An Update on Medicaid Reform

In case you missed the results of Medicaid reform amid all the news of the massive tax hike last week, here are the details.

by Amanda Griffin-Johnson

As the 96th Illinois General Assembly came to a close last week, the massive personal and corporate income tax hike overshadowed other legislative outcomes, such as Medicaid reform. Medicaid continues to account for more and more of the state budget, and reforms are needed to ensure the program’s sustainability. While there are still significant reforms to be explored, such as Medicaid Savings Accounts or federal waivers to allow increased flexibility in administering the program, the reforms in HB5420 are a good first step towards strengthening this important safety net. The reforms are expected to save $800 million in the next five years, and the bill passed with overwhelming bipartisan support in both the Senate (58 yeas, 0 nays, 1 present) and the House (111 yeas, 4 nays, 2 present). The legislation has been sent to Governor Quinn and awaits his approval. Reforms in HB5420 include:

• Transitioning individuals from institutional care settings to community-based long-term care programs;
• Changing eligibility verification through:
  • Active eligibility redeterminations,
  • The use of one month’s income (rather than two weeks) to verify
    income requirements upon application for benefits as well as during
    annual redeterminations of eligibility, and
  • Verification of state residency.
• Transitioning 50 percent of Medicaid recipients into coordinated care programs by January 1, 2015;
• A two-year moratorium on Medicaid eligibility expansions;
• An income cap on the All-Kids program at 300 percent of the federal poverty level (currently $66,150 for a family of four); and
• Measures to enhance fraud detection and prevention.