For many Illinoisans, Medicaid means poor access to health care. Long waits for
appointments, rejection by doctors, and emergency room visits are commonplace
for Medicaid patients. Much of that failure can be blamed on a Medicaid
enrollment that has ballooned to 3.2 million Illinoisans, crowding out resources
for the very people Medicaid was intended to protect.
That’s a sorry outcome for a state that spends 25 percent of its general fund
budget on health care, largely Medicaid. Much of Illinois’ troubles stem from
the fact that the state is currently trapped in a federally mandated,
matched-funding program that offers health coverage to its poor, but does little
to ensure actual access to that care.
But politicians willing to seek much-needed change have the perfect opportunity
to enact meaningful reforms that would help Medicaid patients and taxpayers
alike, including health savings accounts and premium-assistance programs that
would give Medicaid enrollees access to the same kind of health coverage
available in the private sector.
In view of the Nov. 8 national election results, with Republicans gaining
control of the White House and keeping their majorities in Congress, major
changes to Obamacare, including Medicaid, may be on their way. Reforms could
eventually turn over control of Medicaid to each individual state.
That’s good news for Illinoisans dependent on Medicaid. Not only will it allow
the state to be more efficient and innovative in how it delivers care, but
Illinois’ Medicaid enrollees can finally get the access to health care they
Gov. Bruce Rauner and the General Assembly can champion reforms that give
current Medicaid enrollees access to the same insurance plans Illinoisans in the
private sector have. Through sliding-scale, premium-assistance programs based on
need, paired with health savings accounts, today’s nonelderly, nondisabled
Medicaid patients could access health coverage through insurers such as Blue
Cross Blue Shield.
Under these kind of changes, Illinois’ most vulnerable wouldn’t be treated like
Medicaid isn’t working for patients or taxpayers, but enrollment continues to
Today, Medicaid patients are often forced to use lower-quality doctors,
hospitals and specialists, if they can get access at all. According to a recent
report by physician placement and consulting firm Merritt Hawkins, 55 percent of
doctors in major metropolitan areas refuse to take new Medicaid patients.
Another study by the Department of Health and Human Services found 56 percent of
Medicaid primary care doctors and 43 percent of specialists weren’t available to
Moreover, health outcomes for Medicaid patients are unimpressive. A randomized
study by the Oregon Health Study Group revealed that health results of Medicaid
enrollees were not significantly better than those of people without access to
And while one-third of all U.S. children are enrolled in Medicaid, less than
half are ever tested for lead – even though the federal government mandates
screening for Medicaid patients.
Medicaid’s rapid boom in enrollment has contributed to those poor outcomes.
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In 2000, just 1.37 million, or 11 percent, of all Illinoisans
were enrolled in Medicaid.
As of 2015, enrollment had swelled to 3.22 million – a 135 percent
increase. With more than a quarter of all Illinoisans on Medicaid,
it is no longer a safety net for Illinois’ neediest.
As the number of Medicaid enrollees has increased, costs have,
too. Since 2000, total general revenue fund, or GRF, and GRF-like
Medicaid costs have jumped by $7 billion. That increase alone is
nearly what Illinois state government appropriates for K-12
education each year.
The recent addition of Obamacare enrollees, while currently funded
with federal dollars, will put additional strain on an already
overworked health care system. An additional 600,000 Illinoisans
have been added to the insured rolls, costing the state $1.8 billion
in 2015 alone.
A projected $5 billion budget deficit in Illinois means the time is
now for reforms
The potential for Medicaid reform is timely for Illinois.
Springfield is set to run an overall $5 billion deficit in its
general fund this year – crowding out core government services for
many of Illinois’ most vulnerable.
Instead of continuing to pour money into a failing system, Medicaid
needs comprehensive reform based on expected changes at the federal
level. Illinois Policy Institute proposed the following changes in
2013, and now the time is ripe to finally offer private insurance
options to Illinois’ neediest residents through:
Federal block grants: Reform should begin with swapping out the
current Medicaid financing system of federal matching funds for a
block grant. With a block grant, Illinois state government would
then have an incentive to reform and innovate how it delivers care
without fear of losing its federal funds.
Premium assistance for Illinoisans: With funding secured, Illinois
can then transform Medicaid’s fee-for-services and managed care
programs into a sliding-scale, premium-assistance program based on
need, allowing the state’s most vulnerable the opportunity to
purchase private health insurance.
Premium support funds for nonelderly and nondisabled patients would
be placed in a Medicaid savings account, or MSA, similar to a health
Medicaid savings accounts: With MSAs, individuals can select the
insurance that best fits their needs and preferences. Patients could
also use any remaining funds in their accounts for health care
expenses such as doctor visit co-pays, prescription drugs and
To make these reforms work, Illinois must also revisit eligibility
requirements to ensure the most vulnerable residents aren’t crowded
out of the safety net.
The 2016 election provides an opportunity for real Medicaid reform
and improved health care access to those who need it most.
Rauner and the Illinois General Assembly must be prepared to act.
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