CHICAGO, June 28 (Reuters) - A ruling on how much more money Illinois needs to allocate to Medicaid provider bills to ensure continued medical care for the state's poor and disabled residents should come out on Friday, a U.S. District Court judge said on Wednesday.
Judge Joan Lefkow questioned a proposal made by attorneys representing Illinois' 3 million Medicaid recipients that would force the cash-strapped state to send $2 billion to managed-care organizations over four months to pay down a $3.1 billion bill backlog.
The attorneys also asked for an additional $586 million in monthly payments to providers starting July 1, noting that federal Medicaid reimbursements would cut Illinois' total outlay about in half.
The judge called the proposed funding scheme a "significant jump."
In her June 7 order, which found Illinois was not complying with federal consent decrees regarding Medicaid, Lefkow said plaintiffs were merely seeking sufficient payments to sustain services.
But negotiations ordered by the judge failed to reach a deal. Brent Stratton, an assistant Illinois Attorney General, told the judge the plaintiffs were attempting to get "blood from a stone," given the state's lack of a budget for two years and its $15 billion pile of unpaid bills.
Lefkow instructed the state to submit its proposal for a $75 million increase in monthly Medicaid payments that would be matched by $75 million in federal funds, along with a plan to reduce outstanding unpaid bills. She also asked the other side to present evidence that Medicaid recipients were being denied care due to the state's nonpayment of bills.
Illinois' payments out of its operating fund for the Medicaid and other federal consent decrees total about $160 million a month.
David Chizewer, an attorney for Medicaid recipients, said by accepting federal Medicaid dollars Illinois must comply with the consent decrees that stem from lawsuits filed in 1992 and with federal law.
"We are not asking them to print up money that doesn't exist, but for a shift in priorities," he said.
In a court filing on Tuesday, Assistant Illinois Comptroller Kevin Schoeben said increasing the amount of priority payments made out of the state's general fund for Medicaid beyond the proposed additional $75 million would result in insufficient revenue to make full monthly payments to other priorities such as pensions and payroll.
Meanwhile, Illinois lawmakers face a Friday deadline to pass a budget ahead of the Saturday start of fiscal 2018. (Reporting by Karen Pierog; Editing by Matthew Lewis)