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Ballooning Medicaid program costs highlight governor’s mismanagement

MCO panel 120817 Senate committee questions $63 billion contract

CHICAGO – Illinois Senate Democrats today questioned the Rauner administration about the more than $20 billion cost increase in a plan to transition Medicaid clients to a managed care program.

“After listening to today’s committee in Chicago, there are still many unanswered questions,” State Senator Dave Koehler (D-Peoria) said following a joint committee hearing in Chicago. “Most importantly, I still do not believe the administration has clearly answered how taking all 102 counties into managed care will save money and produce positive quality outcomes without jeopardizing the health care of Illinois’ most vulnerable residents.” 

The Illinois Department of Healthcare and Family Services posted in mid-November that the program would cost $42 billion. Less than a week later, the price tag for the four-year contract was updated to $63 billion.

In addition, the contract was awarded outside of the state procurement code, and specific contracts with each managed care organization have not been publicly disclosed.

The management and rollout of the program already has come under fire. Earlier this week, the state’s chief procurement office cancelled a $12.8 million no-bid contract that the Rauner administration awarded to McKinsey & Co. to consult on the process.

With the rushed nature of the managed care rollout, some senators questioned how information is being shared by the administration with health care providers.

“I appreciate Director Norwood and her colleagues answering our questions about the managed care program so candidly and directly,” State Senator Andy Manar (D-Bunker Hill) said. “Unfortunately, much of this information has not been making its way to the hospitals and health centers in the district I represent. I talked to people just last week who still can’t get answers from HFS to basic questions about changes that are going to affect thousands of Illinois patients and health care providers.”

The Rauner administration announced in February that it would expand the mandatory managed care program in Illinois from 30 counties to all 102 counties within the next year. This would increase the total percentage of Medicaid clients enrolled in managed care from 65 percent to more than 80 percent. It also expands the program to include children in the care of the Illinois Department of Children and Family Services.

The plan was supposed to save the state between $200 million and $300 million yearly.

“It is imperative abused or neglected children in DCFS care receive mental and behavioral health services,” State Senator Julie Morrison (D-Deerfield) said. “I am concerned that already overworked DCFS case managers will now be expected to monitor the health care needs of vulnerable children.”

Senate Democrats reminded the Rauner administration that these contracts will have a real impact on the lives of millions of the most vulnerable Illinoisans.