Medicaid

The Medicaid program is not just for the poor. It is also a health care safety net for people who are temporarily unemployed or who have lost their employer-based health care benefits - especially now as the economic downturn continues and more people lose their jobs. It is critical that Illinois maintain and protect this safety net and provide sufficient funds for the Medicaid program.  

Medicaid serves the elderly, the blind, persons with disabilities, pregnant women, children, and the parents of many covered children. The Illinois Medicaid program covers more than two million individuals annually. Hospitals deliver inpatient and outpatient services to hundreds of thousands of Medicaid recipients - providing 1.7 million days of care and more than 2.9 million outpatient visits each year. Medicaid pays for half of all Illinois births and one out of six hospital admissions.

Illinois hospitals have partnered with the State of Illinois to develop three Hospital Assessment Programs over the past five years. These programs provide new federal and hospital tax funds for the state's Medicaid program - to help boost inadequate hospital reimbursement base rates that have not been updated in nearly 15 years. Moreover, by the end of the current assessment program, the three assessment programs will have generated a total of $3.5 billion for other Medicaid services, such as long-term care and developmental disability services.

Medicaid inpatient base rates for Illinois hospitals have been frozen since 1995 and cover, on average, only 75% of hospital costs (without payments from the Hospital Assessment Program). Medicaid outpatient base rates for hospitals are now lower than they were in 1998. Hospitals are also carrying an ever increasing financial burden because of long payment delays in the Medicaid program.

The combination of very low plus slow payments means many hospitals must take out loans or lines of credit to make payroll and other basic operating expenses, postpone upgrading services and obtaining new life-saving equipment and technology, and delay necessary maintenance. The State needs to find the resources to adequately fund Medicaid based on a steady, reliable, broad-based revenue source.

Hospitals are not asking for a bailout, they are only asking for what they are owed and deserve - adequate and timely reimbursements for caring for Medicaid patients - as part of their partnership with government to serve the State's most vulnerable populations and to protect the health care safety net. Hospitals have fulfilled their end of the partnership.