$14 billion state-federal program offers health insurance mostly
for low-income children, pregnant women, parents with young
children, senior citizens and the disabled. Chief among the reforms
passed in January was a requirement to move 50 percent of the
state's 2.8 million Medicaid participants to a "medical home" within
the next four years through "coordinated" or managed care, and to
move residents from nursing homes and other institutional care into
Illinois Senate Republicans believe the
state can do better than the $800 million in savings expected from
the reforms during the next five years.
"That was a good step one," said state Sen. Pam Althoff, R-
Crystal Lake, who served on the Medicaid reform task force. "But
there's now a step two."
Julie Hamos, director of the Illinois Department of Healthcare
and Family Services, noted that the reforms are intended to keep
people healthy and thereby hold down costs.
"If Medicaid (health care) services were not in place, sick
people without health insurance would have to resort to more
expensive hospital and institutional care," Hamos said in an emailed
This comes as Gov. Pat Quinn wants to borrow $2 billion to help
pay off a backlog of bills totaling $9 billion to $10 billion. Half
of the borrowing would be used to pay off Medicaid bills and garner
an enhanced federal match set to end in June with the expiration of
federal stimulus funding. Borrowing measures require a three-fifths
majority vote in the Legislature, meaning Republicans would have to
be on board.
Republicans have put their foot down on borrowing -- at least
until they see more savings. They're not alone.
States nationwide are preparing for up to 16 million new Medicaid
participants when the bulk of the requirements of the new federal
health care law go into effect in 2014.
Illinois is expecting 500,000 to 800,000 new participants, mainly
low-income childless adults able to participate for the first time.
That would add the equivalent of $2.6 billion to $4.2 billion a year
in costs to taxpayers, using fiscal 2010 data from the Department of
Healthcare and Family Services.
According to HFS data, the average
annual cost for a Medicaid participant in fiscal 2010 stood at
$5,264. Average annual costs among the key five groups:
Children up to 18:
disabilities, ages 19 to 64: $22,790
Other adults, ages 19
to 64: $4,584
Senior citizens, 65
and older: $16,623
Partial benefits for all ages: $1,287
The federal government is expected to pick up most of the tab for
new participants until 2020, when its share drops to 90 percent, but
states are nonetheless downsizing their Medicaid services where they
can to save money now and in the future.
"States are looking at everything they can," said Melissa Allen,
a health policy specialist with the National Conference of State
Mandatory services -- those that states must offer in order to
participate in the Medicaid program and receive federal matching
grants based on per capita income -- are generally off-limits.
These include doctor visits; hospital stays and outpatient
services; early and periodic screening, diagnostic tests and
treatments; laboratory and X-ray services; home health services; and
nursing home care, according to the federal Health and Human
But limiting or eliminating optional services that states can
choose to offer was common in 2010, and will likely continue, said
"States in 2011 are looking into going deeper into these areas,"
These areas include optometry services and eyeglasses, dental
services and dentures, prosthetics, physical and occupational
therapy, podiatry services, chiropractic services, private-duty
nursing services, prescription drugs, and speech, language and
hearing disorder services. States also receive matching funds for
All states offer prescription drugs, but many implement a
preferred drug list and copayments, as Illinois does.
[to top of second column]
Additionally, Illinois offers supportive living facilities (a
step below nursing home care), inpatient hospital psychiatric
services, home care, medical equipment and mental health
rehabilitation services, according to HFS.
"Illinois offers a laundry list of optional services," said state
Sen. Dale Righter, R-Mattoon, who co-chaired the Medicaid reform
HFS does not plan on any more changes beyond what is outlined in
the reform legislation or fiscal 2012 budget proposal, which calls
for a 6 percent Medicaid rate cut to nursing homes and hospitals and
the elimination of a $107 million, non-Medicaid prescription drug
program for seniors, Claffey said.
Hamos said eliminating optional Medicaid services is
"The most expensive optional services are pharmaceuticals,
supportive living facilities, home care, dental services and medical
supplies -- total elimination could save $672.8 million -- but would
undoubtedly result in thousands becoming sicker and requiring more
expensive institutionalization or hospital care," Hamos said in an
According to the Kaiser Family Foundation, states in 2010 and
2011 aggressively cut back on optional services. Twenty states
implemented benefit restrictions in fiscal 2010, and 14 states
planned similar actions in fiscal 2011, including limiting or
cutting adult dental services, imaging services, medical supplies or
equipment, therapies or personal care services.
Kaiser is a nonprofit, private operating foundation focusing on
the major health care issues facing the United States, according to
Illinois also uses its Medicaid Family Care program to cover
parents with children with incomes up to 185 percent of the federal
poverty level, or $41,348 for a family of four -- a higher income
level than most states, according to Kaiser. Participants pay
copayments, and in some cases, monthly premiums ranging from $15 to
Republicans say the state needs to lower income eligibility
"It's going to call for tough decisions," said Righter.
"Otherwise, we're going down a road that cannot be sustained."
But the federal health care law requires that states maintain
Medicaid eligibility standards that are equal to or more inclusive
than what were in effect when the Affordable Care Act became law,
March 23, 2010 -- called "maintenance of effort." States must seek
waivers to change eligibility standards.
Some states are already pushing for waivers.
Arizona GOP Gov. Jan Brewer made headlines recently when she
proposed eliminating certain organ transplants from the state's
optional Medicaid services and is now asking to drop eligibility for
Kansas Republican Gov. Sam Brownback this month wrote the federal
government for an overall exemption from the "maintenance of effort"
requirement and asked that the state receive its federal match in a
lump sum to do with it as it chooses.
Illinois Republicans claim the state is not doing enough to
"The common rhetoric is, 'We have to do more,'" said Righter.
Hamos said the reforms already in place strike the right balance,
but patience is needed.
"These changes will not reap huge savings overnight," she said in
Statehouse News; By MARY MASSINGALE]