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Illinois Policy Institute releases plan to cut $2.7 billion from Medicaid without tax hikes or rate cuts

Sen. Kyle McCarter endorses Institute’s reform plan

SPRINGFIELD, Ill. (May 20, 2012) – State Sen. Kyle McCarter has endorsed a plan by the Illinois Policy Institute to reduce Medicaid expenditures by more than $2.7 billion without tax hikes and without rate cuts to hospitals. The Institute’s plan is based on a menu of 59 reforms, and was released at a statehouse press conference this afternoon.
 
 “The Governor and members of the House and Senate agreed that it was imperative to find $2.7 billion in Medicaid savings. The plan that is being proposed and discussed by lawmakers fails to live up to that promise. Instead, tax hikes and rate cuts are being substituted for reform,” said Sen. McCarter, R-Lebanon. “We have a choice to make: Illinois can continue down the path of tax hikes and fake reform, or we can innovate and pave the way to real sustainable, long-term savings with which other states have already found success. To not consider these alternative reforms developed by the Illinois Policy Institute would be doing Illinois citizens a disservice.”

The Institute’s plan is based on streamlining Medicaid so it can operate more efficiently, and ensuring the correct services are delivered to those most in need. It is available online at: http://illinoispolicy.org/news/article.asp?ArticleSource=4854

Here are some highlights from the Institute’s Medicaid reform plan:

• Save $360 million by strictly enforcing Medicaid eligibility rules.
• Save $50 million by implementing case review, intensive case management and care coordination for high-cost cases.
• Save $200 million by aggressively managing the use of pharmaceutical drugs, which includes expanding the use of generic drugs.

Lawmakers should pursue Medicaid reforms that protect those most in need and improve the program. However, they’re currently working on a legislative package that would cement the January 2011 tax hike and add new tax increases, implement ObamaCare two years ahead of schedule and dramatically reduce the quality of care for the most vulnerable.

“Instead of cutting rates, cost-shifting and expanding a program that is already unsustainable – which will raise the cost of health insurance for all and cost taxpayers – Illinois should look to other states’ efforts and bring innovation and best practices to Medicaid,” said John Stephen, one of the architects of the Institute’s Medicaid reform plan. “All states need to reform Medicaid so that it is a 21st century program available to those who are truly eligible and truly in need of quality services.”

Illinois Policy Institute CEO John Tillman said that any legislation that relies on implementing ObamaCare early, tax hikes and rate cuts is not reform and will not solve the root causes of Medicaid’s problems.

“What lawmakers are doing is pushing a Medicaid package that does not solve the fundamental problems with the program. It is more of the same; it is status quo,” said John Tillman, CEO of the Illinois Policy Institute. “A vote for that type of plan is a vote to endorse ObamaCare; and it is a vote to endorse the 2011 tax hike that every Republican voted against. Those who voted against the tax hike in 2011 would essentially be rescinding that vote if they support this bill because it would be putting us on a path to make the tax hike permanent.”

The Institute's plan was developed by health care policy analyst Jonathan Ingram and senior fellow John Stephen. In 2009, Stephen was the Medicaid working group leader on Gov. Quinn’s Taxpayer Action Board. Stephen has advised states across the nation on reforming their Medicaid programs, and is former health and human services commissioner from New Hampshire.

Media contact: Diana Rickert (312) 607-4977