MEDICAID REFORMS WILL SAVE $1.6 BILLION
Several years after Senate Republican lawmakers began pushing for major reforms to the state’s healthcare program for the poor, the Governor signed a sweeping reform package into law June 14 that will reduce state Medicaid liabilities by $1.6 billion.
A bipartisan team of lawmakers worked with the Department of Healthcare and Family Services for months to negotiate the Medicaid reform package, which could put the program on the path to permanent solvency if properly implemented by the Quinn Administration.
Many of the Medicaid spending reforms bring Illinois’ program into line with practices followed in other states and by private insurance carriers.
Significant reductions were contained in Senate Bill 2840, which includes $1.36 billion in benefit cuts and $240 million in provider rate reductions. The measure also targets eligibility verification as a way to produce significant cost savings, including turning over the verification of continued eligibility (redetermination) to a private entity, which is expected to save the state $350 million.
One important Medicaid reform measure, signed into law May 18, targets the state’s use of “presumptive eligibility” in re-determining eligibility for Medicaid applicants. Senate Bill 770 will end the current practice of automatically assuming that an enrollee is eligible without proper verification.
Many of the spending reforms included in the package were first outlined in the Senate Republicans’ 2011 “Reality Check” fiscal reform proposal. They will help us protect the most vulnerable citizens while rooting out fraud and mismanagement.
CUTTING UP ‘MEDICAID CREDIT CARD’
Cutting up the Governor’s “Medicaid Credit Card” was another key reform long-sought by Senate Republican lawmakers.
Senate Bill 3397 would significantly reduce the ability of Governors to hand out Medicaid services in one fiscal year, and push the bills off into the next year.
Without this reform, the non-partisan Civic Federation estimated that Illinois’ Medicaid debt would reach $21 billion within five years.
CIGARETTE TAX REGRESSIVE
Included in the Medicaid package is a $360 million increase in state tobacco taxes, pushed by Democrat leaders to avoid having to cut more from Medicaid spending.
Senate Bill 2194 increases cigarette taxes by $1 per pack and doubled the tax on other tobacco products from 18% to 36%.
I voted against the cigarette tax because lawmakers should look to reductions and reforms instead of a regressive tobacco tax where low-income taxpayers contribute to a disproportionately larger share of the revenues.
Senate Bill 2194 also spells out requirements that not-for-profit hospitals must meet in order to qualify for property tax exemptions, as well as requirements for investor-owned hospitals to meet to receive an income tax credit.
HOSPITAL MEASURE CONTRADICTS REFORM
Another measure signed by the Governor June 14 requires hospitals to provide free care to low-income patients in order to qualify for property tax-exempt status as a not-for-profit institution. Most hospitals will be required to provide the services to persons at 200% or less of the federal poverty level ($46,100 for a family of four). Rural hospitals and hospitals with fewer than 25 beds will be required to provide the free care to patients at 125% or less of the federal poverty level ($28,813 for a family of four).
I opposed Senate Bill 3261 because of concerns that this new mandate directly contradicts the aims of Medicaid reform because it will encourage patients to utilize hospital emergency rooms instead of participating in a coordinated care system. The care is not “free,” but rather the costs will be shifted to working class families who will end up paying more for insurance coverage.
COOK COUNTY WAIVER WILL STRAIN SYSTEM
Another controversial measure allows Cook County to apply for a Medicaid waiver to receive additional federal Medicaid funds.
I opposed House Bill 5007 because it is wrong to add between 100,000 to 250,000 new Medicaid recipients at a time when the system is near collapse.
NEW LAW TARGETS GANGS
In other business, the Governor signed into law an important measure to help law enforcement officials prosecute street gang leaders.
Known as the “Mini” RICO (Racketeer Influenced and Corrupt Organizations) Act, House Bill 1907 strengthens penalties for a long list of offenses if they are committed in furtherance of a criminal enterprise.
The law will allow prosecutors to connect different crimes that have been committed by the gang as a way to pursue the whole organization including gang leaders, instead of pursuing gang crimes as though they were isolated incidents.
Under the law, gang members could face more than 30 years in prison for criminal conspiracy. The asset forfeiture provisions allow law enforcement officials to go after gang leaders by taking away their wealth and other assets, such as vehicles and real estate.
AROUND THE DISTRICT
On June 14, I enjoyed participating in the McLean County Chamber of Commerce State Legislative Update. About 140 people attended, and I talked with them about pension reform, the budget and the issues we might cover during veto session. I also asked Chamber members to continue to work in Springfield to advocate for issues they think are important.
On June 13, it was also my pleasure to attend the Lincoln Logan County Development Partnership luncheon.