Illinois Employees Sue Over Budget Freeze

     CHICAGO (CN) — Illinois state workers, complaining about their withheld health insurance payments due to the state’s budgetary disaster, sued the governor and the state’s management agency in a class-action lawsuit.
     The complaint stems from a decision by Illinois last September to suspend claims payments to insurers for nearly 150,000 state workers and their families due to the state’s budget crisis. As a result, state workers are now stuck footing the bill for medical expenses because doctors and hospitals have not received insurance payments, the workers claim.
     The suspension “violated plaintiff’s Illinois constitutional rights” and threatens the health care of state employees who may be financially strapped, according to the April 13 lawsuit, filed in Cook County Chancery Court by Carrie Weeks-Kinowski.
     “[T]here is a substantial possibility that state employees will forego needed medical care, either because they will not be able to afford to pay for the care up front at the time of service, or because they fear that self-insured insurance companies will demand such payments up front,” the 20-page complaint states. “It is virtually certain that some individuals who forego health care will become ill as a result of doing so.”
     The lawsuit names as defendants Illinois Gov. Bruce Rauner, Treasurer Michael Frerichs, Comptroller Leslie Geissler Munger, and Michael Hoffman, the director of Illinois’s Department of Central Management Services, the agency that handles state employee benefits.
     Illinois’s 2016 budget was due last July, when the state’s fiscal year begins. However, a standoff between Rauner, a Republican, and a Democratic-controlled Legislature has delayed approval for nearly 10 months. The Illinois budget crisis now seems to have no end in sight.
     Illinois remains the only state without a budget for the 2016 fiscal year.
     One of the casualties of the budgetary delays has been the state’s health insurance reserve fund, which pays for employee insurance plans.
     Illinois had contracted with insurers Quality Care, Coventry Health Care Open Access Plan, and Health Link OAP to handle claims for the state’s self-insured insurance plan. Under those plans, the insurers submit claims to the state and are paid with money deducted from state employee paychecks.
     On Sept. 11, 2015, however, the Illinois Department of Central Management Services posted a notice on its website saying that it would soon halt those payments until the state’s 2016 budget was approved.
     The snowball effect then began. Participating health plans stopped paying doctors and hospitals in most cases, which then billed patients directly for medical services, according to Wednesday’s class-action lawsuit.
     The budgetary stalemate has caused the state to miss payments on more than $7 billion in bills. Some estimates peg the amount Illinois owes in state employee health are coverage at nearly $3 billion. Hospitals and doctors have been quoted in recent months saying they are owed payments from almost two years ago in some cases.
     In her lawsuit, Weeks-Kinowski, who works as a civil service employee at Northern Illinois University and uses the Health Link plan, seeks not only immediate payment of health claims by Illinois, but also payments to employees of 5 percent interest on the cash they have shelled out up front for medical services.
     “While the state has procedures in place to pay interest to insurance providers who are paid in an untimely manner, it has no procedures in place to pay state employee participants interest if they must pay cash for medical services and await reimbursement from medical providers,” the lawsuit states.
     A spokesperson for the state did not immediately respond to an email seeking comment on the class action.

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