And all it said was ‘not processed.’ But that was enough for me.”
With the case behind her, Evett rejoined the Laborer’s Union, where she can qualify for health insurance. She is living with her mother in South Pittsburg, where she knows other mothers in the area who have been convicted of TennCare fraud and is still struggling to make sense of it.
“Like your mom’s a felon because she’s trying have insurance for you to take care of you when you get sick and have to go to the doctor,” Evett said. “That’s absolutely absurd. That makes no sense.”