April 29, 2012 * The Southern
Our view: A proposal to cut Medicaid rates for hospitals would hurt health
care and the well-being of patients statewide.
Gov. Pat Quinn walked into a financial quagmire when he succeeded Rod Blagojevich as governor and the murky mess only deepened after he won the 2010 gubernatorial election.
Illinois became a deadbeat, nearly bankrupt state by spending beyond its means for years — since fiscally responsible Gov. Jim Edgar left the governor’s mansion in 1999. The problems were made worse through neglect and band-aid solutions that provided enough breathing room for another year of neglect, a practice known as “kicking the can” down the road.
Quinn deserves credit for deciding we are at the end of the road. It takes political courage to cut spending and a tough skin to withstand the blowback from voters accustomed to leaders who gave the people what they wanted — sometimes before the people knew they wanted it and usually without a plan to pay the resulting bills.
Quinn is walking through an especially nasty minefield in a critical attempt to stabilize the state’s Medicaid system. It is a necessary trek, however, because the Medicaid debt is expanding at a rate certain to sink the entire system.
This is not a contrived crisis and Quinn is not resorting to scare tactics to create a stampede for a quick-fix solution. A report by the respected and nonpartisan Civic Federation projects spending on Medicaid this fiscal year will be about $8.6 billion and will grow by 41 percent during the next five years, ultimately hitting $12.1 billion.
The Civic Federation, which focuses on financial issues, reports the current pile of unpaid Medicaid bills totals $2 billion and could hit $21 billion by 2017.
Quinn must act and his plan to pare $2.7 billion in Medicaid expenses is a big step in the right direction. The plan strives to save $1.35 billion through cuts, reductions and efficiencies, including efforts to verify eligibility, prevent fraud, eliminate or reduce optional services and patient populations, prevent over-use or waste, adjust rates to reflect modern realities and implement all reforms included in the Medicaid reform law of 2011.
Those are excellent strategies, for the most part. We also salute the idea of raising $337.5 million in new revenue through a $1-per-pack tax hike on cigarette sales. The tax hike would enable the state to collect another $337.5 million in federal matching funds. It is sound public policy to seek funding for the well-known health problems associated with smoking from those who choose to smoke.
The trouble with Quinn’s Medicaid overhaul is in another area: $350 million in Medicaid rate cuts for hospitals. Hospitals in our state already are struggling to meet the costs of Medicaid care, especially because of the alarming growth in the number of state residents who qualify for Medicaid. That’s the real problem.
Rex Budde, the president and CEO of Southern Illinois Healthcare, recently wrote about the Medicaid crisis confronting hospitals, even without the difficulties associated with the rate cuts proposed by Quinn, in a “Guest View” commentary printed in this newspaper April 10.
“Illinois has one of the lowest Medicaid costs per patient in the country, spending only $5,773 per beneficiary — putting us in 44th place and well below the national average of $6,826.
“Enrollment growth, not hospital rates, is the reason for increased Medicaid spending. The number of Illinois residents on Medicaid has almost doubled in the past 10 years, due in part to the economic recession,” Budde said.
Southern Illinois Healthcare already is owed millions in late Medicaid payments from the state. Budde recently said the total was at least $26 million.
Imagine what will happen if hospitals are expected to cope with reduced Medicaid rates on top of the existing hardship. The Illinois Hospital Association isn’t blowing smoke when it warns the cuts could force some hospitals to close, eliminate services, trim jobs and create “health care deserts” in several portions of the state — including Southern Illinois. Medical care isn’t easily attained now, short of emergencies.
Instead of asking providers to accept reduced payments for care they are required to provide, every step must be taken to ensure Medicaid benefits are provided only to those patients who truly are in need. A doubling of the eligibility list in 10 years is tough to accept as legitimate. The state’s population isn’t dramatically growing and the recession, though lengthy and harsh, was less responsible for the growth than a state government unaccustomed to saying “enough!”
Illinois has 2.7 million Medicaid recipients and a total of 12.86 million residents. Children make up more than 60 percent of those eligible for Medicaid. Adults with disabilities, who comprise about 10 percent of the total, account for more than 35 percent of costs. It won’t be popular, but closer scrutiny must be devoted to Medicaid for children.
It won’t be possible to close the gap on the growing Medicaid debt entirely by trimming eligibility and eliminating fraud, but the actual reduction might be higher than Quinn’s proposal estimated. Our lawmakers need to look at other solutions for closing the gap instead of cutting rates for providers. Alcohol abuse is linked to many health problems; how much revenue might be generated by boosting the taxes on beer, wine and spirits?
Instead of putting state hospitals on the defensive, our legislative leaders should be working with the Illinois Hospital Association to develop realistic alternatives to excessive Medicaid rate cuts. With the state’s next fiscal year set to begin July 1, there is adequate but not plentiful time to thoroughly review all aspects of Quinn’s Medicaid proposal.
Bipartisan teamwork and statesmanship are especially in need. Quinn’s administration has simplified the Medicaid reform task by offering up plans to drive revenue and achieve real savings. What’s needed now is a comprehensive and deep review of all alternatives to an excessive Medicaid rate reduction that only will harm health care.
