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Wednesday, May 20, 2015

Illinois Hospitals Release New Analysis on Harms from Drastic Medicaid Cuts, Impact of Budget Cuts 2015/2016

from a Press Release | April 29, 2015
 Illinois Hospital Association

Illinois Hospitals Release New Analysis on Harms from Drastic Medicaid Cuts
Impact of Cuts in FY2016 by House and Senate Districts
Impact of Cuts in FY2016 by House and Senate Districts Springfield – As part of Hospital Advocacy Day at the state Capitol, the Illinois Hospital Association (IHA) today released a new analysis of the negative impact of drastic Medicaid cuts on communities across the state. IHA also announced that the boards of nearly 50 hospitals and health systems have adopted strongly worded resolutions opposing Medicaid cuts in the FY2016 state budget [which goes into effect July 1, 2015].

The analysis shows that the Governor’s proposed $750 million in Medicaid reimbursement reductions to hospitals and health systems in the FY2016 state budget would result in:
 33 Senate districts each losing at least $14 million in economic activity and 100 jobs (average of more than $48 million in lost economic activity and nearly 350 jobs in those districts);
 61 House districts each losing at least $5 million in economic activity and 35 jobs (average of more than $27 million in lost economic activity and nearly 200 jobs in those districts). 
Statewide, the total impact of the proposed Medicaid cuts would be more than 12,600 lost jobs and nearly $1.8 billion in lost economic activity.

Among the hardest hit Senate districts are the 5th and 13th in Chicago, with hospitals in those two districts sustaining $140 million in Medicaid cuts, putting nearly 2,400 jobs and more than $330 million in economic activity at risk. Hospitals in House Districts 9 and 26 in Chicago face Medicaid cuts of nearly $120 million, with more than 2,000 jobs and $280 million in economic activity at risk.

“Hospitals not only provide essential health care services in their communities, they are also major economic engines and job creators,” said Dean Harrison, Chair of the IHA Board of Trustees and President and CEO of Northwestern Memorial HealthCare. “Together, hospitals are working to transform the state’s health care delivery system for better quality, improved outcomes and lower costs. Severe Medicaid payment reductions would jeopardize the substantial progress we have made to improve health care in Illinois.”

 More than 100 hospital leaders from around Illinois are at the Capitol today, urging legislators to work with the hospital community on workable ways to avoid harmful Medicaid cuts in the FY2016 state budget. They are pointing out that hospitals have already sustained more than $1 billion in state Medicaid cuts and $1.9 billion in federal Medicare cuts over the past five years. Hospital leaders are also emphasizing any further Medicaid cuts would harm all patients and communities – not just Medicaid patients – from reductions and elimination of vital services such as obstetrics and mental health; longer waits in the ER; the loss of access to life-saving technology and treatments; and higher health care costs for working families and businesses.

 “We strongly believe there are better alternatives to these proposed FY2016 funding cuts that would result in people losing access to critically needed health care services,” said IHA President and CEO Maryjane Wurth. “We share the same goal with the General Assembly – to make the Medicaid program and the state’s health care delivery system as efficient as possible while promoting timely access to quality care with the best possible outcomes for the people of Illinois.”

To send a strong and unified message to state legislators, the boards of hospitals and health systems across the state have been adopting resolutions opposing Medicaid cuts in the FY2016 state budget and sending the resolutions to their local state senators and representatives.

The resolution adopted by the Perry Memorial Hospital Board of Directors in Princeton states:

“WHEREAS…with Perry Memorial Hospital serving as one of the largest employers in the community, employing 350 people and contributing $16.1 million annually to the local economy, and with hospitals statewide providing nearly 450,000 direct and indirect jobs and generating more than $83 billion in economic impact annually…

“WHEREAS, Medicaid provides coverage for 30.1% of the outpatients treated at Perry Memorial Hospital…

“WHEREAS, these Medicaid cuts would jeopardize access to health care services and good paying, professional jobs….

 “RESOLVED that Perry Memorial Hospital’s Board of Directors urges the Illinois General Assembly to oppose and reject the Governor’s proposed Medicaid funding cuts to hospitals; and be it
FURTHER RESOLVED that the General Assembly consider and enact workable and reasonable alternatives to Medicaid cuts and work with the hospital community and the Illinois Hospital Association on these alternatives.”


Impact of Medicaid Cuts by Senate District http://www.ihatoday.org/uploadDocs/1/medicaidimpactsillinoissenate.pdf 
Impact of Medicaid Cuts by House District http://www.ihatoday.org/uploadDocs/1/medicaidimpactsillinoishouse.pdf
List of Hospitals Adopting Board Resolutions Opposing Drastic Medicaid Cuts http://www.ihatoday.org/Advocacy/Hospital-Boards.aspx
News Stories on Hospital Board Resolutions

 Notes: Analysis is based on the Governor's introduced FY 2016 budget. Includes elimination of all supplemental payments (including rate reform transitional payments), elimination of safety-net and children’s psychiatric add-on payments, and a uniform reduction in hospital assessment payments.

Estimates are based on the Regional Input-Output Modeling System II (RIMS-II) developed by the U.S. Bureau of Economic Analysis (BEA). The Final Demand multipliers, obtained from BEA RIMS-II, were applied to the Medicaid cut to obtain the “ripple effect” of jobs and spending at risk throughout the state.

The analysis does not include the impact of an additional FY2016 budget reduction proposed by the Governor – the elimination of $60 million in care coordination fees for Medicaid Accountable Care Entities and Care Coordination Entities, which include more than 80 hospitals in Illinois.

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About IHA
The Illinois Hospital Association, with offices in Naperville, Springfield and Washington, D.C., advocates for Illinois' more than 200 hospitals and nearly 50 health systems as they serve their patients and communities. IHA members provide a broad range of services – not just within their walls, but across the continuum of health care and in their communities. Reflecting the diversity of the state, IHA members consist of nonprofit, investor-owned, and public hospitals in the following categories: community, safety net, rural, critical access, specialty, and teaching hospitals, including academic medical centers.
For more information, see www.ihatoday.org. Like IHA on Facebook. Follow IHA on Twitter.


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