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The $165 million LIHEAP skim

Monday, Feb 23, 2015

* Illinois utility ratepayers pay an extra surcharge on their monthly bills to help pay for energy assistance for the poor, like their heating bills. And last week, during one of the coldest weeks of the year, Gov. Rauner proposed taking that utility surcharge money and using it for the General Revenue Fund

Trouble is, Rauner can’t just grab the money. State law requires utilities like Commonwealth Edison, Nicor Gas and Peoples Gas, which collect the funds, to use them for the intended purposes or reimburse ratepayers. So Rauner will need a change in those laws to shift the utility-collected funds to the state’s general fund. A spokeswoman confirms he will propose just such a change. […]

Striking in any case is the fact that an Illinois governor has proposed, in effect, to transform utility-bill payments aimed at helping the most disadvantaged into a state tax stream.

The Low-Income Home Energy Assistance Program, or LIHEAP, is a federally funded pool of money that in Illinois generally is distributed each winter to needy households to keep current on their bills and prevent gas shutoffs when April comes around. The funds generated through the utility surcharges add another 50 percent to the money available when combined with the federal allocation. For Illinoisans in the current fiscal year, the utility surcharges for LIHEAP generated $165 million, according to the governor’s budget document.

The LIHEAP changes Rauner proposes affect only the state’s contribution to that program, not the $330 million that Illinois gets from the federal government for low-income heating help.

“To close a $6 billion budget deficit and address years of fiscal mismanagement, the governor’s budget brings Illinois in line with 20 other states that use only federal dollars to fund the program,” a Rauner spokeswoman says in a statement. “Illinois households that need help paying utility bills will continue receiving subsidies. As in the past, the state will work to make sure that subsidies go to those most in need.”


- Posted by Rich Miller   125 Comments      

Question of the day

Monday, Feb 23, 2015

* Finke

The scary thing is that some people are already getting nervous about an extended legislative session this year.

It is supposed to conclude by the end of May, as usual, but lawmakers are already wondering if the stage is being set for a protracted session that could drag out for much of the summer.

“We could see a revisit of 2004, when we were here all summer long trying to hash these things out,” said Rep. ELAINE NEKRITZ, D-Northbrook, after the budget speech last week. […]

While many Democrats favor increased taxes to help ease the need for budget cuts, Rauner has said he wants no new revenues. Nekritz said she doesn’t see a tax hike passing with only Democratic votes. If Republicans won’t support more revenue and all the budget balancing has to come from cuts, look out.

That 2004 session was brutal and didn’t end until Democrats started to worry that they could overshadow US Sen. Obama’s keynote address at the Democratic National Convention.

Of course, the 2007 and 2008 overtimes were even worse.

* Peoria Journal Star

Last week at the Peoria County Democrats’ Presidents Day Dinner, state Sen. Dave Koehler suggested he and wife Nora weren’t planning on any vacations during the summer, given some of the fights that could be brewing in Springfield, especially over right-to-work zones that Rauner has proposed.

Immediately after the governor’s budget address, state Rep. David Leitch, R-Peoria, made the same prediction, albeit for different reasons.

With Rauner proposing to slay — or at least hobble — so many sacred budgetary cows in order to get Illinois government back to spending what it can afford to spend, so many different people have different reasons to be obstructionist. That includes legislators, lobbyists and state employees.

Drawn-out negotiations will not be a surprise, along with some heated language, both in public and behind closed doors. Although to their credit, Rauner and legislative leaders have been so far restrained and respectful. That signals this won’t be another Blagojevich-like breakdown in communications.

* The Question: Do you think the legislative session will go into overtime this year? Take the poll and then explain your answer in comments, please.

feedback surveys

- Posted by Rich Miller   110 Comments      

Docs say they’ve come up with “comprehensive” prescription abuse plan

Monday, Feb 23, 2015

* From a press release…

The Illinois State Medical Society (ISMS) released a comprehensive plan today to address the misuse and abuse of powerful opioid prescription medications. Due to their high potential for addiction, opioids are classified as Schedule II drugs. ISMS developed the report, Recommendations for Deterring Improper Use of Opioids, for the Illinois House Task Force on the Heroin Crisis, chaired by House Democratic Majority Leader Lou Lang (D-Skokie), as a framework for Illinois legislation.

