Thursday, April 03, 2008

A, B, C, D, E, F, G

Gov. Rod Blagojevich’s health care plan emerged in Plan D today (we wrote about Plan C last fall). But the administration may have to develop Plans E, F and G before his desired expansions become law.

The health care plan was repeatedly denied as an executive order and even challenged in federal court, but it reappeared in the legislature and received Senate approval along partisan lines Thursday. Democrats voted “yes,” and the package includes incentives for House Democrats to support the expansions by including money for projects in their districts that the governor vetoed out of last year’s budget. But the one-time funding sources and the increased spending is likely to stall in the House, to put it nicely.

Senate Democrats announced the package would offer $530 million for member initiatives, but they would rely on so-called fund sweeps. This and previous administrations have skimmed “surplus” money from dedicated funds for such services as controlling pollution and preventing youth drug abuse. Those funds accumulate money through licensing fees and a variety of sources that are supposed to pay for the costs of regulating and operating those services (see background on fund sweeps here). The Senate package would declare some special funds off limits. They’re listed here and here.

Skeptics argue that giving the governor a $530 million “blank check” has no guarantee he actually would distribute the money for projects in their districts.

Senate Republicans renounced the plan for expanding health care when the state already is behind in reimbursing Medicaid providers and faces a budget deficit this year.

Senate Minority Leader Frank Watson of Greenville added that not all the families eligible for the program need a state subsidy. “When someone’s making $85,000 a year, a family of four, don’t they have some personal responsibilities to take care of themselves and provide for their family? Does the government have to do everything for them?” he said. “I can understand why this is a program for those in need. It’s a wonderful program, the Medicaid program, for people who are in need. But I don’t think somebody making $85,000 is necessarily someone in need.”

The sponsor, Sen. Terry Link, a Waukegan Democrat, disagreed. He said families making $85,000 can have little disposable income after paying astronomical health care costs each month. Offering state-sponsored health insurance to them could save money, he said. “If you don’t think we’re paying for it right now for the uninsured, you are. You’re paying it in premiums in your own [health insurance]. This is something that we have to do.”

State funding for the program, however, would be in jeopardy every year. Initial costs are estimated to be $43 million, but Senate Republicans estimated the cost of the program once fully implanted could reach $300 million. And there’s no dedicated funding source, argued Sen. Chris Lauzen, an Aurora Republican. But once lawmakers approve a health care program, it’d be politically difficult to cut funding in later years. So, as Link said, legislators would have to prioritize and cut where possible every single year.

Some Senate Democrats commented that the entire package was bad for the state, but they voted in support of it anyway. It is an election year, after all, and playing along now could help them negotiate for things they want in next year’s budget, which starts July 1.

To recap, the governor’s health care expansions would do the following:

  • Young adults up to age 19 who have chronic illnesses would qualify for All Kids benefits regardless of income or citizenship status.
  • Under the existing FamilyCare program, families that live in Illinois, that have been uninsured for at least a year and that fall at or below 200 percent of the federal poverty level would qualify for state-sponsored health insurance. They would pay a monthly premium based on income.
  • And all uninsured women could receive benefits under the existing Illinois Breast and Cervical Cancer Screening and Treatment program.

In summary: The plan has little chance in the House, so it’ll be interesting to see what else the governor will do to push his health care expansions into law. He’s still got 22 letters left in the alphabet.

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