Rauner to revamp Medicaid program in hopes of saving money, improving care

Feb. 27--Gov. Bruce Rauner on Monday announced plans to revamp the state's system for insuring many of its poorest residents, saying the changes could save taxpayers money and improve health.

But it remains uncertain how much money the overhaul might save the cash-strapped state.

About 2 million Illinois residents -- nearly two-thirds of Illinois residents on Medicaid, a state- and federally funded health insurance program for the poor and disabled -- are part of managed care plans. In Medicaid managed care, private insurers administer Medicaid benefits. The state administers benefits in traditional Medicaid plans.

Rauner plans to expand Medicare managed care programs to 80 percent of Illinois residents on Medicaid, in every county in the state as well as to children under the care of the Department of Children and Family Services. He also wants to make sure the program focuses more on coordinating care for patients and paying doctors and hospitals based on results rather than just for services -- something that has always been a goal of the program.

Former Gov. Pat Quinn signed a bill in 2011 mandating that half of all Medicaid beneficiaries be in managed care plans by 2015.

"We've done managed care in Illinois but like a lot of things we've done in state government, it's kind of in name only," Rauner said.

Rauner said the state would slash the number of insurers involved in Medicaid managed care from 12 companies to no more than seven.

Reducing the number of insurers will eliminate some of the administrative headaches the program has created for providers and ease confusion it's sowed among patients, said Felicia Norwood, director of the Illinois Department of Healthcare and Family Services. In recent months, some central Illinois hospitals have dropped out of Medicaid managed care plans, leaving Medicaid beneficiaries in some counties without options, she said.

Medicaid managed care expenditures are expected to total an estimated $10.8 billion in state and federal dollars between summer 2016 and summer 2017.

Rauner, however, said Monday he couldn't speculate on how much cash the changes might ultimately save the state, saying officials will have to see what insurers propose when they respond to a new request for proposals.

The Illinois Association of Medicaid Health Plans released a statement Monday saying it's reviewing the request for proposals and it looks forward to working on the rollout of a statewide program.

The association noted that since Illinois transitioned 2 million people into managed care programs, hospital readmissions have gone down, babies' birth weights have increased and a larger number of people are regularly seeing their primary care doctors and getting their prescription drugs on time.

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