Illinois Governor Pat Quinn is calling for a restructuring of Medicaid in Illinois and proposed cuts during the state's 2013 fiscal year totaling $2.7 billion. The budget address responded to a report by the Civic Federation of Chicago, which estimated that Illinois will accumulate $4.7 billion in unpaid Medicaid bills by the end of FY 2013.
Possible Cuts
While this is only the beginning of budget negotiations, the proposed cuts will have significant consequences for health care providers. Governor Quinn did not offer specific plans in the budget address, but announced an intention to work with the General Assembly in adopting a restructuring plan. Shortly after the Governor's budget address, the Illinois Department of Healthcare and Family Services (HFS) outlined the following potential areas to reduce expenditures:
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Rate Cuts — Provider rates may be reduced by between 6 and 9 percent
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Managed Care — Participation in managed care plans may be increased and development of coordinated care programs may be accelerated and expanded
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Eligibility — Medicaid eligibility will be more closely scrutinized and monitored and standards could be reduced (from 185 to 133 percent of the federal poverty level)
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Cost Sharing — Copayments may be required or increased for certain services
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Service Coverage — Coverage of federal "optional services" could be eliminated or other cost-saving measures, including restricted admissions and utilization controls, may be imposed, including:
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Eliminate coverage or impose a moratorium on new admissions for supportive living facilities, intermediate care facilities and institutions for mental disease
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More rigorous screening of need for facility services
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Restructure home and community-based waiver programs
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Eliminate coverage or impose utilization controls for:
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Hospice
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Pediatric palliative care
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Group psychotherapy for nursing home residents and transportation services to group psychotherapy
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Adult chiropractic, dental and podiatric services, adult therapies (occupational, physical, speech), adult pharmaceuticals and eyeglasses
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Transplantation services
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Rehabilitative services
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Ambulatory surgical treatment centers
In addition to Medicaid proposals, the Governor proposed to "rebalance" institutional and community care including closing four state-operated facilities for the mentally ill and developmentally disabled.
What Providers Can Do Now
The following steps can be taken immediately:
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Contact and work with your local legislators and provider associations
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Closely monitor the FY 2013 budget as it is developed during the next three months
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Develop strategies for participation in Medicaid managed care plans
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Anticipate even slower payment cycles from the State
For More Information
For additional information on the FY 2013 Budget Address, and for a live stream or full text of Governor Quinn’s February 22, 2012 budget address, visit: http://www.illinois.gov/PressReleases/ ShowPressRelease.cfm?SubjectID=2&RecNum=10036. If you have questions about the Medicaid budget proposals, please contact:
