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* The Tribune editorial board may be finally starting to catch on to the Springfield game…

Gov. Pat Quinn’splan to scale back the state’s ailing Medicaid program is running into Republican resistance, primarily because Quinn’s mix includes a $1-a-pack cigarette tax hike.

“We’re looking for money rather than looking at the spending side, and it’s that default position that has gotten us exactly into the mess we’re in,” Republican Senate Minority Leader Christine Radogno told a City Club of Chicago audience Monday.

Fair enough. We’ve pushed as hard as anyone for Illinois to curb its vicious spending habit, which has left the state billions of dollars in debt and incapable of paying its bills.

But we strongly encourage Republicans to be flexible here, lest we lose the momentum for Medicaid reform (as well as pension reform). If these changes are going to happen, they’re going to be done in a bipartisan fashion. They’re going to need Republican votes. Quinn has proposed substantial cuts in spending on Medicaid, and he’s going to run into some Democratic resistance on that. […]

Illinois has a crisis: an expected $1.9 billion in unpaid Medicaid bills on hand by June 30, the end of fiscal 2012. Without a fix, that backlog will surge to $21 billion in five years. Providers wait about four months now to get paid; that delay could stretch to a full year. That puts a huge financial burden on the providers. Longer delays and steeper reimbursement rates could push more of them to stop treating Medicaid patients.

We credit Quinn for stepping up here, taking the political risk of proposing Medicaid and pension reform. His plan isn’t the last word, but it does set a solid framework.

This reform can’t wait. If Republicans have better ideas, bring ‘em on soon. And negotiate in good faith.

* But Gov. Pat Quinn is using the very same sort of argument on gaming that the Senate Republicans have used on Medicaid…

Quinn said gambling expansion, including slot machines at horse racing tracks, should not become a political distraction in the remaining six weeks of session for the General Assembly, because Medicaid and pension stabilization are “the highest priorities we can possibly focus on.”

The Chicago Democrat criticized lawmakers on both sides of the aisle pushing gambling expansion as “some … who frankly don’t want to deal with the hard things. They say the solution would be expanded gambling and we don’t have to make hard choices.”

Using revenues from the cigarette tax hike to avoid “hard choices” on Medicaid is pretty much exactly what the SGOPs are saying.

* And, like the cigarette tax hike, gaming expansion is no big deal to the public…

More than 60 percent of Illinois residents support a gaming solution that includes more casinos and the addition of slot machines at racetracks as a solution to create more than 20,000 jobs and generate nearly $200 million annually for the state, a newly released poll reveals.

Most Illinoisans support the gambling expansion bill Gov. Pat Quinn vetoed this year — at least according to a poll taken on behalf of the people who would most benefit from more gambling in Illinois.

The poll was conducted for the Illinois Revenue & Jobs Alliance, which describes itself as “a growing statewide consortium of labor organizations, business groups, farming and agribusiness interests, racetracks and horsemen associations, and local municipalities committed to the passage of SB 1849 which calls for the expansion of gaming in Illinois, including slot machines at racetracks.”

* And then there’s the whole idea of not allowing a few decades-old gambling establishments (racetracks) to offer more gambling…

“This is the same governor who has approved buying lottery tickets at home on your computer. So 10-13 million Illinoisians apparently can gamble on their computer at home, but a few people can’t go to a race track and gamble where they’re already gambling? I think that’s a very difficult stretch,” Lang said.

* But unlike gaming expansion, Quinn says he is open to some changes to his Medicaid plan…

Gov. Pat Quinn laid out his plan to cover a $2.7 billion Medicaid hole last week, proposing a cigarette tax hike, cuts in rates paid to Medicaid providers and reductions in services to Medicaid recipients.

However, administration officials acknowledged that components could change as lawmakers debate the plan in the coming weeks.

That comes as a working group of state lawmakers still wants to develop its own plan for closing the gap, a plan Republicans hope will avoid the tax increase and the rate reductions.

Quinn’s vision for closing the $2.7 billion gap is not etched in stone, according to his top aides.

* In other Medicaid news, Crain’s has a new story entitled “Medicaid plan would shift $250 million tab to private insurers”…

The Quinn administration’s proposal to force health insurance companies to shoulder a greater share of the cost for treating severely sick children might save the state $250 million a year, but it likely will drive up premiums on policyholders.

Reducing Medicaid spending on children with “special health care needs” — ranging from cystic fibrosis and sickle cell disease to chronic pain and depression — is a key part of Gov. Pat Quinn’s plan to cut spending by $2 billion a year for the federal-state health insurance program for the poor… The idea of shifting Medicaid costs onto private insurers is novel

* But here’s the actual explanation…

Under a quirk in Illinois eligibility requirements, children and their families whose income is low enough to qualify for Medicaid can participate in the program, even if they have private insurance. […]

Those nearly 35,000 children cost the state on average about $12,700 in 2009, according to an analysis by [Children’s Memorial Hospital] that Ms. Hamos provided to Crain’s.

