Gov. Quinn signs $2.7B Medicaid cuts, cigarette tax - FOX 32 News Chicago

Gov. Quinn signs $2.7B Medicaid cuts, cigarette tax

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CHICAGO (Associated Press) -

Advocates for the poor, disabled and elderly criticized Gov. Pat Quinn for signing legislation Thursday that cuts $1.6 billion from state health care spending.

Quinn achieved one of his top legislative priorities with the multi-layered, $2.7 billion package of cuts and taxes designed to repair a long-term deficit in the state's Medicaid program. The Chicago Democrat signed five bills, including a tax increase on cigarettes of $1 per pack.

Thousands of Illinois residents will lose benefits or their state health insurance coverage entirely. Barbara Otto of the Chicago-based national nonprofit Health and Disability Advocates berated the way Quinn left it up to legislative leaders in both parties to work out specific Medicaid cuts.

"What kind of victory is this?" Otto said. "Cutting people off of Medicaid, in my mind, shows a lack of leadership."

Kathy Chan of the Illinois Maternal and Child Health Coalition said her group is relieved most services for children were preserved but disappointed more than 25,000 working parents will lose state health coverage July 1.

"While these cuts may save money in the very short term, delayed care and treatment resulting from eligibility cuts and reductions in services are very likely to result in higher costs and worse health outcomes in the long-term," Chan said.

The higher tax on tobacco products is expected to generate about $350 million, money that will be matched by the federal government to produce about $700 million for Medicaid.

Foes of the cigarette tax, which would more than double the current rate, have said it will encourage smokers to cross state lines to buy their cigarettes outside Illinois.

The American Heart Association and American Stroke Association praised the cigarette tax, saying it will prevent thousands of smoking-related deaths and shore up Medicaid, but other health advocates decried the spending reductions.

The cuts also end a program called Illinois Cares Rx that helped nearly 200,000 senior citizens with prescription drug costs. The program ends July 1 and its demise is projected to save about $72 million.

"Quinn promised a haircut," said David Vinkler of AARP. "The complete elimination of Illinois Cares Rx is more of a decapitation for thousands of seniors."

Advocates pledged to make their case with lawmakers in future legislative sessions.

Speaking with reporters outside the governor's mansion in Springfield on Thursday, Quinn avoided predictions about Medicaid's future, saying his administration would review it "year by year."

One national health policy expert said it's difficult for states to restore Medicaid benefits once they've been cut, especially during times of fiscal constraint.

"Unless there is solid evidence of cost saving or specific health improvement and pressure from outside groups, these cuts will likely not be restored," said Lynn Blewett of the State Health Access Data Assistance Center at the University of Minnesota in Minneapolis.

Illinois Hospital Association President Maryjane Wurth praised the governor and the Legislature for "making difficult decisions during these challenging economic times and for their commitment to the health of Illinoisans," according to a statement. The organization represents about 200 hospitals and played a big role during negotiations.

Safety-net hospitals and rural hospitals avoided Medicaid payment cuts. Other hospitals will see a 3.5 percent rate cut. Investor-owned hospitals got a new tax break in the legislation, and nonprofit hospitals, which were in jeopardy of losing valuable property tax exemptions because of an Illinois Supreme Court ruling, won a broad definition of charity care that will allow them to avoid paying property taxes.

Diane Limas of the Fair Care Coalition, a group that was pushing for wealthier hospitals to provide more free care, praised the provision that requires Illinois hospitals to provide free surgeries and other inpatient care to many uninsured poor people. But Limas criticized the new tax break for investor-owned hospitals "at a time of one of the worst revenue crises the state has ever experienced."

The bills are SB2840, SB2194, HB5007, SB3397 and SB3261.

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