Illinois Senate advances Medicaid reform measure

The Illinois Senate overwhelmingly approved a Medicaid reform measure that many agree is a good step forward on the way to restructuring Illinois’ health care program for the poor and disabled
Currently, there are 2.8 million Illinois residents enrolled in Medicaid, and the program is at an all-time, unsustainable high. For years the Senate Republican Caucus has said that the state simply can’t keep up with the growth of the Medicaid program, which has consumed more and more of the budget each year.

House Bill 5420 targets inefficiencies in the system that will not only help contain the unsustainable growth of the program, but also ensure program recipients are receiving the best possible health care.

State Sen. Dale Righter (R-Mattoon) was a sponsor of the legislation, and said that the measure embraces the national trend toward managed care principles. For many years Senate Republicans have urged a movement towards managed care which has been shown to reduce costs, while improving patient care.

“Utilization of managed care principles will increase dramatically over the next four years under this legislation. Ultimately 50 percent of all people will be required to be in a system of care coordination, or managed care, which will provide for better care for the enrollees and save taxpayer money over the long haul,” explained Righter.

If signed into law the measure would eventually eliminate the “Section 25” loophole that has allowed the state to pay Medicaid providers late. Over the years this loophole has enabled Illinois government to defer payments to doctors, pharmacists, hospitals and nursing homes while portraying deficit spending as “balanced.” House Bill 5420 will eliminate the ability of state government to do that.

Righter noted that one of the most important components of the bill is a two year moratorium on any new Medicaid programs or expansions of Medicaid programs, which is meant to send a clear signal that Illinois needs to control program expansions.

“One of the real issues Republicans have had over the last several years with regards to public assistance programs is the unwillingness of the state’s leaders to tighten down on eligibility or verification of the people who are on Medicaid. This bill will make a dramatic change." Righter said, explaining that the measure will require more accurate reporting to better reflect an applicant's true income.

The senator also explained that the legislation will also require active redetermination: “In other words, if someone has been on the program for 12 months, it’s been the practice of the HFS over the last several years to simply send a letter out asking if their circumstances have changed. Even if they didn’t get a letter back, the patient was left on the program. That’s going to come to an end.”

Another key provision of the bill will impose reasonable income restrictions on the state's "All Kids" programs, which previously did not contain any income limits. An auditor general review last year found that even at the highest income levels, which could exceed $100,000, taxpayer dollars were subsidizing health insurance costs.

Having been advanced by the Senate, House Bill 5420 now moves to the Illinois House for consideration.


Senate Republican Caucus
309 State Capitol
Springfield, IL 62706