Illinois Gov signs medicaid cuts

Illinois Governor Pat Quinn has signed a large package of cost cutting and revenue enhancing measures aimed at controlling the state’s Medicaid program. The Governor says the cuts were necessary to avoid more damage to the system although advocates for the poor are already calling for repeal.

Quinn set a goal of saving $2.7 billion in Medicaid costs this cycle, and said in a statement that this package of legislation would do that. Medicaid and the state pension program alone account for almost 40% of the state budget. Legislators were unable to come through on a deal for pension reform in this session – leaving open the possibility that the two programs may end up taking half of the state’s budget by next year.

Under the terms of the Medicaid package, fewer Illinois residents will be eligible for Medicaid, some programs have been cut completely and provider rates have changed. Taken together, the measures save almost $2 billion. The state also established new standards for non-profit hospitals, a move that will increase tax revenues as some hospitals will no longer meet tax exempt status.

Advocates for senior citizens and the poor have come out against the bills which they say further limits access to health care. One of the programs cut helped senior citizens afford the costs of their medications. Limiting eligibility may keep some families out of the program who would have otherwise been served.

The state also increased the amount of sales tax charged on a pack of cigarettes – the revenue on the increase will go into the Medicaid program.

“One of our most important missions in Springfield this year was to save Medicaid from the brink of collapse,” Governor Quinn said in a statement.

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