To read full article on The Southern
Gov. Pat Quinn walked into a financial quagmire when he succeeded Rod Blagojevich as governor and the murky mess only deepened after he won the 2010 gubernatorial election.
Illinois became a deadbeat, nearly bankrupt state by spending beyond its means for years — since fiscally responsible Gov. Jim Edgar left the governor’s mansion in 1999. The problems were made worse through neglect and band-aid solutions that provided enough breathing room for another year of neglect, a practice known as “kicking the can” down the road.
Quinn deserves credit for deciding we are at the end of the road. It takes political courage to cut spending and a tough skin to withstand the blowback from voters accustomed to leaders who gave the people what they wanted — sometimes before the people knew they wanted it and usually without a plan to pay the resulting bills.
Quinn is walking through an especially nasty minefield in a critical attempt to stabilize the state’s Medicaid system. It is a necessary trek, however, because the Medicaid debt is expanding at a rate certain to sink the entire system.
This is not a contrived crisis and Quinn is not resorting to scare tactics to create a stampede for a quick-fix solution. A report by the respected and nonpartisan Civic Federation projects spending on Medicaid this fiscal year will be about $8.6 billion and will grow by 41 percent during the next five years, ultimately hitting $12.1 billion.
The Civic Federation, which focuses on financial issues, reports the current pile of unpaid Medicaid bills totals $2 billion and could hit $21 billion by 2017.
Quinn must act and his plan to pare $2.7 billion in Medicaid expenses is a big step in the right direction. The plan strives to save $1.35 billion through cuts, reductions and efficiencies, including efforts to verify eligibility, prevent fraud, eliminate or reduce optional services and patient populations, prevent over-use or waste, adjust rates to reflect modern realities and implement all reforms included in the Medicaid reform law of 2011.
Those are excellent strategies, for the most part. We also salute the idea of raising $337.5 million in new revenue through a $1-per-pack tax hike on cigarette sales. The tax hike would enable the state to collect another $337.5 million in federal matching funds. It is sound public policy to seek funding for the well-known health problems associated with smoking from those who choose to smoke.
The trouble with Quinn’s Medicaid overhaul is in another area: $350 million in Medicaid rate cuts for hospitals. Hospitals in our state already are struggling to meet the costs of Medicaid care, especially because of the alarming growth in the number of state residents who qualify for Medicaid. That’s the real problem.
Rex Budde, the president and CEO of Southern Illinois Healthcare, recently wrote about the Medicaid crisis confronting hospitals, even without the difficulties associated with the rate cuts proposed by Quinn, in a “Guest View” commentary printed in this newspaper April 10.
“Illinois has one of the lowest Medicaid costs per patient in the country, spending only $5,773 per beneficiary — putting us in 44th place and well below the national average of $6,826.
“Enrollment growth, not hospital rates, is the reason for increased Medicaid spending. The number of Illinois residents on Medicaid has almost doubled in the past 10 years, due in part to the economic recession,” Budde said.
Southern Illinois Healthcare already is owed millions in late Medicaid payments from the state. Budde recently said the total was at least $26 million.
Imagine what will happen if hospitals are expected to cope with reduced Medicaid rates on top of the existing hardship. The Illinois Hospital Association isn’t blowing smoke when it warns the cuts could force some hospitals to close, eliminate services, trim jobs and create “health care deserts” in several portions of the state — including Southern Illinois. Medical care isn’t easily attained now, short of emergencies.
Instead of asking providers to accept reduced payments for care they are required to provide, every step must be taken to ensure Medicaid benefits are provided only to those patients who truly are in need. A doubling of the eligibility list in 10 years is tough to accept as legitimate. The state’s population isn’t dramatically growing and the recession, though lengthy and harsh, was less responsible for the growth than a state government unaccustomed to saying “enough!”
Illinois has 2.7 million Medicaid recipients and a total of 12.86 million residents. Children make up more than 60 percent of those eligible for Medicaid. Adults with disabilities, who comprise about 10 percent of the total, account for more than 35 percent of costs. It won’t be popular, but closer scrutiny must be devoted to Medicaid for children.
It won’t be possible to close the gap on the growing Medicaid debt entirely by trimming eligibility and eliminating fraud, but the actual reduction might be higher than Quinn’s proposal estimated. Our lawmakers need to look at other solutions for closing the gap instead of cutting rates for providers. Alcohol abuse is linked to many health problems; how much revenue might be generated by boosting the taxes on beer, wine and spirits?
Instead of putting state hospitals on the defensive, our legislative leaders should be working with the Illinois Hospital Association to develop realistic alternatives to excessive Medicaid rate cuts. With the state’s next fiscal year set to begin July 1, there is adequate but not plentiful time to thoroughly review all aspects of Quinn’s Medicaid proposal.
Bipartisan teamwork and statesmanship are especially in need. Quinn’s administration has simplified the Medicaid reform task by offering up plans to drive revenue and achieve real savings. What’s needed now is a comprehensive and deep review of all alternatives to an excessive Medicaid rate reduction that only will harm health care.
To read full article on The Southern
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