Judge to Illinois: Pay Your Medicaid Bills

The state of Illinois has been without a formal budget for almost two years, sending ripple effects through various parts of the state’s economy and public services. But now a federal judge has ordered the Prairie State to begin addressing payments due to Medicaid providers, which currently total $2 billion.

U.S. District Judge Joan Lefkow issued a ruling last week that would compel Illinois comptroller Susana Mendoza to begin paying Medicaid providers in the state by June 20, the Chicago Tribune reported. Providers looking for full repayment probably should adjust their expectations, though: The order only impels Mendoza to make a “substantial” dent in the $2 billion Medicaid bill, according to the Tribune, and the comptroller herself admitted that the cash just might not be there.

Illinois has been in the midst of a budget battle royal for the past two years, with Republican Gov. Bruce Rauner and Democratic House Speaker Michael Madigan unable to produce legislative compromises over the Prairie State’s deep funding problems: Illinois finds itself $14.9 billion in the red, with the state’s schools alone owed $1 billion. Earlier this year, Chicago Public Schools threatened to end the school year almost a month early, citing funding problems, before Chicago mayor Rahm Emanuel stepped in with a plan to take out an emergency bridge loan to keep its doors open through June.


Part of the problem for Medicaid providers is that state law requires certain expenditures — including public school funding, employee salaries, and pensions — to be first in line, forcing skilled nursing providers, hospitals, and other health care companies to wait their turn. For instance, assistant comptroller Kevin Schoeben said that 90% of the state’s cash goes toward these so-called “core priority” payees, according to the Tribune, leaving just  the remaining 10% for all other costs.

Mendoza’s office issued a very brief statement in response to the ruling, hinting that Illinois may simply be unable to follow the judge’s orders.

“The lack of a budget for the last two years has created a situation in which we now have more court-ordered and state-mandated payments than we have revenues to cover them,” Mendoza said. “The real solution to this crisis is a comprehensive budget plan passed by the General Assembly and signed by the governor. Now.”


Medicaid remains the primary payer for skilled nursing services nationally, and generally serves the most vulnerable classes of patients, including children, low-income adults, and people with disabilities.

Written by Alex Spanko

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