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June 29, 2004

Governor Blagojevich Announces Illinois Taps $25 Million in Additional Federal Medicaid Funds
Department of Public Aid beats June 30 deadline to qualify for enhanced reimbursement

SPRINGFIELD, Ill.— Gov. Rod R. Blagojevich today announced that the state will reap $25 million in additional Federal matching funds as a result of paying out $850 million in Medicaid bills ahead of a June 30 deadline.
By beating the deadline and issuing payments to hospitals, nursing homes, doctors, pharmacists and other medical providers throughout Illinois, the state qualifies for an enhanced Medicaid reimbursement of 53 percent instead of 50 percent.
“This is great news for Illinois taxpayers,” said Governor Blagojevich.  “At a time when we are facing a historic budget crisis, we have to make sure we take advantage of every opportunity available to bring in new revenues to the state that helps us invest more in healthcare and avoid increasing the sales or income tax.”
The payments bring the Medicaid payment cycle for medical providers down to an average of 15 days.
The Illinois Department of Public Aid (IDPA) and the Governor’s Office of Management and Budget (GOMB) took advantage of historically low short‑term interest rates to obtain financing to make the payments possible before the end of fiscal year 2004 on June 30.
If the state had waited to make the payments until after June 30, the state’s reimbursement rate would have dropped to 50 percent, instead of the enhanced rate of 53 percent authorized by the U.S. Congress as part of the state fiscal relief package in 2003.
IDPA sent over payment vouchers to the Comptroller’s Office in the last two weeks that came up just 39 cents short of expending the entire $850 million. The last payment vouchers went over Monday and the reimbursement checks were scheduled to go out Tuesday night.
“One of IDPA’s top priorities under the Blagojevich administration is to optimize the retrieval of federal matching funds,” said IDPA Director Barry Maram. “We can’t afford to leave enhanced federal aid on the table at time like this. At the same time, we are delivering on the Governor’s commitment to pay our bills on time.”
The financing mechanism required approval from the Legislature as well as the Comptroller’s Office and the Treasurer’s Office.



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