Illinois physicians suggest taking a pro-active approach to maintain our state’s good standing in the appropriate prescribing of opioid medications. Illinois’ low rate of oxycodone prescribing exemplifies physicians’ cautious use of a powerful medication. Of the total oxycodone prescriptions issued nationwide in 2013, Illinois had a per capita use of only .05, ranking 50th in the United States. By contrast, Tennessee had over six times as much utilization of oxycodone per capita, ranking at third in the nation with a .31 utilization rate per capita.

* Full details are here. A few of the dot points…

· Expanding and strengthening Illinois’ Prescription Monitoring Program (PMP), a statewide data base that prescribers can check to prevent “doctor shopping.”

    The PMP is a valuable resource for prescribers to identify patients seeking medication for illicit use. ISMS has identified several strategies to expand the PMP’s use and effectiveness.

Presenting new opportunities for continuing medical education for opioid prescribers.

    ISMS supports increasing prescribers’ access to educational opportunities and information by developing the PMP as a vehicle for sharing such material.

Increasing access to naloxone, a medication used to counteract opioid and heroin overdose.

    Several Illinois communities have initiated programs to promote naloxone availability; however, it is not readily available without prescription in most areas. Illinois must make naloxone more accessible to law enforcement, family members of at-risk patients and other first responders.

Promoting safe medication disposal sites.

    Opioid abusers commonly obtain medication from a friend or family member’s medicine cabinet. Expanding patient education and options for medication disposal will help keep addictive medications out of abusers’ hands.

Most are just common sense. I’m not sure how effective this plan will be. I don’t see any penalties for docs. Your thoughts?

* Somewhat related…

* Docs in the medical pot business can’t recommend their patients to use it

- Posted by Rich Miller   15 Comments      

A look at some of the governor’s proposed Medicaid cuts

Monday, Feb 23, 2015

* The AP looks at the governor’s proposed $1.5 billion Medicaid cut

(H)ospitals are a main target, shouldering $735 million in payment cuts — a 13 percent reduction, according to the Illinois Hospital Association. That may prove difficult to accomplish. Hospitals are major employers in many districts and the association will tell lawmakers the statewide economic impact of cuts would equate to 12,591 jobs lost.

The association’s political action committee contributes to candidates of both parties, giving $463,055 last year in Illinois races, including $150,000 to Pat Quinn’s losing campaign. […]

“There will be difficult discussions,” predicted Rep. Patti Bellock, a Hinsdale Republican who helped lead a bipartisan panel that hammered out the Medicaid cuts passed in 2012 known as the SMART Act. “There are a lot of districts where hospitals are extremely important. I consider them the backbone of our communities.” […]

The proposed payment cut to hospitals is nearly three times what the facilities lost in funding in 2012, said A.J. Wilhelmi of the Illinois Hospital Association. He warned of unintended consequences. “When you cut Medicaid, there’s a cost shift to the private insurance market and therefore middle-class families will pay more,” Wilhelmi said.

Rauner’s budget would cut $216 million from nursing homes (a SMART Act restoration) and save $40 million by ending a fee to pharmacies for dispensing brand-name drugs.

* Tribune

The Illinois Hospital Association estimated that the cuts would result in 12,591 lost jobs and $1.75 billion in lost economic activity in the state.

Those most affected are hospitals that serve large numbers of Medicaid patients, Illinois Hospital Association spokesman Danny Chun said.

Norwegian American Hospital CEO Jose Sanchez said the majority of its almost entirely Hispanic and African-American patient-base in the Humboldt Park neighborhood rely on Medicaid for health insurance.

“If all of these cuts got through, it will have a devastating impact on the hospital,” Sanchez said. “We are 55 percent Medicaid.”


“There is no cost savings” to excluding adult dental care from Medicaid, said Dave Marsh of the Illinois State Dental Society. “It’s minuscule. But the pain and suffering of the population who would be affected by this is staggering.”

“There is a connection between the mouth and the rest of the body,” said Dr. Bruce Rotter, dean of the SIU School of Dental Medicine. “Approximately a third to a half of adult patients have periodontal disease.”

