CHICAGO – Illinois Department of Healthcare and Family Services Director Barry Maram today addressed national civic leaders and healthcare officials on Illinois’ healthcare achievements and Governor Blagojevich’s historic plan to give every Illinoisan access to affordable, quality healthcare coverage.
Over the last four years, Illinois has expanded access to healthcare to more than 560,000 more people without raising taxes and while cutting the Medicaid backlog in half, reining in growth of the Medicaid program, and setting a guaranteed payment cycle for doctors. Governor Blagojevich’s “Illinois Covered” proposal, announced in last week’s 2007 Budget Address, would continue that progress by helping Illinois’ 1.4 million currently uninsured adults get access to quality health coverage at affordable rates. Director Maram made his presentation today at the Civic Federation and Federal Reserve Bank of Chicago’s Medicaid forum.
“Over the last four years, we have helped more families in Illinois get healthcare than ever before, and we have done it without raising taxes on working families and while keeping Medicaid costs down,” said Gov. Blagojevich. “Now, it is time to build on those successes, and move forward with our plan that provides tax fairness and access to healthcare for all Illinoisans.”
Under Governor Blagojevich, Illinois has expanded access to healthcare to over 560,000 more people, and became the first state in the nation to provide access to comprehensive health insurance to every uninsured child in the state through All Kids. As a result, the Kaiser Family Foundation ranked Illinois #1 in the nation for adding working parents to healthcare for 3 years in a row, and credited Illinois for sparking a national movement to provide healthcare to all children.
At the same time, Illinois’ Medicaid program grew by only 1.4% in FY 2006 – the 6th lowest nationwide, and the lowest rate of growth for Illinois since 1996. Growth is estimated to be 4.4% for FY2007, less than the estimated average growth rate across the country. The average yearly rate of growth for the Medicaid under the previous administration was 9.2%. In addition, over the FY 2005 and 2006 budgets, HFS instituted significant and tangible reforms that have provided more than $450 million in on-going cost-savings for the state’s Medicaid program. These cost-savings strategies allowed HFS to set a defined payment cycle for doctors who treat Medicaid patients for the first time in state history. Under the new cycle, doctors receive payment for their services in no more than 60 days from the time clean bills are received by the state, and doctors who treat children in the All Kids program remain on an expedited 30 day or less payment cycle.
While the Governor’s “All Kids” plan, which took effect last year, extended coverage to all children in the state, approximately 1.4 million adults in Illinois are currently uninsured. A majority, roughly 75 percent, are from families with moderate incomes or higher. The Governor’s Illinois Covered plan will provide affordable coverage to the uninsured and will also help many middle-income families and small businesses that are currently enrolled in health insurance plans save thousands a year on healthcare costs. The plan will also reform the existing healthcare system to improve quality and require more accountability. The primary components of Governor Blagojevich’s Illinois Covered plan include:
- Illinois Covered Choice: Creates a new, affordable comprehensive insurance plan that anyone without employer-sponsored health insurance in Illinois can purchase. This statewide pool of coverage will offer Illinoisans lower and stable rates. Business groups will be able to connect many of their members with this new affordable insurance, and small business owners can also purchase this product on behalf of their employees.
- Illinois Covered Rebate: Lowers premiums for moderate to middle-income Illinoisans ($20,000-$80,000 for a family of four) to help them afford their health insurance. The rebate will vary based on income, and those with lower incomes would get a larger rebate.
- Illinois Covered Assist: Similar to FamilyCare and Medicaid, individuals or couples who are very low-income will now have access to full coverage through the state (individuals currently making less than $10,210 annually, and couples making less than $13,690).
The Governor also proposes expanding the existing FamilyCare program to 400% of the federal poverty level for those who do not have access to employer sponsored coverage, to expand health benefits for workers with disabilities, and to allow dependants to retain coverage until age 29. Additionally, the state will work with both consumers and healthcare providers to develop a Roadmap to Health that will improve the state’s overall healthcare system and promote wellness, while better managing chronic conditions, the most important component for driving down overall healthcare costs.
To make new investments in healthcare, education and pensions, Governor Blagojevich’s unveiled his Tax Fairness Plan for Fiscal Year 2008 to take historic steps to change the Illinois tax structure – one of the most regressive and unfair to working families in the nation. In 1977, the corporate share of the state income tax was 21%, while individuals paid 79%. Today, the corporate share is 12% and people pay 88%. In fact, the average taxpayer in Illinois pays $1,500 in state income taxes while over 12,500 of the largest companies that do business in Illinois pay on average $151 in corporate income taxes.
Many large corporations pay little or nothing in corporate income taxes, and they are not paying their fair share to meet the state’s ongoing infrastructure, education, healthcare and public safety needs. According to the Illinois Department of Revenue, 37 of the 99 ‘Fortune 100’ companies that filed taxes in Illinois paid no state income taxes, despite the fact that they averaged $1.2 billion in sales during 2004. On average, 48 percent of corporations that generated $50 million or more in annual sales in Illinois paid no income taxes from 1997 through 2004.
The Governor’s Tax Fairness Plan implements a Gross Receipts Tax (GRT) that has been embraced by many economists because of its broad base and low rates. States including Washington, Delaware and Hawaii have had a GRT for years, and, recently, Ohio and Texas have adopted a form of the tax. The GRT will only apply to businesses that make more than $1 million each year, which means 75 percent of all businesses in Illinois will be exempt. The GRT will tax service industries at a low 1.8 percent rate, while manufacturers, construction, retail and wholesale companies will be taxed at an even lower .5 percent. Exports will not be taxed. The plan also mitigates costs being passed on to consumers by excluding certain goods, such as retail food and pharmaceuticals.