Illinois Hospital Association President's Statement on Governor's Proposed Medicaid Cuts

NAPERVILLE, Ill., and SPRINGFIELD, Ill., Feb. 16, 2011 /PRNewswire-USNewswire/ -- Illinois Hospital Association (IHA) President Maryjane A. Wurth issued the following statement about the Governor's FY2012 state budget proposal, which includes a $552 million reduction in Medicaid funding (from a 6 percent rate reimbursement reduction) for hospitals, nursing homes, and many non-institutional providers.

"The Illinois Hospital Association and hospital community recognize that the state faces serious financial challenges and that the Governor and General Assembly must make difficult decisions in the upcoming budget process. But we are deeply concerned that the proposed cuts to the Medicaid program will have a devastating impact on the well-being of hundreds of thousands of Illinoisans and the financial stability of many hospitals across the state.

"Making such deep cuts will pose serious challenges to many financially fragile hospitals, which are already struggling to survive. With hospitals being squeezed between higher costs – for labor, new technology and medical liability – and inadequate revenues during the current economic downturn, their ability to continue to perform the critical role of serving their patients and their communities will be seriously jeopardized by Medicaid rate reductions.

"Hospitals welcome the opportunity to work with the state to reform the Medicaid program through better coordination and integration of care to improve outcomes and reduce costs. In fact, we have already made a series of recommendations to the state on ways to achieve substantial savings in the Medicaid program, such as care coordination and accountable care approaches led by hospitals. We stand ready to work with the state to pilot and test these approaches to make sure they are workable and will lead to better outcomes and lower costs. However, blunt cuts to Medicaid will undermine those efforts as well as do great harm to the health care safety net that Illinoisans rely on.

"Over the past several years, hospitals have partnered with the state on efforts to fairly fund the health care system, including paying a $900 million annual hospital tax that is bringing the state billions in additional federal funds. They are also vital economic engines in their communities, employing more than a quarter of a million people and generating an economic impact of more than $75 billion annually.

"We urge the General Assembly to reject these proposed Medicaid cuts and work with IHA and the hospital community to develop fair and reasonable approaches to save money in the Medicaid program and ensure that Illinois continues to have a strong health care system and a vibrant economy."

The Illinois Hospital Association, with offices in Naperville, Springfield, and Washington D.C., represents 200 hospitals and health systems and the patients and communities they serve. For more information, see IHA's website,

SOURCE Illinois Hospital Association