- Posted by Rich Miller   45 Comments      

Rauner’s punt

Monday, Feb 23, 2015

* My weekly syndicated newspaper column

After he was elected, but before he was sworn in to office, Bruce Rauner repeatedly lambasted Gov. Pat Quinn and the legislative Democrats for passing a “booby trap” budget that was about to blow up in the state’s collective face.

Rauner was absolutely right. Last year’s budget was irresponsible and didn’t deal with the reality of the expiring income tax hike. As a result, the state’s budget is in a terribly deep hole right now.

But did Gov. Rauner really make all the “tough choices” necessary to get us out of that hole during his budget address as he promised? Well, he sure proposed a lot of cuts. But he planted at least one major booby trap himself.

As you may already know, Rauner proposed a pension reform plan that he says would save at least $2.2 billion in the first year.

Set aside the fact that both Rep. Elaine Nekritz and Sen. Daniel Biss, who both worked very hard on the Legislature’s pension reform law, cannot fathom how Rauner’s proposal to move every state employee and public school teacher into the lower-cost “Tier Two” pension plan on July 1 will actually save that much money in the first year, or “immediately” knock $25 billion off the state’s massive unfunded liability. Let’s just take him at his word on this one, as supremely difficult as that likely is.

The problem with the plan is that he’s counting on that $2.2 billion “savings” to help balance the budget next fiscal year. All those who believe that a judge won’t almost immediately stop the plan’s implementation, as another judge did to the last pension reform law, please raise their hands.



I didn’t think so.

There is no way on God’s green Earth that the state can rely on that $2.2 billion savings next fiscal year. It’s a complete and utter fantasy, which makes this yet another dishonest budget.

House Speaker Michael Madigan called the idea “reckless” after the governor’s budget address.

Madigan’s right, but his counterproposal wasn’t a solution, either.

Madigan resurrected the idea of a 3 percentage point tax on personal income above a million dollars. But, at most, Madigan’s proposal would only raise a billion dollars a year. The deficit is nine times that amount.

And then there’s the problem of implementation. Madigan’s spokesman reaffirmed that the proposal can’t be put into place without first winning the approval of voters via a constitutional amendment referendum. But that can’t be done for almost two years. The idea has zero worth for next fiscal year’s budget, which begins on July 1.

OK, back to Rauner. During and after the campaign, Rauner said Quinn and the Democrats had constantly “kicked the can” down the road. Again, he was right. This fiscal year’s budget plan moved spending off budget, which created gigantic holes in next fiscal year’s budget.

But Rauner did the exact same thing last week with employee group health insurance. The state’s backlog is about a billion dollars. Some providers aren’t being paid for a year. But Rauner would increase that backlog by up to $700 million by cutting the money spent on health insurance next fiscal year and not dealing with projected cost increases. His “savings” are completely illusory.

Ironically enough, the governor visited a Hormel Foods plant the day after delivering his budget address. No word on whether he kicked a can of Spam down the hallway while he was there.

And then there’s the myriad smallish savings he derives from eliminating tiny programs that benefit some of the most vulnerable people in Illinois. Homeless youth services will be eliminated, for example. And at a time when heroin use is skyrocketing, Rauner proposes to cut the state’s treatment program.

The state eliminated Medicaid funding for dental services a few years ago. It was restored when Democrats, with plenty of evidence, claimed the cut was actually leading to higher costs elsewhere in the Medicaid budget. Rauner wants to eliminate it again.

The bottom line here is that no matter whatever else you read or hear, this budget is neither honest nor real.

It’s instead a too-clever-by-half concoction of budgetary magic beans.

After two years of avoiding any sort of detailed questions about his budget plans while on the campaign trail, Rauner basically punted the entire budget to the General Assembly last week. And it’s difficult to have much confidence in those particular folks after how badly they screwed up this year’s budget.

- Posted by Rich Miller   184 Comments      

* SUBSCRIBERS ONLY - Tonight's edition of Capitol Fax (use all CAPS in password)
* Reader comments closed for the holiday weekend
* Sen. Connelly concedes
* Question of the day
* GOMB: State needs another $3+ billion a year to stay even
* Raoul announces transition committee
* *** UPDATED x1 *** The Democrats' vote-by-mail juggernaut
* Why the Firearms Restraining Order Act is so important
* Pension benefits are not cut in the abstract
* The way forward
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