State, County Officials Introduce Plan to Aid Struggling 'Safety Net' Hospitals

Financial First Aid Would Help Hospitals for Low-Income Stay Open

CHICAGO, Jan. 8 /PRNewswire-USNewswire/ -- Reeling from the costs of treating
the poor and uninsured, the Chicago-area's "safety-net" hospitals would gain
crucial financial relief under a joint state-Cook County proposal supported by
a coalition of hospitals and the state's largest health care union.

The ordinance introduced Wednesday by Cook County President Todd H. Stroger
and members of the Cook County Board, Illinois Senator Jeff Schoenberg
(D-Evanston), the Service Employees International Union (SEIU) and a coalition
including health care institutions, would aim to increase state and federal
support to the financially embattled Chicago-area hospitals that provide the
majority of the state's Medicaid-funded services. If approved by state and
federal officials, the proposal would build upon an existing hospital funding
plan -- also spearheaded by Schoenberg -- that expires June 30th.

"This critical infusion of federal dollars will help hospitals and other
health care providers ensure accessible, affordable and quality healthcare
services for those who live in underserved communities across Illinois," said
Schoenberg. "Without these resources, hospitals serving residents of
predominantly lower- and lower-middle-income communities in the Chicago area
and those Downstate would be threatened with closing their doors or
drastically cutting services to stay alive."

Schoenberg is Chairman of the Illinois Senate Appropriations II Committee and
the architect of earlier assessment plans that reaped an additional $2.3
billion over the past five years in new federal funding for Illinois hospitals
and healthcare providers.

Without the continuation of this critical aid, many of Cook County's
low-income patients could be left in a health care vacuum.

"The funds generated from this plan will ensure that we can continue our
critical mission of providing health care services to low-income individuals
in our communities," said Sister Sheila Lyne, CEO of Mercy Hospital & Medical
Center, which supports the proposed measure. "Because hospitals like ours
serve most Medicaid patients, we face financial hardships that are unique to
safety-net hospitals. Under this proposed ordinance, we will stand a better
chance of surviving, so that our patients will, too."

The proposed plan is supported by numerous private and public hospitals that
provide a significant amount of Medicaid services within the county.

Under the proposed plan, Cook County hospitals would pay assessments totaling
$730 million. The assessments would generate approximately $600 million in
matching federal revenue for a pool of $1.2 billion, which would be reimbursed
to hospitals statewide with Cook County hospitals earning the largest share.

The proposed measure represents the starting point in discussions between
state and county leaders to adopt a new hospital funding plan. Ultimately,
that consensus proposal would be submitted for approval to the Federal Centers
for Medicare and Medicaid Services. Absent an approval plan, the state and
county will lose over $600 million in federal funds this year.

The plan's sponsors said the funding mechanism will create a closer connection
between the amount of Medicaid care a hospital provides and the reimbursement
that it receives. More than 63 percent of Illinois' in-patient Medicaid
services are delivered from hospitals in Cook County.

"By treating large Medicaid populations, Cook County's private and public
hospitals form a crucial public safety net for the poor and the sick," said
Dr. Robert Simon, Interim Bureau Chief, County Bureau of Health Services.
"They also reduce demand on County Hospital, lowering costs for taxpayers. If
we don't help these hospitals survive, public health will suffer."

The plight of these safety net hospitals has drawn support from SEIU, which
represents thousands of health care workers dependent on the future of these
institutions.

"The survival of these hospitals is instrumental to the welfare of our members
and their families," said Byron Hobbs, President of SEIU Local 20, which
represents health care workers. "Without these hospitals, our economy would
be as sick the patients who lose access to care."

Currently, the state of Illinois retains a portion of the money collected from
its hospital tax to fund health-related services. Cook County officials hope
to establish an agreement with state officials to receive a share of that
residual money, which would be earmarked to support Cook County hospital.

"This plan would be accompanied by state legislation containing the necessary
safeguards to ensure that the federal money is spent on those areas that
provide greater access to quality health care," Schoenberg said.

An ordinance reflecting the proposed funding plan is scheduled to be
introduced in the Cook County Board of Commissioners on Wednesday. The
companion state legislation will be introduced by Schoenberg when the Illinois
Senate reconvenes this week in Springfield. The Senate Appropriations II
Committee, of which Schoenberg is the chairman, has already begun a series of
statewide hearings on the next version of the hospital assessment plan.

SOURCE Office of State Senator Jeff Schoenberg

Ambar Mentor, +1-312-408-2580 ext. 25, +1-773-343-1481, or Mike Truppa,
+1-312-408-2580 ext.12, +1-773-286-5077, both of Valerie Denney
Communications, for the Office of State Senator Jeff Schoenberg