Illinois’ massive, maligned Medicaid managed care expansion to start

By John O’Connor 
AP Political Writer

SPRINGFIELD — A vast remaking of subsidized Medicaid health care in Illinois, nearly a year in the making and criticized all the way, is set to debut Monday.

Gov. Bruce Rauner’s administration will add 800,000 low-income and disabled residents to a managed care program aimed at improving efficiency, keeping people healthier and saving money.




But critics have raised sharp questions, from the manner in which the Illinois Department of Healthcare and Family Services sought and signed up insurers to whether the reimbursement rates those providers accepted are high enough to keep them viable.

Four in five of the nation’s 70 million Medicaid clients are on managed care. The idea is that by assigning patients to doctors and resources that help them focus on illness prevention, they’ll stay healthier and more readily avoid costly emergency treatment when they do get it.

Monday’s expansion, called HealthChoice Illinois, will ultimately bring to 2.7 million the number of Illinois Medicaid recipients in managed care, or about 80 percent. Those in counties that already have managed care will join the new program Monday. The rest will follow on April 1.




The four-year deal, with an option to continue for four more, will cost $60 billion for seven insurers to participate. That’s an increase of 50 percent over the current program. But Healthcare and Family Services says overall, taxpayers will save $250 million a year because the insurers under contract accepted reduced reimbursement rates in order to get a piece of the project.

Those rates are the latest worry for legislative Democrats who have been closely scrutinizing the HFS plan since it was announced late last winter.

Rep. Greg Harris of Chicago, the House Appropriations-Human Services Committee chairman, who has conducted hearings on the way the contract was awarded and the necessity of smaller, tangential contracts, has turned his attention to the program’s viability.




Harris points a warning finger to Iowa, where he contends the Medicaid managed care program is collapsing because one of three insurers pulled out Dec. 1, leaving more than 200,000 clients without an insurer and forcing a limitation on patient choice. AmeriHealth Caritas was in a prickly position because its clientele ended up being the state’s most seriously disabled. They tend to have more costly care.

But the other companies have complained about costs, too. By late December, a second insurer was refuting the rumor, mentioned by a Democratic lawmaker, that it, too, would exit the program.

The Kaiser Family Foundation reported in October that Medicaid spending grew by 4 percent in the year that ended June 30 and that state administrators project it to grow by another 5 percent this year. Kaiser says growth is fueled largely by rising costs of prescription drugs — something Harris and other Illinois Democrats have noted — and long-term care services.

Another, ironically, are increases in payment rates for provider groups.

The Illinois plan selected seven providers to deliver services in all 102 of the Prairie State’s counties. The former program operated in only 30 counties and did not cover residents in many rural areas. In Cook County, clients will choose from NextLevelHealth or CountyCare Health Plan. Outside of the metropolitan area, choices are BlueCross BlueShieldHarmonyIllinicare HealthMeridianHealth or Molina Healthcare.

HFS officials say everyone eligible is receiving “clear and detailed information to help them understand their options and make their choices.”




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