Another pressure point in the Springfield stalemate was relieved Thursday when a federal judge ruled that payments owed to many Cook County health care providers who serve the poor must be made despite the absence of a state budget.
The ruling opens the spigot for much of an estimated $8 billion in state taxpayer contributions to the Medicaid program to go out without delay while Republican Gov. Bruce Rauner and Democrats who control the General Assembly remain locked in a political fight that has stalled agreement on a spending plan for the budget year that began July 1.
The Rauner administration had resisted making the payments, sending a letter asking Medicaid providers to continue to offer care during the budget impasse and wait for reimbursement until after a deal is reached.
Advocates for Medicaid recipients took the matter to the federal court in Chicago, and on Thursday U.S. District Judge Joan Lefkow ordered the state to pay the bills.
Lefkow’s ruling draws on a 2005 court order that requires the Illinois Medicaid program, which combines state and federal dollars to pay for medical care for the poor and their children, to provide children in Cook County with access to health care that meets the standards of the federal Medicaid Act.
The Sargent Shriver National Center on Poverty Law and the AIDS Legal Council of Chicago, which brought the case on behalf of Cook County kids, argued that withholding the money could force providers to shut down or limit care, which would effectively deny care to children covered under the 2005 order.
Details were still being worked out Thursday, but Shriver Center president John Bouman said it was likely to cover only providers who serve children. That means hospitals, doctors and clinics with kids and adults as patients would be paid for all the services they provide, including health care for adults, but adult-only providers like nursing homes could be left waiting for payments.
“The court’s order today averts a disastrous loss of access to care that the children would have suffered,” Bouman said in a statement. “Now poor children and other Medicaid beneficiaries will be able to get the healthcare they need, even as Illinois officials continue to fail to arrive at a state budget.”
Among the providers most affected by the ruling are Cook County’s 16 safety-net hospitals — including two children’s hospitals — which see many of the region’s poorest patients and depend on Medicaid money.
Timothy Egan, CEO of South Side safety-net Roseland Community Hospital, said before the ruling that the hospital would have been forced to close if the payments did not come. Now he’s cautiously optimistic. “As soon as the money’s in the bank, then we’ll know that this is successful,” he said.
About 71 percent of Roseland’s revenue comes from Medicaid, according to court filings.
To qualify as a safety net, Illinois hospitals need to see a disproportionate share of low-income and Medicaid patients, according to the Department of Healthcare and Family Services, which administers Medicaid.
The effect of the ruling could extend beyond Cook. In the past, the state has applied similar rulings to Illinois’ other 101 counties, Bouman said. The Rauner administration was noncommittal about whether it will authorize the payments statewide.
“The department is reviewing the order and will respond accordingly,” John Hoffman, a spokesman for the Illinois Department of Healthcare and Family Services, said in an email statement. “In the long run, the General Assembly needs to pass a balanced budget.”
The ruling was applauded by Illinois Hospital Association President Maryjane Wurth, who said the payments “should not be a bargaining chip in the budget debates in Springfield.”
It is the second time this month that a court has intervened to allow huge portions of the state’s general revenue fund to be paid out even though no budget exists authorizing the state to spend the money. A judge in St. Clair County, near St. Louis, ruled that state workers should be paid in full during the budget impasse to avoid running afoul of collective bargaining agreements.
That ruling came as Illinois Comptroller Leslie Munger, a Rauner appointee, pressed for court approval to issue paychecks to workers. Munger spokesman Rich Carter said the office would process the Medicaid payments as ordered Thursday.
