Friday, May 25, 2012

What's been done? What's yet to come?

By Jamey Dunn

The Illinois General Assembly approved historic changes to the state’s Medicaid system this week. But with six days left until the spring legislative session is scheduled to adjourn, lawmakers still have plenty to do.

Both chambers approved Senate Bill 2840 on Thursday. The measure contains reductions to Medicaid services. While lawmakers said they tried to avoid ending programs altogether, the plan would eliminate the Illinois Cares Rx program, which helps low-income seniors pay for medicine, and dental care for adults, except for in emergency situations. The legislation also includes cuts to the rates some hospitals and health care professionals are paid for providing Medicaid services.

Both chambers signed off on House Bill 5007, which will allow Cook County to put more people on its Medicaid rolls. The expansion would come at no cost to downstate taxpayers and would allow the county to recoup federal matching dollars for thousands of patients who are currently being treated at county hospitals.

The House today approved a cigarette tax that is a key piece of the overall Medicaid reform plan. The Senate has yet to take up the bill.

Neither chamber has taken a vote on SB 3397, which would prevent the state from pushing Medicaid bills off into future fiscal years.

The Senate Democrats approved a budget plan without Republican support in their chamber. But some predict that it will likely be ignored by the House, much like the Democrats budget was last year. “It’s … a chamber squabble for you folks. It’s to beat the House of Representatives. And here’s what’s going to happen: You’re going to go through all this turmoil over here and all this grief,” Sen. Dale Righter, a Republican from Mattoon, said during floor debate of the bills. “And what’s going to happen is, these budget bills are going to zoom over to the House of Representatives, and they will meet exactly the same demise as your budget did last year.”

The Senate Democrats’ bills are all currently scheduled for a hearing in the House Executive committee on May 31, the last day of the scheduled session.

Some pieces of the House’s budget have emerged, and they contain cuts that are sure to be unpopular. Senate Bill 2413, which was discussed in a House budgeting committee this morning, would cut $25 million from early education programs and reduce funding for children’s mental health programs from $1.6 million  to $300,000.

Ireta Gasner, senior policy associate for the Ounce Of Prevention Fund, estimated that the proposed early childhood cut would mean that more than 25, 000 children would lose the chance to go to preschool. She said that under the cut, early childhood programs would have been cut by a total of $80 million over the last four years. She said cuts to early childhood programs lead to greater spending elsewhere in future budgets because children who do not receive preschool are more likely to need other state services down the road. “We have to be clear that any savings we think we’re realizing from this $80 million in cuts is only going to come back in real costs to children and to our taxpayers in the near future and in the long term.”

Senate Democrats say their plan would not cut spending or K-12 education. Chicago Democratic Rep. Deborah Mell, who serves on the House’s K-12 budgeting committee, said that she hopes the House will consider some aspects of the Senate Democrats’ proposal.

SB 2443, which a House budgeting committee approved this evening, would cut higher education by just over 6 percent. The Senate plan would cut higher education by between 3 percent and 4 percent.

Gov. Pat Quinn's budget proposal called for no cuts to higher education or K-12. In fact, he pitched a $20 million increase for early childhood education and a $50 million increase for Monetary Award Program (MAP) grants for college students.

A proposal to reduce retirement benefits for state workers may emerge in the coming days. House Speaker Michael Madigan has hinted on what that plan could look like. He told the Illinois Channel yesterday that the bill would likely eliminate compounding interest cost-of-living adjustments and replace them with an adjustment of 3 percent or half the rate of inflation, whichever is less. Madigan said the plan would not require workers to pay more for their retirement or wait longer to be eligible for full benefits. Quinn's proposal included both an increase in employee contributions and the retirement age.

“We’ve made good progress. We’re concerned with the fiscal security of the pension systems, and we’ve determined that the biggest cost driver that leads to fiscal instability in the pension systems is the automatic compounded [cost-of-living adjustment],” Madigan said. “So our view is that should be adjusted. … There are other elements to the program. But we’re not going to call on employees to make additional contributions. We’re not going to change the retirement age. But we do feel that local school districts and community colleges and universities ought to assume the responsibility to make the pension payments for their employees.” Madigan said the cost shift would be done gradually. He said that he thinks lawmakers can send a plan to Quinn before adjournment.

“I don’t know. He may have an agreement with the unions by the end of the day,” House Minority Leader Tom Cross said this afternoon. Cross said that he has not been in on negotiations with unions. He said he plans to meet with Madigan on Saturday to discuss the issue. “This thing, I think, is still evolving. …We certainly will have a little better approach to it after tomorrow, a little better feel for it.”

Republicans have voiced opposition to the idea of shifting costs to school districts, universities and community colleges. “I’ve never been a big fan of the cost shift,” Cross said. But he would not say if he would oppose such a shift, saying that he wanted to see the whole proposal before ruling out any one idea.

Cross said that the current compounded cost-of-living increases are “not sustainable” and that they are a good place to look for cutting costs. “The key is, how do you find the most significant savings that’s constitutional. Whatever you do in this exercise, you’re going to make somebody very, very mad. But [when] we go back to the bottom line, we’ve got an $85 billion unfunded liability,” Cross said.

The House is scheduled for session Saturday morning, but not Sunday. The Senate is taking the weekend off. Both chambers are scheduled to be back in session on Monday.


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