Illinois Budget: Governor Pat Quinn’s Office Fears Illinois Medicaid May Face $750 Million Cut

(Springfield, IL) — July 23, 2010. Furlough days for thousands of state workers and much later Medicaid payments could be just the beginning.

Governor Pat Quinn‘s office is, for the first time, acknowledging that the state may not get $750 million from Washington for the neediest families in Illinois.

The so-called FMAP money — Federal Medical Assistance Percentage – has been tied up on Capitol Hill for months as states lobbied the federal government to extend the increased Medicaid reimbursements set to expire Dec. 31.  Christina Mulka with Illinois U.S. Senator Dick Durbin‘s office said many states are waiting on millions of their own.  But she said the cash has become part of an election-year battle.

“FMAP was tied to the unemployment extension, but was stripped out so [an extension] could be passed,” said Mulka.

Mulka said Republican opposition to the Medicaid extension has halted any momentum for the program for the foreseeable future.  But she said Durbin is still “going to work on” FMAP.

That’s how the governor’s budget office sees things as well.  Kelly Kraft with the Quinn budget office says the administration is still holding out hope for an extension of the federal stimulus money. But she admits it’s a long shot.

“[An extension] may not happen, Kraft said.  “And if it doesn’t the governor is looking at further economies.”

It will take a lot of economies to close the gap left by FMAP.  The state’s new budget counts on $750 million dollars of the increased Medicaid payments.  The governor’s office will have to replace that money, while at the same time trying to close Illinois’ $13 billion deficit.

Kraft said Quinn has already started that process.

“The 24 furlough days [ordered earlier this month] is aimed at closing that $750 million gap,” she said.

The order for furlough days is expected to save $18 million over the course of a year.  Kraft is not saying where the state will find the rest of the cash.

But she acknowledged that hospitals, doctors, and nursing homes that rely on Medicaid money will suffer.

The federal stimulus money came with the requirement that  Illinois pay those Medicaid providers within 30 days.  Without a Medicaid extension, Kraft said it will take longer to pay those bills.  Right now other people and businesses owed money by the state are waiting 153 days for a check.

Republicans in Springfield have blasted the governor for including the Medicaid extension in the new budget since the continued boost in funding was not a done deal.

Kraft said Illinois is not alone.  She points out that many other states crafted their budgets on the assumption that Congress would OK the extension.

“[The Quinn administration] did not feel it was premature to include [the $750 million] in the budget,” said Kraft.

Quinn has said repeatedly that the budget is not a “one day document,” adding that he will manage the spending plan throughout the year.

Kraft said the governor has already used his emergency budget powers this month by ordering those 24 unpaid days for non-union state workers.

Kraft said she expects Quinn to issue an emergency budget order at least once a month.

–Benjamin Yount, Illinois Statehouse News