Medicaid managed care reforms signed into law

Bill aims to reduce application backlog, speed payments to providers

SHARE Medicaid managed care reforms signed into law

Gov. J.B. Pritzker speaks with reporters Monday during a news conference in Chicago after signing a Medicaid reform package into law. Behind him are House Majority Leader Greg Harris, D-Chicago, and Maria Villalon, a Medicaid recipient.

Illinois Office of Communication and Information

SPRINGFIELD — Gov. J.B. Pritzker said Monday that people applying for Medicaid benefits in Illinois will see those applications processed more quickly, and health care providers will be paid more promptly, under a comprehensive reform bill now signed into law.

“This legislation launches one of the most aggressive, cross-agency efforts in Illinois history to expand health care access and to eliminate the multiyear Medicaid backlog once and for all,” Pritzker said during a bill-signing ceremony in Chicago.

Medicaid is a publicly-funded health insurance program for low-income families, seniors and the disabled. Established in 1966, it is jointly funded by the state and federal governments and it is the largest health insurance program in Illinois, covering nearly 3 million individuals, or nearly one quarter of the state’s population.

Illinois operates its Medicaid program under what’s known as a “managed care” model. That means people who are covered by the system enroll in a plan administered by private insurance companies, known as managed care organizations, or MCOs. Those companies, in turn, are paid a flat, monthly per-person rate, which they use to pay for each person’s medical care.

In recent years, though, the Illinois program, called HealthChoice Illinois, has been plagued with a backlog of applications from individuals trying to get into the program as well as people trying to renew their coverage.

The backlog, defined as applications that have not been processed within 45 days of their submission, peaked around 121,000 cases during former Republican Gov. Bruce Rauner’s administration and now is about 95,000.

Health care providers have also complained about slow payments from the MCOs as well as high rates of claim denials.

Senate Bill 1321, which was drafted by the bipartisan Medicaid Legislative Working Group, seeks to address both of those issues.

Among other things, it requires the Illinois Department of Healthcare and Family Services to set up a new claims clearinghouse to collect and analyze data about medical bills and to adjudicate claims. That agency will also establish a dispute resolution process and will act as the arbiter in disagreements between providers and MCOs.

The new law also requires MCOs to pay claims within 30 days and to make expedited payments to providers that serve large numbers of Medicaid patients, including long-term care facilities where more than 80 percent of the patients are on Medicaid, safety net hospitals and government-owned providers.

And the bill calls for streamlining the process of determining people’s eligibility and calls for changes that will allow more Medicaid recipients to be renewed automatically.

“This legislation expands access to care,” said House Majority Leader Greg Harris, D-Chicago. “It cuts bureaucracy; it adds transparency (and) accountability to the eligibility system.”

Sen. Dave Syverson, R-Rockford, echoed that sentiment, saying, “As a result of these reforms Illinois will be able to deliver health care more seamlessly, leading to better health outcomes.”

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