Illinois Gov. Rod Blagojevich has signed legislation to tax Illinois hospitals serving Medicaid patients, a move meant to secure up to $430 million in extra federal matching funds for the state Medicaid program.
The CMS must approve the plan, which would establish an $84.19 tax per inpatient day. In return, the state's hospitals would receive $300 million in extra Medicaid payments, while the remaining $130 million would be used for other state healthcare expenses, officials said.
Blagojevich's office said the governor delayed signing the legislation until he received a commitment in writing from legislative leaders that some proceeds would be set aside to accelerate Medicaid payments to providers.
At the request of legislative leadership, a portion of the funds would be used to pay for services to developmentally disabled individuals and for nursing homes.
The Illinois Hospital Association wrote the legislation to avert Medicaid reimbursement cuts.