Payment to state employees’ medical providers may stop

By Mark Fitton
Illinois News Network

SPRINGFIELD — It’s cash up-front for many state employees needing medical services, or it likely soon will be.

The state’s Department of Central Management Services, a branch of the Rauner administration, has notified state employees it soon may not be able to pay medical providers.

“All healthcare services will continue to be paid as long as possible,” CMS Director Tom Tyrell told state employees in a memo dated Sept. 9. “However, in the near future, we will no longer have the legal authority to pay healthcare vendors for their services.”

CMS acknowledged that some providers in the state’s self-insured plans, such as Cigna and HealthLink, already may have begun asking state employees for cash at the time of service.

In the case of medical providers, the provider will reimburse the employee once the provider gets paid, the memo said. For dental claims, Delta Dental will file the claim on behalf of the employee, and the plan will reimburse the member.

Tyrell cited the lack of fiscal year 2016 state budget as the reason.

“As you are likely aware, no budget has been enacted for fiscal year 2016, which began on July 1, 2015,” he wrote.

“The lack of state budget has put Department of Central Management Services in unchartered territory with respect to funding critical state services, including healthcare services for all plan participants enrolled in the State Employee Group Insurance Plan,” Tyrell said.

The memo, which was posted to a state website, surprised Council 31 of the American Federation of State, County and Municipal Employees, a spokesman told the State Journal-Register in Springfield.

“We will do everything possible to correct it,” said Anders Lindall of AFSMCE, who called the news “disturbing” and “further evidence our state is breaking down.”

The governor’s office referred questions to CMS.

CMS spokeswoman Meredith Kranz said all applicable funding from fiscal year 2015 has been exhausted.

“Until the General Assembly passes a balanced budget for FY16, there is nothing else the administration can do to continue to pay healthcare providers. Without a budget in place, there is no mechanism to generate adequate revenue for the healthcare fund or pay expenditures,” Krantz said in a Monday afternoon email to Illinois News Network.

The Illinois Hospital Association said it found the news disturbing.

“Illinois hospitals are deeply concerned that the failure of the State to pay for health care services provided to state employees, as well as the 3 million Illinoisans insured by Medicaid, will soon start to jeopardize access to health care for patients and communities throughout Illinois,” spokesman Danny Chun said in a prepared statement.

He said hospitals and other critical care providers could “be forced to reduce services, lay off staff, delay paying vendors, and even close, because of the state’s failure to pay its bills on time.”

Chun said the association urges “the governor and the General Assembly to find common ground on the state budget so all Illinoisans will continue to have access to needed health care services.”

Rep. Mike Smiddy, D-Hillsdale, on Monday said he’d read of the CMS memo and the news struck him as a reminder the state needs not only a fair resolution to the budget impasse, but a fair new contract for thousands of state employees.

“Honestly, I think this puts the governor in a bad light,” Smiddy said. “The courts have already held that the employees should be paid and, at least to my mind, that would include paying for medical services.”

The state’s contract with AFSCME, which represents some 35,000 state employees, expired at the end of June. Despite related battles in the courts and Legislature, the two sides of have promised to continue talking without threat of strike or lockout.

At the same time, the first-year Republican governor and legislative Democrats remain locked in a budget impasse with the state now more than 75 days into fiscal year 2016.

Sen. Matt Murphy of Palatine, deputy Republican leader in the Senate, said the onus for a fair budget deal also is definitely on Democrats, particularly House Speaker Michael Madigan of Chicago.

“Hey, everybody wants to have a revolution, but sometimes when two people can’t get along, it really is just one of them,” Murphy said. “I’ve watched the governor come halfway more than once with the speaker, and I don’t think the people of Illinois elected Bruce Rauner to totally capitulate.”

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