May 17, 2006

The Honorable Rod Blagojevich
Governor of Illinois
Statehouse, Room 207
Springfield, Illinois 62706

Dear Governor Blagojevich:

Over the last several months, the Illinois State Medical Society has become increasingly alarmed that access to medical care for our most medically vulnerable patients - those covered through Medicaid - is being compromised by the state's payment and budgetary processes. ISMS continues to hear from our members at a steadily escalating pace about lengthy payment cycles and the harsh impact it is having on their capacity to continue caring for Medicaid patients.

Illinois physicians are committed to providing care to patients without health insurance, as well as those receiving Medicaid assistance. However, the State must also live up to its commitments. These include creating a stable system for patients to access the medical care they need, and paying physicians on a timely basis so that they can be there for patients who need them. Medicaid rates in Illinois average only 63 percent of Medicare payment rates, and to make matters worse, physicians experience enormous delays to receive these low payments.

We've heard recent reports of physicians taking out substantial loans just to keep their medical practices viable - to pay the rent, cover the payroll, and keep the lights on - all while awaiting Medicaid reimbursement for patient services rendered many months past. The lack of timely payment is causing great hardship for many physicians who treat Medicaid clients, especially those with high volume practices. Although an expedited process can be extended to those with 50% or more Medicaid revenue, the reality is that many practices with 25% - 45% Medicaid revenue are equally vulnerable to financial problems caused by low and slow pay. The payment crisis has hit especially hard in underserved areas of Illinois, making it enormously more difficult to recruit and retain physicians.

Last year, the Society supported the AllKids program in concept because we are committed to expanding access to health insurance. However, we cannot continue to support a health insurance program that is severely and perpetually underfunded. At a time when the State is expanding Medicaid eligibility through the AllKids program, the current slow and low pay situation makes physicians ever more reluctant to participate. In reality, physicians are subsidizing this program expansion, through low reimbursement rates and long payment delays.

Even more alarming is that the budget for FY 2007 does not appear to solve this problem. We have been told that payments to primary care doctors for services provided to children will be increased and expedited. However, without an infusion of new resources, overall payment delays will likely worsen. Improving payment timeliness for one group while all others languish is not a solution in our view, and will only hasten an inevitable collapse of access to medical care.

ISMS urges you to recognize and address the destructive economic forces currently at play in the Medicaid budget, which could also undermine access to medical care for AllKids patients. At a time when this administration is seeking to expand coverage, there needs to be an equal commitment to fairer and more timely payment to all physicians who provide care to Medicaid recipients. Providing fair and timely reimbursement for services to patients covered by state programs is essential to ensuring access to primary and specialty medical care.

ISMS stands ready to work with you to develop a solution for this problem.

Sincerely,

William E. Kobler, M.D.
Chair, Board of Trustees

cc: Peter E. Eupierre, M.D.
     Rodney C. Osborn, M.D.
     Alexander R. Lerner
     Tom Cross
     Emil Jones, Jr.
     Michael J. Madigan
     Frank C. Watson
     Barry S. Maram, Director - DHFS

Twenty North Michigan Avenue, Suite 700 Chicago, Illinois 60602 Telephone: 312-782-1654 Toll Free: 800-782-ISMS Fax: 312-782-2028