Ill. medical society, state feud over licensing woes

The state of Illinois has informed new and transferring doctors to expect delays in issuing their medical licenses and says it's all the Illinois State Medical Society's fault—while the physicians' group argues that the state's improper use of cash collected from medical license fees is to blame.

Regardless of who is at fault, Manuel Flores, acting secretary of the Illinois Department of Financial and Professional Regulation, said that his department's medical unit will lay off 69% of its staff—going to eight employees from 26—effective Jan. 15.

This action, Flores said in a letter to healthcare professionals (PDF), is a result of the ISMS' successful lobbying effort against a state bill that would have allowed the IDFPR medical unit to borrow $9.6 million against future collections of licensing fees to avoid layoffs.

“As a direct result of ISMS' actions, the layoffs will occur,” Flores said in the letter. “Please be further advised that the Department will have one employee to handle all physician licensing requests in Illinois. Licenses for new physicians and for physicians transferring to Illinois will take between 12 and 18 months to process.”

He added that graduating medical students seeking to undergo residency training with hospitals in Illinois will see similar delays, and doctors needing to renew their licenses in 2014 may see their licenses expire before the renewal process is complete. Flores also noted that physician license fees, $100 a year, have not changed since 1987.

In a statement, Dr. William Werner, ISMS president (PDF), said that almost $9 million has been diverted from the Illinois Medical Disciplinary Fund for other purposes, and he stated that it's his organization's position that diverted funds should be returned and the department should not borrow against future collections to pay for current operations.

“Illinois' practice of delaying payment for financial obligations must end,” Werner said. “Sufficient monies to finance medical discipline and licensure were collected and diverted. It's now time to restore this money to its intended purpose.”

In a Jan. 9 letter to Flores, Dr. Steven Malkin, chairman of the ISMS board of trustees (PDF), expressed support for Flores' department and the work of its medical unit and said he looked forward to collaborating in the future—but, again, the ISMS' total opposition to diverting medical fee dollars for other purposes was noted.

“Please understand that despite this opposition, ISMS is sympathetic to the challenges IDFPR faces in the absence of a funding infusion,” Malkin wrote. “We realize the Department is not at fault in creating the shortfall; however, allowing this transfer scheme to continue endlessly makes the Medical Fund ripe for further raids, prompting further increases in physician licensing fees. We must put a stop to it.”

Illinois is not alone in using medical fees to make up for shortfalls in its state budgets. California and others states have done the same, prompting the Health Research Group of the Public Citizen consumer advocacy organization to speak out against the practice.

The Federation of State Medical Boards, a Dallas-based organization comprised of 70 medical and osteopathic boards in the 50 states, Washington, D.C., Puerto Rico and U.S. territories, said it is keeping an eye on the situation in Illinois.

“We are concerned about the marked decrease in staffing that is envisioned and the potential impact on the ability of the state medical board to effectively license and regulate physicians in Illinois,” Dr. Humayun Chaudhry, FSMB president, said in an e-mail. “We are monitoring the situation.”