May 30, 2012
Previously published on Spring 2012
Since 2007, the number of people enrolled in Medicaid in the state of Illinois has jumped to 2.7 million from 2.1 million. state lawmakers passed some Medicaid reforms last year, including requiring stricter proof of income and eligibility, but implementation of some of these changes has been delayed. Earlier this year, Illinois Governor Pat Quinn pressed for cuts to Medicaid spending in his annual budget speech. Illinois healthcare providers have strongly opposed Governor Quinn’s plan to cut $2.7 billion from the state’s Medicaid program. Governor Quinn has not yet identified where all of the proposed cuts would come from, but has indicated that the state could potentially close or consolidate dozens of facilities, which would include hospitals, mental health facilities and nursing homes.
According to one article published in Crain’s Chicago Business in February of this year, Governor Pat Quinn's plan to cut $2.7 billion from Medicaid to save a program "on the brink of collapse" could prove fatal for some of the Chicago-area hospitals that treat the poor and already are struggling to survive. The Illinois Hospital Association said Governor Quinn’s proposed cut to Medicaid spending would result in hospital layoffs and closures. A group of Illinois community hospitals, which included Mercy Hospital & Medical Center, Holy Cross Hospital and Norwegian American Hospital, proposed a reduction plan that would cut $1.4 billion from Medicaid. Governor Quinn administration officials said they will review the hospitals' and state's proposals, but hospital officials said the issue needs to be resolved quickly, as they cannot afford to cover unreimbursed care and cuts as large as the ones proposed by the state. Other county officials have questioned whether the state administration has fully considered the potential effect Medicaid and human services cuts might take on Stroger Hospital in Cook County.
Another proposed cost-saving measure is cutting payment rates for doctors, pharmacies and hospitals. Consideration is being given to setting more uniform standards of care, curtailing some services, such as weight-loss surgery and reducing how much the state pays for other services, including the increased payment to a doctor for performing a C-section rather than a regular birth. Governor Quinn has expressed a desire to examine the hospital assessment rate, which sets reimbursement fees for hospitals regardless of how many Medicaid patients they actually treat, and consolidating Medicaid waivers, which the state uses to pay for various health care needs, including seniors who are in need of home care and children who require the use of ventilators. According to a recent health care analysis funded by the Alliance for Quality Nursing Home Care (AQNHC), the proposed Medicaid cuts could hurt Illinois skilled nursing facilities. According to the AQNHC, Medicare and Medicaid pays for the care of approximately three out of four nursing home residents in the state of Illinois and how the cuts will affect the ability of nursing homes to provide quality health care will need to be examined.
Governor Quinn has stated the hope that the payments accrued over the years and owed to Medicare can be dealt with through other changes put in place last year. One change involves moving Medicaid patients into a managed care system that focuses on prevention to catch health care problems earlier and stop more expensive care. The goal would be to have half of Medicaid patients enrolled in managed care by 2015. The potential effect of these proposed Medicaid cuts is an unknown. What institutions may close, how this will affect physicians and health care personnel, where patients of hospitals or residents of nursing homes will be transferred if institutions are closed or cuts are made to programs is all unknown at this point and will likely not be fully understood until the cuts are implemented.
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