The department projects it can save about $250 million a year if private carriers cover the first $36,000 in costs for only an estimated 7,000 children, with Medicaid picking up the rest of the tab. That’s the starting point for the state.

So, couldn’t that $250 million a year also be looked at as a state government subsidy of the health insurance industry?

* Meanwhile…

A national liberal advocacy group is criticizing Illinois’ Democratic governor’s proposed solution to the state’s Medicaid crisis.

Families USA is issuing a new report Wednesday that estimates job losses of more than 25,000 if Illinois cuts Medicaid spending by $2.7 billion.

So far, Quinn hasn’t really proposed cutting Medicaid spending by $2.7 billion because about $700 million of that amount would be from a cigarette tax hike combined with a federal match. The full report is here.

* And the Belleville News-Democrat has demanded deep state budget cuts in the past, but it doesn’t much care for a proposed local facility closure…

State officials say Gov. Pat Quinn’s plan to close the Murray Center in Centralia is a policy decision, but come on. Everybody knows the center is on the chopping block now because the state is billions of dollars in debt.

Understandably, people who have family and friends who live or work there don’t want the facility to close. But that can’t be the governor’s basis for the decision. As someone at a recent hearing on the proposed closure correctly pointed out, if that were the criteria, no state facility would ever be closed.

The state has to cut from somewhere, but is this a good place? There are many more straightforward savings to be had than Murray Center.

For example, the state could save about $13.5 million annually by eliminating the legislative scholarship program — about what would be saved annually by closing the Murray Center.

They had other budget ideas as well, but that $13.5 million is fantasy cash. The scholarships aren’t actually funded with any state money. They’re really just tuition waivers.

* Related and a roundup…

* Quinn defends proposal to raise cigarette taxes for health care

* Rep. Brady: Cigarette tax ‘not realistic’

* Illinois Residents Say They Want A Casino

* More on hospitals’ Medicaid ideas: A commenter on the Capitol Fax blog noted, correctly, that if the state kicks a lot more people off the Medicaid rolls, it ultimately would cost the hospitals, which provide 40 percent of Medicaid-reimbursed services. This is a point the Illinois Hospital Association made to the SJ-R editorial board last week. Space limits prevented me from more fully explaining this in the editorial itself, so I thought a little explanation here is in order.

* Added bus costs concern local schools

* Lawmaker: College Illinois! audit reveals no surprises

* Legislation would ban ‘tax zappers’

* New attorneys to fight unemployment benefits fraud

* IL moves to boot 2 school boards from office

* Historic schools, farmstead, city hall on IL endangered list

* Illinois Sets Funds to Alleviate No. 1 Trucking Bottleneck

* ComEd ready to install 4 million smart meters in IL

posted by Rich Miller
Wednesday, Apr 25, 12 @ 10:47 am

Comments

==So, couldn’t that $250 million a year also be looked at as a state government subsidy of the health insurance industry?==
Yes, absolutely, good point! And this $250 million should really be added to the $700 million cigarette tax hike, meaning “just” $1.75 billion in Medicaid cuts needed. We could get that number down even further if Gov. Quinn would allow gambling expansion.

Comment by Robert Wednesday, Apr 25, 12 @ 10:55 am
===That $13.5 million is fantasy cash. The scholarships aren’t actually funded with any state money. They’re really just tuition waivers.===
True, but if universities aren’t needing to lose $13.5 million in legislature-forced tuition waivers, the legislature should cut universities’ funding by that same $13.5 million to make it a net zero for the universities.

Comment by Robert Wednesday, Apr 25, 12 @ 10:57 am
–True, but if universities aren’t needing to lose $13.5 million in legislature-forced tuition waivers, the legislature should cut universities’ funding by that same $13.5 million to make it a net zero for the universities. –

Huh?

Comment by wordslinger Wednesday, Apr 25, 12 @ 11:10 am
A. The Universities don’t lose a dime they just stuff mre bodies in the room.
B. Maybe the medicaid.casino, tobacco folks can get together and develop a plan that solves a lot o problems with minimal pain…..hmm

Comment by CircularFiringSquad Wednesday, Apr 25, 12 @ 11:16 am
Why do the Governor and the Democrats need Republican votes for the tax increase?

Comment by Confused Wednesday, Apr 25, 12 @ 11:17 am
I’m not sure what you are referring to when you refer to Illinois’ vicious spending habit.

Illinois is in last place among the 50 states in the number of state employees per capita.

Illinois is in the bottom five of all 50 states in state expenditures per capita.

Illinois is dead last among our neighboring states in total state expenditures per capita.

