Medicaid is where cutting gets serious

The House’s approval this week of a proposal to end legislative scholarships is another welcome, if small, sign that Springfield is getting serious about addressing even the little things that can add up to real savings. As we’ve said in the past, this program needs at least a moratorium while the state’s financial health improves and ways are found to eliminate the fraud and abuse that have plagued it.

But a few other things also need to be said.

For one, even if this makes it past the Senate — which similar efforts haven’t been able to do in the past — its $14 million or so in savings represents a paltry start on the billions in state spending that still must be cut to return the government to health. And, it’s not technically even savings for the state. The scholarships are awarded to students attending state institutions, which themselves must absorb most of the cost. From any angle, this action is more about stemming ethics abuses than saving money.

Moreover, there is no reason that legislators opposed to the scholarships can’t just stop issuing them. About 40 percent already have.

But the opportunity for an even more meaningful demonstration of budgetary backbone came in Springfield on Thursday, when Senate President John Cullerton called a rare committee-of-the-whole-style meeting so senators could examine diverse approaches, and the effects of many of them in other states, to managing Medicaid expenses.

Along with its crushing pension obligations, the state’s spiraling Medicaid costs are one of the top contributors to Illinois’ financial crisis, with a backlog of unpaid Medicaid bills expected to approach $1.8 billion by the end of this fiscal year, according to The Associated Press — and this amid rising demand in new bills.

Lawmakers have for years identified Medicaid — in particular Medicaid fraud — as a prime area for attention, but almost all would agree that much more remains to be done. Last year, they set a requirement that 50 percent of the program be moved into managed care by 2015, and Gov. Pat Quinn called for a Medicaid reduction of $2.7 billion in next year’s fiscal budget.

A national expert told lawmakers Thursday that no state has ever cut back Medicaid by the proportion Quinn is proposing — about 20 percent. As State Government Writer Mike Riopell reported in the Daily Herald last week, just shifting to a managed care system has been fraught with complications for some of the state’s most vulnerable citizens. But these can be addressed, and gaining control of Medicaid spending has to remain a legislative priority.

Cullerton, the Senate’s top Democrat, told The Associated Press this week that senators want “to learn about everything that’s on the table,” and he emphasized that Democrats agree with the need to cut programs, calling on Republicans to join productively in the discussion to do that. Thursday’s “Medicaid funding workshop,” as it were, is a start in that direction. Lawmakers serious about cutting state spending effectively, from both parties, will take what they learn and keep it moving.