Illinois Republican Gov. Bruce Rauner Wednesday proposed cuts of $1.5 billion to his state's Medicaid program, saying the state will become more aggressive in ferreting out current Medicaid recipients who do not actually qualify for the program.
Other healthcare cuts in the governor's proposed fiscal 2016 state budget (PDF) include eliminating nonmandatory adult services from Medicaid, cutting certain payments to hospitals, and moving some medical-assistance recipients onto exchange plans.
Medicaid advocates are warning that the proposed program cuts will have dire consequences for the state's poorest individuals, who are also often the most ill.
“It's hard to imagine how one could possibly cut that much from the Medicaid program without seriously hurting quite a lot of people,” said Anne Marie Murphy, a former director of the Illinois Medicaid program.
The Rauner administration is ordering the state's health department to reinstate an “aggressive review” of the Medicaid rolls. More than 250,000 people receive Medicaid services whose eligibility has not been reviewed, contend Rauner budget documents. Illinois has nearly 3.5 million residents who are eligible for Medicaid, according to the budget document released Wednesday. The state will use new and aggressive techniques to detect and prevent fraud among providers, the governor said.
Rauner's budget proposes an allocation of nearly $19 billion for Medicaid to the state's Department of Health and Family Services, which runs the program. The proposed budget eliminates adult services, including dental care and podiatry, that are not mandatory for the Medicaid program. Former Gov. Pat Quinn, a Democrat and Rauner's predecessor, had restored dental and podiatry services after previously cutting them from the program in 2012.
The governor is adding about $5,000 to the state's Medicaid Fraud and Abuse Prevention Fund and is stressing that the agency needs to watch costs while only keeping eligible Illinoisans on its rolls.
“Increasing the integrity of the Medicaid system will ensure that money goes only to care for those who qualify for help, and will free up dollars to help those most in need,” the administration said.
The administration also estimates that it will save $41 million by moving people off state medical assistance and onto exchanges established under the Affordable Care Act.
“In order to maintain a commitment to service for such a growing population, HFS must concentrate the resources of the state on those eligible for assistance and control the costs for providing care,” the governor's administration said in budget documents.
Though Republican governors have become known in recent years for cutting state budgets, significant cuts to Medicaid come as somewhat of a surprise from Rauner, said Murphy, who currently serves as executive director of the Metropolitan Chicago Breast Cancer Task Force.
“I think it probably will surprise a lot of people, because people had imagined that Gov. Rauner would be moderate, but this does not seem to be a moderate budget,” Murphy said.
Follow Adam Rubenfire on Twitter: @arubenfire
