Governor Quinn Signs Landmark Medicaid Reform Legislation
CHICAGO – January 25, 2011. Governor Pat Quinn today signed legislation establishing comprehensive Medicaid reform in Illinois. House Bill 5420 was crafted by bi-partisan legislative committees and passed both houses of the General Assembly with bi-partisan support.
The law will enable the Department of Healthcare and Family Services (HFS) to improve efficiency and streamline services by: expanding coordinated care in Illinois, improving the efficiency of the prescription drug program, tightening the integrity of the eligibility process and increasing civil penalties for recipients who abuse the system. The reforms are expected to achieve savings of $624 million to $774 million over five years.
“Medicaid reform is one part of my plan to stabilize our budget. A priority of my administration is eliminating inefficiencies, so that we are saving money while delivering better services to those that most need them,” said Governor Quinn. “I would like to thank HFS and the members of the Senate and House Special Committees on Medicaid Reform who worked closely in a bi-partisan spirit with my office to make this legislation possible.”
The groundbreaking, bi-partisan reform legislation was crafted under the direction of Governor Quinn and administration officials, working in concert with the Senate and House Special Medicaid Reform Committees. HB 5420 was sponsored by the co-chairs of the two committees: Sen. Heather Steans (D-Chicago) and Sen. Dale Righter (R-Mattoon), and Rep. Barbara Flynn Currie (D-Chicago) and Rep. Patricia Bellock (R-Hinsdale).
“This legislation is a result of bi-partisan commitment to protect patient health, while implementing much-needed reforms and saving taxpayers money,” said HFS Director Julie Hamos. “Governor Quinn has directed this department to transform Medicaid in Illinois into a program that works to keep people healthy, rather than one that simply pays bill after they become sick. This measure grants us the authority to move forward with the Governor’s directive.”
Under the new law, HFS will improve the efficiency of the program by expanding coordinated care to cover at least 50 percent of recipients by 2015. It also authorizes the department to enhance the integrity of the eligibility process, subject to federal approval, by requiring proof of Illinois residency; tightening income verification by requiring a month’s worth of income information, instead of a single paystub; and requiring annual redetermination of eligibility.
The law also will allow the department to save on prescription drug costs by maximizing co-payments, promoting 90-day maintenance prescriptions and controlling utilization, and reducing prompt payment interest rates for pharmacy bills from 2 percent to 1 percent.
Other major reforms include:
- Enhancing restrictions and civil penalties for recipients who abuse the system.
- Establishing a moratorium on eligibility expansions.
- Limiting income of future All Kids enrollees to 300 percent of the federal poverty level.
- Extending the sunset of All Kids from 2011 to 2016.
- Phasing out the practice of allowing unpaid bills from one year to be paid in the next fiscal year.
- Requiring HFS to study the impact of income limits and cost-sharing opportunities for medical programs available to children under the Public Aid Code where there is no parental-income threshold.
Illinois’ Medicaid program, which is administered by HFS, provides health coverage to 2.8 million low-income individuals and families, people with disabilities and older adults.