Quinn approves key piece of federal health care plan

By Jamey Dunn

Illinois took a major step today toward implementing federal health care reform law when Gov. Pat Quinn signed a substantial Medicaid expansion.

Senate Bill 26 will expand Medicaid coverage to individuals who earn up to 138 percent of the federal poverty line, which is $15,860 for adults and $21,408 for couples. This expansion of Medicaid benefits to childless adults, who were previously ineligible in Illinois, is a key piece of the Patient Protection and Affordable Care Act. Quinn said he wanted to be sure to sign the bill before President Barack Obama makes a visit to Illinois on Wednesday.

“So we can tell him we got the job done,” Quinn said in Chicago today. “This is essentially implementing the Affordable Care Act. Some call it Obamacare. I call it ‘I do care.’ And this is the way that we, the people of Illinois, are going to get more health insurance coverage for at least 342,000 of our neighbors. I think that’s really an important objective, that all of us have decent health care for everybody.” Quinn's administration estimates that 342,000 people will be covered under the expansion by 2017.

The new Illinois Medicaid population will be able to enroll in October, and their coverage will kick in on January 1, 2014.

The Affordable Care Act, as originally written, would have required all states to make the expansion or risk losing their federal reimbursements for Medicaid. But the United States Supreme Court viewed that as an overreach and ruled that states had the option to forgo the expansion without the penalty. Illinois is one of 24 states, including the District of Columbia, that moving is ahead with the expansion. Six states are still debating the issue, and 21 states have no immediate plans to expand. (For more on the Supreme Court ruling and the Medicaid expansion, see Illinois Issues September 2012.)

The federal government will cover the cost of the expansion for the first three years. Then the federal match is scheduled to taper down to 90 percent by 2020. Illinois officials estimate that the state will receive $12 billion in federal funds under the expansion by 2020. Chicago Democratic state Sen. Heather Steans, who sponsored SB 26 and serves on the Senate’s budgeting committees, said the federal money will cover some medical costs currently being covered by the state. “It replaces what the state is paying for now, what local governments are paying for right now and really all the uncompensated care that hospitals are having to do. So this is going to help every single hospital throughout the state of Illinois.” She said that more than $200 million in spending from the state’s general revenue fund would be replaced by the federal match. “This is in my view very strongly both fiscally and morally the right thing to be doing.”

Steans said that most of the people who will be able to get Medicaid coverage are employed. She said the expansion will make health care accessible for people all over Illinois. “Sixty percent of these folks have jobs ... but low-income jobs that don’t provide affordable health care,” Steans said. “It’s every single part of the state where we have people who are going to be newly eligible here. It’s critical for downstaters, for our suburbanites, for the city of Chicago. It’s everywhere.”

Chicago Democratic Rep. Sara Feigenholtz, said the expansion will bring coverage to traditional underserved residents, such as those living with mental health issues. “From the perspective of a legislator trying to meet a need, trying find a medical home for our constituents, this legislation today is the game changer.” (For more on how the expansion could affect mental health care in the state, see Illinois Issues March 2013.)

Julie Hamos, director of the Illinois Department of Healthcare and Family Services, said the expansion is not just about getting more people coverage, it’s about making sure they have efficient and effective care that will make them healthier overall. “The Affordable Care Act and the promise of the Affordable Care Act is not just about putting a health insurance card in everybody’s pocket. It’s about redesigning the health care delivery system, and we are very hard at work doing that to create coordinated integrated delivery systems that will really serve the clients,” she said. “The promise of the Affordable Care Act is to get better health outcomes for all the people in Illinois and the country, that’s the most exciting part. That’s the work still ahead of us.”

But opponents of the expansion are concerned that it would further damage an already troubled system. Ted Dabrowski, vice president of policy for the Illinois Policy Institute, said such a large expansion would redefine the nature of the program. “Medicaid was supposed to be a safety net for the poor, but when you add 25 percent of the population onto Medicaid, then it is no longer a safety net. It’s become so bloated and so expensive to run that the poorest of the poor can’t get access.” Stagnant reimbursement rates have led to some health care providers opting to not serve Medicaid patients.

Dabrowski said there could be access problems after the expansion. He said that the problems with health care in the state should be solved through the insurance market instead of through a “top down” federal plan that grows state programs. “There are legitimate problems that need to be handled,” he said. “We should fix those problems and attack those problems directly but not totally turn upside down the private market in order to reach those problems.” He said that by deciding to implement the expansion, the state is taking on future responsibility for residents who could instead buy insurance in the online marketplace that also comes along with the Affordable Care Act. SB 26 would roll back the expansion if the federal matching rates decline. But Dabrowski said that once the benefits have been given out, it is unlikely that lawmakers would support reducing them. “Most state governments have a hard time taking away any benefits they have given.”

Supporters say that the state should not pass on a golden opportunity to offer health care to a group that currently has few options and often seeks costly treatment in emergency rooms. “One would wonder why we wouldn’t want $12 billion of health care that is 100 percent match[ed by federal funds],” Feigenholtz said.

 “That’s an important fundamental right that everyone has. It’s not a privilege to have decent health care, it’s a fundamental right,” Quinn said.