{"id":13979,"date":"2025-07-14T09:57:14","date_gmt":"2025-07-14T14:57:14","guid":{"rendered":"https:\/\/www.thexradio.com\/news\/?p=13979"},"modified":"2025-07-14T09:57:14","modified_gmt":"2025-07-14T14:57:14","slug":"illinois-hospitals-fear-massive-cuts-under-trump-domestic-policy-law","status":"publish","type":"post","link":"https:\/\/www.thexradio.com\/news\/local-news\/13979-illinois-hospitals-fear-massive-cuts-under-trump-domestic-policy-law\/","title":{"rendered":"Illinois Hospitals Fear Massive Cuts Under Trump Domestic Policy Law"},"content":{"rendered":"<div class=\"pdfprnt-buttons pdfprnt-buttons-post pdfprnt-top-right\"><a href=\"javascript: window.print()\" class=\"pdfprnt-button pdfprnt-button-print\" target=\"_self\" ><img decoding=\"async\" src=\"https:\/\/www.thexradio.com\/news\/wp-content\/plugins\/pdf-print\/images\/print.png\" alt=\"image_print\" title=\"Print Content\" \/><span class=\"pdfprnt-button-title pdfprnt-button-print-title\">Print<\/span><\/a><\/div><p><em><span style=\"font-weight: 400;\">A.J. Wilhelmi, CEO of the Illinois Health and Hospital Association, testifies before a legislative committee in March about impending cuts in federal Medicaid spending. (Capitol News Illinois photo by Peter Hancock)<\/span><\/em><\/p>\n<p><span style=\"font-weight: 400;\">By PETER HANCOCK<\/span><span style=\"font-weight: 400;\"><br \/>\n<\/span><span style=\"font-weight: 400;\">Capitol News Illinois<\/span><span style=\"font-weight: 400;\"><br \/>\n<\/span><a href=\"mailto:phancock@capitolnewsillinois.com\"><span style=\"font-weight: 400;\">phancock@capitolnewsillinois.com<\/span><\/a><\/p>\n<p><span style=\"font-weight: 400;\">SPRINGFIELD \u2014 Hospital officials in Illinois say they will have to make some difficult decisions in the next few years that could involve laying off staff, cutting back services and even closing some facilities entirely.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">That\u2019s the expected result of federal funding cuts built into the recently passed domestic policy bill that President Donald Trump signed into law July 4, a law that will cut federal spending on Medicaid by more than $1 trillion over the next 10 years.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">A.J. Wilhelmi, CEO of the Illinois Health and Hospital Association said in an interview with Capitol News Illinois that the financial pressures will fall heaviest on hospitals that serve rural areas, where a larger share of the population is covered by Medicaid.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">\u201cThe hospitals in these communities are already on the brink, based on some of the increases in labor, drug and supply costs coming out of COVID, a continuation of claim denials by payers and relatively flat reimbursement rates,\u201d Wilhelmi said. \u201cSo, all of that is creating significant pressures. And when you add these Medicaid cuts to an already challenging situation, we know that there are several hospitals that close because of these changes.\u201d<\/span><\/p>\n<p><b>Enrollment, reimbursement reductions<\/b><\/p>\n<p><span style=\"font-weight: 400;\">The new law contains provisions that are expected to reduce the number of people enrolled in Medicaid, particularly in states like Illinois that expanded eligibility for the program under the Affordable Care Act, the 2010 law commonly known as Obamacare.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Those include work requirements for people who enrolled through the expansion as well as requirements that they verify their continued eligibility for the program twice a year instead of annually.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">But the law also includes changes in aspects of the program that most people outside the health care industry never see. Those mechanisms \u2013 known as provider taxes and directed payments \u2013 affect the way states finance their share of the cost of Medicaid and the way they direct additional payments to certain health care providers such as hospitals.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Like many states, Illinois levies special taxes on certain health care providers, including hospitals. The money those taxes generate is used to draw down additional federal matching funds, then is paid back to the providers in the form of directed payments to increase their overall reimbursement rate and to reward them if they meet certain performance or quality standards.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Currently, IHA estimates the hospital tax generates about $2 billion a year in revenue. This past session, lawmakers <\/span><a href=\"https:\/\/ilga.gov\/Legislation\/BillStatus?DocNum=2771&amp;GAID=18&amp;DocTypeID=HB&amp;LegId=160810&amp;SessionID=114\"><span style=\"font-weight: 400;\">passed a bill<\/span><\/a><span style=\"font-weight: 400;\"> to increase the assessment in order to fund a 54% increase in hospital payments, subject to federal approval of the state\u2019s plan. But state lawmakers passed that bill before Congress passed Trump\u2019s domestic policy bill, dubbed the \u201cOne Big Beautiful Bill Act.