Total state expenditures per capita
Illinois: $3599
Wisconsin: $6798
Iowa: $5810
Missouri $3857
Kentucky: $5576
Indiana $4004

Comment by Joe Melugins Wednesday, Apr 25, 12 @ 11:31 am
===True, but if universities aren’t needing to lose $13.5 million in legislature-forced tuition waivers, the legislature should cut universities’ funding by that same $13.5 million to make it a net zero for the universities.===
-Huh?-
The legislature currently forces universities to give cash scholarships totaling approx. $13.5 million per year to the politically connected, which costs universities $13.5 million today. If the legislature stops this, the legislature could also cut $13.5 million in funding from universities. If they do both these things, universities would be no worse off, since they’d be able to, if they chose, charge full tuition to replace the forced legislative scholarship giveaway. If the legislature only eliminates the legislative scholarship, it is like giving universities $13.5 million in extra funding.

Comment by Robert Wednesday, Apr 25, 12 @ 11:45 am
Robert, there is no $13.5 million. The universities just pile the tuition waiver kids into the classes.

Comment by wordslinger Wednesday, Apr 25, 12 @ 11:52 am
Our universities cover the expenses of the students attending on a waiver, to the tune of $13.5 million per year.

If those students:
A. begin paying their own way
or
B. do not receive a legislative “scholarship”

then that is $13.5 in additional revenue or savings for our universities.

Reduce General Revenue funds to those universities by $13.5 million and put it towards something else.

That’s as “real” as it gets under GAAP accounting rules.

Comment by Freeman Wednesday, Apr 25, 12 @ 12:13 pm
wordslinger - but that’s the universities’ choice. They really have 4 options if the tuition waiver is eliminated.

1) The tuition waiver kids now pay tuition, meaning the universities get $13.5 million in more tuition revenue, no change to class size from today.
2) Replace any tuition waiver kids with fully paying students, meaning the universities get $13.5 million in more tuition, no change to class size from today.
3) Replace the tuition waiver kids with need-based aid - that’s certainly an option.
4) Don’t replace the tuition waiver kids and shrink class size slightly.

If universities pick #1 or #2, their finances ultimately would be unchanged if legislature cut $13.5 million. If they pick #3 or #4, they’d take a hit but at least that’s their choice.

In any event, we’re arguing about peanuts here. $13.5 million in savings would be of course just $0.01 Billion in less savings the legislature needs to squeeze out of Medicaid.

Comment by Robert Wednesday, Apr 25, 12 @ 12:14 pm
And if there is no real cost to universities affiliated with the legislative scholarship program, then let’s expand it. Aggresively.

The more Illinois kids in school, the better - even with the questionable history of the program.

“Free” legislative scholarships for all.

Comment by Freeman Wednesday, Apr 25, 12 @ 12:16 pm
Rich -

Excellent round-up.

Someone once said “Hypocrisy is the vaseline of social intercourse.”

Turns out its also the birth control of public policymaking.

Comment by Yellow Dog Democrat Wednesday, Apr 25, 12 @ 12:26 pm
So we are looking for ways to balance the budget. That means decreasing spending and/or increasing revenue. I don’t know if anyone here has heard, but there’s a way to do both of those things at once. While it won’t solve the problem on its own, it would help make some breathing room.

Legalize marijuana.

We’re arguing over a phantom $13.5M in legislative scholarships, while we’re paying $17M/year just to incarcerate marijuana convicts. That doesn’t include the police or prosecutors, just the incarceration costs. (http://www.illinoistimes.com/Springfield/article-9633-the-war-on-weed.html)

Why spend all that money pursuing, prosecuting and incarcerating individuals in the meantime when we could be collecting taxes on a product that is proven safer than existing legal products?

Sorry to be “that guy” today, but seriously, it HAS to be said, because it’s a commonsense step to alleviating some of our budget problems. Without people forcing this option onto the table, it will continue to be treated as the sole provenance of whackjobs and stoners. This is going to happen at some point in the future - anyone with a cursory knowledge of the issue has to be aware that 30 years from now marijuana will be legal.
Legalize it.

Sorry to be “that guy” today, but seriously, it HAS to be said, because it’s a commonsense step to alleviating some of our budget problems. Without people forcing this option onto the table, it will continue to be treated as the sole provenance of whackjobs and stoners.

Comment by Colossus Wednesday, Apr 25, 12 @ 12:42 pm
Grrr…copy and paste errors. I thought I had cleaned it up, but now I look like a whackjob or stoner. Sigh.

Rich, can we get a bigger box for review on the comments?

Comment by Colossus Wednesday, Apr 25, 12 @ 12:44 pm
== Why do the Governor and the Democrats need Republican votes for the tax increase? ==
Every tax increase under Governors Ogilvie, Thompson, Edgar and Ryan were bipartisan. That prevented them from becoming political footballs in the next election. Democrats didn’t say “let the Republicans pass the tax hikes if they want them so badly.”

Comment by reformer Wednesday, Apr 25, 12 @ 1:59 pm
Passing license to carry legislation would also generate a significant amount of funding and likely result in greater safety of Illinois residents. It is financially beneficial, the law enforcement associations are on record in support, and yet it hasn’t happened… Lots of low hanging fruit that could yield real benefits that many are ignoring.

Comment by Logic not emotion Wednesday, Apr 25, 12 @ 9:34 pm