Progress Illinois

Just when it appeared that the U.S. Congress was prepared to leave state governments flailing in the wind, a few key Democrats are making some noise on Capitol Hill about re-upping their support for Medicaid assistance and a successful TANF jobs program. Annie Lowrey has gathered the latest developments at the Washington Independent.

With Medicaid primed to expand because of the the federal health insurance legislation, private insurance companies are lobbying cash-strapped state governments like Illinois to outsource more of their health care programs into private "managed care" systems.  

Too often, however, the risks of such policies are altogether ignored. In a must-read piece this morning, the Washington Post's Alex MacGillis describes the "steady stream of controversies" that private managed care has produced elsewhere in the country. For example, a May study (PDF) by the U.S. Department of Health and Human Services found that 2.7 million children on Medicaid in nine states, most of them states that outsource Medicaid, are not receiving required screenings and immunizations. And Wisconsin just canceled contracts with two provider networks who it alleges were "creating profits at the expense of patient care."

Illinois has had similar experiences in the past. Indeed, one particular managed care organization systematically avoided enrolling pregnant women and unhealthy patients between 2000 and 2004, despite receiving $234 million from both the state and federal government to do just that. Private insurers can also carry higher administrative costs, many of which are hidden by the providers.

When the state's public managed care programs are working as well as they are, why change course?

Now that it appears unlikely that Congress will extend the enhanced Medicaid matching fund rate included in last year’s stimulus bill -- thereby blowing a $450 million hole in the Quinn administration's revenue projections for FY 2011 -- Republicans are coming out of the woodwork to blast Democrats for what they consider "overoptimistic" budgeting. "To them, whether it's $6.5 or $7.5 billion our of line, it doesn't really matter," State Rep. Dave Syverson (R-Rockford) said yesterday. Syverson also questioned the amount of resources the state is spending on public health during the recession, asking if Illinois is "going to have the richest Medicaid system in the country?"

The answer to his second question, by the way, is a resounding no; David Ormsby notes that Illinois spends less per patient than 41 other states. That's partly because we stiff providers; but it's also the result of serious reforms that are holding down costs and improving care. And the GOP's "overoptimistic" argument is a bit silly, as well. State governments in 30 different states similarly assumed that Congress would extend the stimulus matching rate. Furthermore, when given the chance during session, the GOP "did not propose a single appropriations bill or amendment to address this problem," as Capitol Fax points out.

As the New York Times editorial board noted this morning, it's becoming more and more clear that the U.S. Senate is in no rush to extend the filing deadline on unemployment aid, even as hundreds of thousands of jobless workers lose their benefits each week. But that doesn't mean some in Congress aren't still trying to figure out a way to push the "extenders" bill through.

House Speaker Nancy Pelosi (D-CA) said yesterday that she planned to hold a bill to preserve Medicare reimbursements rates -- the so-called "doc fix" measure -- until the upper chamber acts on the jobs bill. As of yesterday, Senate negotiations were focused on swaying Olympia Snowe and Susan Collins. The two Maine Republicans are demanding that, in exchange for their vote, the Democrats curtail an extension of the enhanced Medicaid matching fund rate included in last year’s stimulus bill.

Here's the catch: Doing so would blow an estimate $230 million hole in Illinois' FY 2011 budget. (As in numerous other states, lawmakers anticipated receiving the extra Medicaid funds when drawing up the spending plan).  Taking it out would almost certainly mean more budget tightening (i.e., layoffs).  At a time when polls suggest Americans are more worried about jobs than the long-term deficit, that seems like a dumb move politically. But if Collins and Snowe are the only gettable votes from the GOP, it might be the Democrats' only option to keep the unemployed afloat.