The potential repeal and replacement of the Affordable Care Act (ACA) is as much about municipal budgets and economics as it is about the individuals who rely on it for coverage. Federal Medicaid reimbursements, newly created preventive care grants, and financial incentives for neighborhood clinics have been a boon for Illinois hospitals and health centers. In a special 36 minute episode of The Aldercast, we take a deeper dive into this topic to explain what the healthcare landscape was like in Illinois before the ACA, how it changed, and what taxpayers, governments, and providers stand to lose from a potential repeal.
Across the state, the healthcare industry generates about $13 billion a year in economic activity, according to the Illinois Health and Hospital Association (IHA). A majority of that output is concentrated in the Cook County and Chicago-metro area.
For Illinois, the stakes of a potential repeal are especially high–the state hasn’t had a budget in two years, has already seen the shutdown of dozens of social service agencies, and has one of the fastest rates of population loss in the country. In a letter addressed to U.S. Senator Dick Durbin dated December 21, 2016, IHA’s President and CEO, A.J. Wilhelmi, warned a repeal of the health care law could mean the potential loss of $11 to $13 billion in annual economic activity in the already beleaguered state. Between 84,000 and 95,000 jobs could be lost.
“For every dollar hospitals spend, there is an additional $1.41 generated in spending in the local and state economies,” Wilhelmi says. “For every hospital job in Illinois, nearly one and a half jobs are created in other sectors. So of course with $3.2 billion coming into the state through Medicaid expansion, as well as the impact of people getting coverage through the Marketplace, you can see where there’d be an upside gain to the upstate economy and jobs, and we’ve certainly seen that reflected in the hospital community.”
More than 260,000 Illinoisans are employed by the state’s hospital system. When adding the indirect jobs–from companies that service the hospitals to local businesses where hospital employees spend their paychecks–the number jumps to 500,000, IHA estimates.
Cook County alone is home to more than 75 hospitals, 160 Federally Qualified Health Centers, along with dozens of health centers, nursing homes and hospice organizations. Recent U.S. Census data found that 7.5% of the county’s employees work in the healthcare field. Half of the county’s annual $4.5 billion budget is dedicated to healthcare. And because of the expanded Medicaid provisions, which reimbursed states up to 100% of the additional costs for covering low income adults for the first years of the program, CCHHS moved its books into the black three years in a row for the first time in its history.
With the influx of federal dollars, the local taxpayer contribution to support CCHHS has decreased by $370 million. Cook County started its own Medicaid Managed Care Organization, CountyCare, which brings in Medicaid reimbursements and new patients. For the first time in its 200 year history, CCHHS has operated in the black for three years in a row. Thanks in part to the financial stabilization of the ACA, CCHHS launched an ambitious Central Campus redevelopment plan, a more than $100 million investment.
Should the ACA be repealed, Cook County would have $300 to $500 million hole in its budget, county officials have warned. This, after the county board pledged not to raise taxes again until 2020.
Chicago’s public health department has benefitted from more than $10 million in new federal prevention grants. Because of the ACA, the Centers for Disease Control spends 12% of its annual budget dispersing federal dollars to local governments for vital public health initiatives, and Chicago has received $12.8 million from the CDC’s Prevention and Public Health Fund since it was established. Public Health Commissioner Dr. Julie Morita has said this helped bring the city’s teen pregnancy rate to an all-time low, increased the number of checkups from the low 60s up to 80 percent, and resulted in close to 700 fewer diabetes-related hospitalizations between 2010 and 2014.
In a joint hearing of the city’s and county’s workforce committees, Morita warned the knock-on effects of a repeal–which expanded insurance to 480,000 people in Cook County–would further burden local jails, homeless centers, and emergency departments.
In this episode, we’ll tell you how neighborhood clinics benefitted from an influx of the newly-insured, from the perspective of local clinic, Erie Family Health, and Norwegian American Hospital, a safety net hospital in Humboldt Park. Both were able to use ACA funds to digitize records, expand and coordinate care, and, most importantly, eliminate one of the largest drains on their resources: uncompensated care.
If you enjoy the episode and are interested in additional information, some useful links are below.
- American Hospital Association Report on Impact of Repeal without Replace
- Statement on Introduction of the American Health Care ACT (AHCA) (Speaker Paul Ryan)
- Section by Section Summary of the AHCA (Energy/Commerce Committee)
- Official Bill (American Health Care Act)
- Health & Human Services Budget Briefing (FY 2018)
- Rauner Admin Letter to Congress Re: Repeal
- Preliminary Economic Impact of Affordable Care Act Repeal (IHA)
- IHA Advocacy on ACA/Medicaid/Medicare
- Durbin Hears From Southern Illinois Healthcare Leaders On Local Impact Of Repealing Affordable Care Act
- Families USA Stats on Illinois