November 24, 2010

Lawmakers returned to their districts this week to celebrate the Thanksgiving holiday, but are scheduled to return to Springfield on Nov. 29 with plans to review the state’s Medicaid program and workers’ compensation laws.

Both the Special Committee on Medicaid Reform and the Special Committee on Workers’ Compensation Reform are scheduled to meet at 1:00 p.m., Nov. 29, in Springfield. Lawmakers serving on the special committees plan to meet throughout December in order to submit reports on the issues by a Jan. 3, 2011, deadline.

Medicaid reform has been discussed for years, and numerous studies have been conducted on the issue. The research spawned a number of legislative proposals to restructure Medicaid, but no significant action has been taken to reduce the overwhelming financial burden of the program.

There are more people on Medicaid today than at any time in the history of our state. With the federal health care plan scheduled to take effect in 2014, it’s imperative that Illinois adopt reforms to streamline Medicaid services and reduce wasteful spending.

Currently, Illinois’ Medicaid program costs more than $10.6 billion per year and continues to grow at a rate far outpacing state revenues. As a result, many medical providers wait months before they are reimbursed by the state for services provided to Medicaid patients. The extreme payment backlog has led to financial hardships for the providers and serious access issues for Medicaid patients.

Senate Republicans have advocated transitioning to a managed care system, which would establish a primary “medical home” for Medicaid recipients. Nationally, states have been moving toward managed care, where patients have physicians who are responsible for monitoring and managing their care. Research has found that adopting managed care principles often translates into better care for the patients, while reducing costs to the state.

The Senate GOP is also advocating the state tighten existing Medicaid eligibility guidelines. Currently Medicaid applicants need only provide one pay stub to determine their annual income for eligibility purposes. Additionally, a Medicaid applicant is presumed eligible for the program before his or her eligibility is determined by the state, meaning taxpayers may incur medical costs for individuals who are not even eligible. Senate Republicans also say the state needs to review and reform Illinois’ process of re-determining Medicaid eligibility and incorporate asset testing into eligibility criteria.

Senate Republicans have also been pushing for workers’ compensation reforms in order to reduce costs for business and industry, and make Illinois more cost-competitive.

Currently, Illinois is the third highest in the nation when comparing workers’ compensation insurance costs to employers. This rate puts Illinois at a competitive disadvantage, especially compared to surrounding states that have very low workers’ compensation rates.

The business community has in the past proposed several reforms they believe would reduce workers’ compensation rates, including establishing a primary cause standard, requiring the workplace to be the principal cause of an injury.

Other suggested reforms include tightening impartiality requirements for arbitrators and commissioners, who interpret the Workers’ Compensation Act. Another recommended change would be to tighten standards for injuries caused by alcohol or drug abuse on the job, and to establish objective medical standards when determining permanent partial or total disability.