Going broke getting well: Reforming Medicaid in IL won’t come cheaply

By Benjamin Yount | Illinois Watchdog

SPRINGFIELD, Ill. — Illinois wants to save money on Medicaid, but before that happens taxpayers will have to pull out their wallets. Several times, probably.

To get $5 billion from Washington, D.C., Illinois will have to spend nearly $500 million a year on new programs.

The price tag for Illinois’ massive Medicaid overhaul came, reluctantly, from Gov. Pat Quinn’s administration Tuesday.

“The new programs are in the neighborhood of $300 million to $400 million,” Doug Elwell, the managing principal of Health Management Associates a firm working with the state, told lawmakers.

But that’s just some of the first-year costs, and those costs are expected to rise.

“It looks like you’ve suddenly bumped the growth figure so you can grow the program, and still meet the budget neutrality requirement,” said state Sen. Dale Righter, R-Mattoon, noting the Quinn administration is planning for a 5 percent expansion of Illinois’ $13 billion-a-year Medicaid system.

Illinois’ Deputy Gov. Cristal Thomas said Illinois has trimmed its Medicaid program over the past few years, yet the Obama administration wants Illinois to grow Medicaid, he said.

“A lot of what we have in this (plan) is the direction that the federal government wants to see us go,” Thomas told Righter.

Illinois wants to overhaul its Medicaid system by changing how, and how much, it pays to take care of the sick, the poor and the old.

One of those major changes involves spending $60 million dollars a year to take Medicaid money, used for hospital stays or medication, and instead pay for homes for the homeless.

Illinois’ Medicaid reforms would mean Medicaid expansion. The state wants to add new telemedicine programs, create a new bureaucratic layer of region at health hubs and even try to spend health-care money on a food-safety program.

Lawmakers are skeptical.

“The General Assembly needs to be engaged in this process,” Righter said, adding that the Legislature needs to give the Medicaid question the due diligence of a new law.

Deputy Gov. Thomas told Righter she would advise the General Assembly, but she made it clear: The Quinn administration is working with the Obama administration. No one else is needed.

“The negotiations are between the state and the federal government,” Thomas said. “We’d be happy to keep members of the General Assembly informed to whatever extent (they) would like.”

Illinois is racing toward a March deadline to file its Medicaid overhaul — officially known as a 115 Waiver — with the federal government.

But Thomas said it will be January 2016, at the earliest, before Illinois can begin its Medicaid overhaul.

For now, Illinois lawmakers will try to manage a Medicaid system that will swell to nearly 3 million people and will cost nearly $14 billion in the next state budget.

Contact Benjamin Yount at Ben@IllinoisWatchdog.org and find him on Twitter @BenYount.

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