Comptroller’s Initiatives Win Approval
Two measures to benefit Illinois taxpayers and consumers that were championed by Comptroller Susana Mendoza in the spring are now law.
The first addresses transparency shortfalls within the state’s managed care program. The second establishes a statewide program to encourage consumers to use traditional banking services rather than rely on expensive short-term loan companies and pawnshops for financial assistance.
Illinois spending on managed care organizations (MCOs) rose from $251 million in fiscal year 2010 to $10.8 billion in fiscal year 2019. Much of this increase was because of a $63 billion expansion of managed care in fiscal year 2018 — the largest procurement in Illinois history.
This substantial shift in spending has implications for transparency, care for some of Illinois’ most vulnerable residents, and the state’s overall health care system.
Comptroller Mendoza introduced legislation to address this lack of transparency during the 2019 spring legislative session. Her bill, along with others addressing issues with the state’s Medicaid system, was discussed in a legislative working group led by Illinois House Majority Leader Greg Harris, D-Chicago, and State Sen. Heather Steans, D-Chicago. Ultimately, the omnibus legislation that emerged from the working group and became law addressed the issues with transparency that the Comptroller’s office had raised.
Public Act 101–0209 creates a clearinghouse that will allow the Illinois Department of Healthcare and Family Services (DHFS) to view and save every claims-related interaction between a health care provider and an MCO. This window to the process will allow the agency to gather the type of information the Comptroller sought in her initial legislative proposal. Claim submission; responses, including full and partial denials; and submission and payment dates would be captured by the agency through the clearinghouse in real time.
DHFS also will create a portal where providers can submit claims disputes with MCOs for a final ruling from the agency. The portal includes specific instructions and timelines that all three parties — the MCOs, the providers, and the agency — will follow. The goal is to avoid the prolonged disputes that force providers with limited capital reserves to settle for significantly less — a common complaint of providers.
Additionally, the new law requires DHFS to report MCO administrative costs and operations to the public. In the past, the agency was unable to track this data. To learn more about Illinois’ shift to managed care, refer to the May 2019 edition of Fiscal Focus.
BANK ON ILLINOIS
Lack of access to traditional banking is a problem in both rural and urban areas of Illinois. Families without bank accounts pay tens of thousands of dollars in fees over their working lives, often relying on predatory lenders, payday loans, and pawn shops for loans and financial transactions.
Public Act 101–0427 will expand access to banking in Illinois by using Bank On, a proven, national model that aims to connect consumers with reliable, affordable, and equitable financial products. The measure will create a Bank On Illinois program in the Comptroller’s office. Under this program, the Comptroller will partner with governmental entities, representatives of the community, and financial institutions to certify financial products for low-income customers and promote the program throughout Illinois.
Bank On programs certify products that provide fair financial service options such as no maintenance fees, low minimum deposits, low or no overdraft fees, and alternative IDs. They also provide secured personal loans — low-risk lending that enables consumers with low credit scores to begin rebuilding their credit.
Comptroller Mendoza; State Sen. Cristina Castro, D-Elgin; and State Rep. Debbie Meyers-Martin, D-Olympia Fields are joined in their efforts by banking organizations, community advocates, and local government officials who supported Public Act 101–0427.
Over the coming months, the Comptroller’s office will work with the sponsors and supporters of the new law to develop a commission and establish criteria for the program. Look for updates on the Comptroller’s website about how to participate.