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Feds halt Illinois Medicaid reform

The federal government says Illinois cannot ask Medicaid recipients to prove how much they earn or where they live.

By Benjamin Yount

The federal government says Illinois cannot ask Medicaid recipients to prove how much they earn or where they live.

The federal Centers for Medicare and Medicaid Services, the department that manages both programs in Washington, D.C., told Illinois' Medicaid managers last month that two of 15 reforms recently passed by the General Assembly and signed by Gov. Pat Quinn violate federal rules that prohibit states from changing criteria for anyone receiving Medicaid.

The reforms passed earlier this year require Illinois Medicaid recipients to prove they qualify for the program, that they are indeed earning within 300 percent of the federal poverty level — $67,050 for a family of four — and that they live in Illinois.

U.S. Sen Mark Kirk, R-Ill, said Illinois' verification requirements are designed to prevent fraud.

"We are worried, because this will now cost the state of Illinois $800 million over (six) years," said Kirk. "This is the fastest growing part of the Illinois budget."

President Obama's health care reforms prohibit states from tightening eligibility requirements for Medicaid. States are required to live by the rules and regulations that existed in March 2010. Illinois' Medicaid reforms were passed in early January.

Kirk said at a Monday news conference that he is asking the CMMS to reconsider because the intent from state lawmakers was not to toss people out of the Medicaid program. If that fails, he said he is willing to push Congress for legislation to change the rules.

State Rep. Patti Bellock, R-Hinsdale, who helped write the Medicaid reform package, said stopping fraud is the first step that must be taken if Illinois is going to contain the sky-rocketing costs of Medicaid.

"Fifty percent of all births in Illinois is on Medicaid," Bellock said. "One out of every three children in Illinois is on Medicaid, and one out of every five Illinoisans is on Medicaid."

Bellock said that in 2006, Illinois spent $7 billion on Medicaid. This year Illinois is poised to spend $15 billion. That is nearly half of the $33.4 billion budget signed by Quinn.

U.S. Rep. Judy Biggert, R-13th District, said that with all of the recent focus on federal debt and federal spending, the government should jump at any chance to save hundreds of millions of dollars.

"The state and the federal government have a partnership," said Biggert. "It should not be a dictatorship."

Biggert said she'd like to see the Obama administration reverse the ruling, though she's not hopeful.

"I don't think this is something that just happened," Biggert said. "The other side of the aisle wants to make sure that everyone can be on these programs."

Bellock is quick to point out that Illinois' Medicaid reform laws had support from both Republicans and Democrats and were signed by a Democratic governor.

Mike Claffey, a spokesman for the Illinois Department of Health Care and Family Services, which runs the state's Medicaid program, said Illinois will press ahead with other reforms that could strengthen the system.

"While we are disappointed by the denial, we are pressing ahead to implement these reforms through other means that we believe will receive approval," said Claffey.

Claffey said the state will be able to use electronic databases to cross-check and verify income and residency information.

But Bellock said she's waiting for the other shoe to drop.

"We just have to wait and see about the rest of the reforms," said Bellock.

Lawmakers passed a series of additional Medicaid reforms, namely increasing the amount that Medicaid recipients pay, last spring. Quinn signed the reforms last month. The federal government has not yet weighed-in on those changes.

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