\u201d<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Prior to passage of the new federal law, the tax rate states could levy was effectively capped at 6% of a hospital\u2019s net patient revenue. But under the new law, for states like Illinois that expanded Medicaid under the ACA, that cap will gradually be lowered by half a percentage point each year starting in 2028 until it reaches 3.5% in 2032.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">In addition, Wilhelmi said, the new law imposes a cap on the directed payments that expansion states like Illinois can send to hospitals so that the total does not exceed the maximum allowed under Medicare \u2013 the federal health insurance program for seniors, which has a lower reimbursement rate than Medicaid.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">\u201cAnd that will result in a significant reduction in Medicaid reimbursements for hospitals,\u201d Wilhelmi said. \u201cIt means literally hundreds of millions of dollars in less reimbursement to hospitals.\u201d<\/span><\/p>\n<p><b>$48 billion impact over 10 years<\/b><\/p>\n<p><span style=\"font-weight: 400;\">According to the nonpartisan health policy research organization <\/span><a href=\"https:\/\/www.kff.org\/medicaid\/issue-brief\/allocating-cbos-estimates-of-federal-medicaid-spending-reductions-across-the-states-senate-reconciliation-bill\/\"><span style=\"font-weight: 400;\">KFF<\/span><\/a><span style=\"font-weight: 400;\">, federal Medicaid spending in Illinois is expected to be reduced by about $48 billion over 10 years under\u00a0 the new legislation. That includes an <\/span><a href=\"https:\/\/www.kff.org\/policy-watch\/how-might-federal-medicaid-cuts-in-the-senate-passed-reconciliation-bill-affect-rural-areas\/\"><span style=\"font-weight: 400;\">estimated $6.73 billion<\/span><\/a><span style=\"font-weight: 400;\"> in spending cuts in rural parts of the state.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Democratic Gov. JB Pritzker has been harshly critical of the new law, and particularly the Medicaid cuts contained in it.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">\u201cDonald Trump isn&#8217;t just cutting health care \u2014 he&#8217;s also closing hospitals in Illinois and across the country with his latest scheme,\u201d Pritzker said in one <\/span><a href=\"https:\/\/x.com\/GovPritzker\/status\/1940543463940030484\"><span style=\"font-weight: 400;\">social media post<\/span><\/a><span style=\"font-weight: 400;\"> while the bill was moving through Congress. \u201cHard-working Illinoisans will spend more time in overcrowded waiting rooms and lose access to life-saving care.\u201d<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Wilhelmi, meanwhile, said there is still time before the cuts\u00a0 begin to take effect, and he is urging state officials to begin work immediately to develop strategies to adapt to the changes.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">\u201cI think the state will need to work with stakeholders like IHA and our hospitals, other provider groups, to identify creative options to ensure that the Medicaid program can continue to be that lifeline for vulnerable patients and communities,\u201d he said. \u201cAnd that will include identifying options to fortify those programs and services, as well as identify working with our congressional delegation on ways to mitigate or further delay these changes.\u201d<\/span><\/p>\n<p>&nbsp;<\/p>\n<p><a href=\"https:\/\/capitolnewsillinois.com\/\"><i><span style=\"font-weight: 400;\">Capitol News Illinois<\/span><\/i><\/a><i><span style=\"font-weight: 400;\">\u00a0is a nonprofit, nonpartisan news service that distributes state government coverage to hundreds of news outlets statewide. It is funded primarily by the Illinois Press Foundation and the Robert R. McCormick Foundation.\u00a0<\/span><\/i><\/p>\n<p>&nbsp;<\/p>\n","protected":false},"excerpt":{"rendered":"<p>A.J. Wilhelmi, CEO of the Illinois Health and Hospital Association, testifies before a legislative committee in March about impending cuts in federal Medicaid spending. (Capitol News Illinois photo by Peter [&hellip;]<\/p>\n","protected":false},"author":4,"featured_media":13984,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"_lmt_disableupdate":"","_lmt_disable":"","footnotes":""},"categories":[19],"tags":[],"class_list":["post-13979","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-local-news"],"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.4 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>Illinois Hospitals Fear Massive Cuts Under Trump Domestic Policy Law - Effingham&#039;s News and Sports Leader, 979XFM and KJ Country 102.3<\/title>\n<meta name=\"description\" content=\"Effingham&#039;s News and Sports Leader\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.thexradio.com\/news\/local-news\/13979-illinois-hospitals-fear-massive-cuts-under-trump-domestic-policy-law\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Illinois Hospitals Fear Massive Cuts Under Trump Domestic Policy Law - 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