Illinois Enacts Medicaid Cuts

Under a health care compact, participating states would be responsible for managing their own Medicaid and Medicare programs. That means states would be responsible for making sure health care expenses don't spiral out of control. Last week, Illinois showed what that kind of leadership might look like.

On Thursday, the Democratically controlled Illinois House voted 94-22 to impose more than $1.6 billion in cuts to the state's Medicaid program. Later that day, its Democratically controlled Senate agreed by a vote of 44-13. Gov. Pat Quinn, also a Democrat, has indicated he will sign the bill. Jack Nicas and Mark Peters of The Wall Street Journal describe the bill's cost-saving measures:

In addition to $72 million in cuts from terminating prescription-drug subsidies for low-income seniors, the cuts include $50 million from tightening the eligibility requirements for Family Care, a health-insurance program for adults with children, and $35 million from eliminating certain dental-care coverage for adults. The legislation would save $240 million by cutting reimbursements to most medical providers by 2.7%.

Quinn is also looking to raise revenues to address a $2.7 billion gap in the state's $15-billion Medicaid budget. Among the ideas being considered, according to the Chicago Tribune, is a $1 per pack increase in the cigarette tax.

Illinois has crafted a solution to its Medicaid crisis in a way that is palatable to the majority of its legislature. The approach in California or Texas or New York will likely be something completely different. The agreements a health care compact makes on the state level will differ depending on the state implementing it.

While health care compacts cannot make Medicaid problems disappear, they do put the problems under local control so states become masters of their own destinies. On an issue that is causing gridlock in Washington D.C., Illinois legislators have shown that the ability to compromise for the common good is still strong at the state level.

Source: "$1.6 Billion Budget Cut Passed for Illinois Gap," The Wall Street Journal, May 25, 2012.

Source: "Illinois Legislature passes $1.6 billion in Medicaid cuts," Chicago Tribune, May 25, 2012.

Image courtesy of aka Kath used under its Creative Commons license.

Steve O'Keefe is a freelance writer, author and book editor.