Sandack: Health care contract issues remain
Updated: June 8, 2012 10:56AM
Senate lawmakers worked to move bills through the legislative process before this week’s deadline, advancing hundreds of measures addressing issues that state Sen. Ron Sandack (R-23rd District) said range from criminal justice and procurement matters to state financial reporting and veterans’ assistance.
Also this week, the Legislative Audit Commission met to review the handling of an almost $7 billion state health care contract, which was sharply criticized in recent weeks by the auditor general. A new report by a financial ratings agency once again placed Illinois’ budget woes in the spotlight.
Hundreds of bills were approved by Senate lawmakers this week, which was the deadline for most Senate measures to be sent to the Illinois House. When the Senate members return, they will concentrate on proposals that originated in the House, while the House members focus on the measures the Senate sent to them.
Several bipartisan measures seeking to help Illinois veterans were among the bills approved in the Senate. Illinois veterans suffering from Post Traumatic Stress Disorder will have greater access and ability to utilize service dogs in public places as part of Senate Bill 3687, which enables service men and women living with PTSD to take their service dog into all public places and buildings designated by the state.
On a related note, following a recommendation by the Illinois Discharged Service Members Task Force, under Senate Bill 2837,citizens who have served in the military could request that a “Veteran” designation be placed on their state-issued identification cards.
The measure would allow the “Veteran” designation to be placed on drivers licenses, state ID cards and disabled ID cards, as is allowed in 14 other states. It will help veterans, who often qualify discounts and other benefits upon providing proof of their service, Sandack noted.
In an effort to reduce the high rate of unemployment among returning servicemen and servicewomen, Senate Bill 3241 would offer Illinois employers a tax incentive for hiring a qualified unemployed veteran.
In order to encourage employers to hire members of the Armed Forces, Senate Bill 3241 will offer a tax credit of up to $5,000 to employers who hire a qualified veteran who had been unemployed for an aggregate of four weeks or more during the year prior to their date of hire. The tax credit will be equivalent to 20 percent of the veteran’s gross wages during the tax year, not to exceed $5,000. As a continuation of current law, employers who continue to employ a veteran can collect a credit equal to 10 percent of the gross wages paid to the veteran, not to exceed $1,200.
One piece of legislation Sandack said was not called for a vote this week was the measure to eliminate the Legislative Scholarship Program. The program has been ripe with corruption; and the entire Senate Republican Caucus has called for it to end, Sandack noted.
“Eliminating the Legislative Scholarship Program is an absolute no-brainer and yet it continues,” he said. “It’s one of those programs that is so easy to do away with for many reasons.
“ We would ease the financial burden on colleges and universities and end the corruption of the program with it. Why the legislation was not passed, I have no idea; and it’s extremely disappointing that it wasn’t.”
Also of note,. Sandack said, the House passed two bipartisan resolutions Thursday regarding the fiscal year 2013 budget. Their plans would require cutting billions of dollars in funding to programs such as Medicaid and education. Sandack commented that “reality is beginning to set in.”
“Whether the proposed spending plan and cuts by the House are enough to put Illinois on a financially sustainable path is a legitimate question,” he said. “But the change in direction is unmistakable.”
The measures now move to the Senate for consideration.
While state legislators spent much of their time considering pending legislation, members of the Legislative Audit Commission did meet on Thursday in response to a recent audit blasting the Quinn administration’s handling of a nearly $7 billion health care contract.
A March 8 report by State Auditor General Bill Holland sharply criticized the Illinois Department of Healthcare and Family Services for its handling last year of a five-year, $6.6 billion contract to the state’s largest insurer to administer health maintenance organization plans for state employees. The nearly $7 billion procurement dealt with the health care of state employees, retirees and dependents.
Illinois lawmakers wanting to know who was accountable for mistakes made in awarding health insurance contracts, Sandack said, heard administration officials pass the buck – rather, 6.6 billion bucks – during the hearing. Audit Commission members asked DHFS officials what had gone wrong during the process of selecting vendors for state-administered HMO and open access plan insurance coverage. During the discussion, it became evident that different officials had different interpretations of the Illinois law detailing oversight of the procurement process.
Testimony from DHFS and Executive Ethics Commission representatives indicated that neither entity was clear on who has the ultimate authority and responsibility for the mistakes made in the process of awarding state health care contracts, which affects thousands of state employees and retired workers.
Lawmakers on the Audit Commission agree that the governor and his Office of Management and Budget have questions they need to answer about why certain memos were ignored and why they continued along a line that cost the state money and put at risk the people who depend on state health insurance.
Sandack said there are a lot of issues that remain to be resolved, some statutory, so the complications, confusion and concern surrounding this process do not happen again. Lawmakers are continuing to monitor this process and working with legislative leaders, the Audit Commission, the Department of Healthcare and Family Services, and the Executive Ethics Commission to clarify the statutes and improve the process by which vendors are selected.
The state’s finances were once again in the news, following a report published by Fitch Ratings showing that as a percentage of residents’ income, Illinois state government has the second-highest debt in the nation.
Illinois’ public debt represents 25 percent of Illinois residents’ annual income. Only Hawaii, with a debt that equals 25.8 percent of annual income surpasses Illinois. The third-highest debtor state is Connecticut at 22.9 percent.
Illinois’ debt-to-income ratio is more than 3 1/2 times higher than the national average of 6.9 percent. Sandack noted that Illinois is alone in the nation with its combination of high debt and poor credit rating.
Fitch Ratings calculates that Illinois taxpayers owe $134 billion, including $101 billion in pension debt and $33 billion in other state government debt. The Fitch calculation does not include Illinois’ backlog of bills, which is $8.5 billion, according to the Illinois comptroller and would drive the total debt even higher, if included. The non-partisan Civic Federation has estimated that the bill backlog alone will climb to $35 billion within five years.
The state with the lowest debt-to-income ratio is Tennessee, where state government owes debt equal to 2 percent of residents’ annual income.
Illinois fares far worse than most of its fellow large states. California, with a credit rating that shares the bottom of the nation with Illinois, has a lower debt-to-income ratio of 8.9 percent. Among the 10 most populous states in the nation, Illinois is the only state with a debt-to-income ratio greater than 10 percent.
Illinois’ non-pension debt is 6.2 percent of personal income, while the pension debt is 18.8 percent of personal income.
Lastly, on Wednesday, Sandack welcomed Louie Buttny from Downers Grove to Springfield as his senate page for the day. Buttny is a junior at Downers Grove North High School and was joined by his parents, Lou and Judy Buttny.