Illinois Medicaid Honored with 2022 NAMD Spotlight Award

The Illinois Department of Healthcare and Family Services is a national leader in rate reform focused on reducing health disparities.  Even before the COVID-19 pandemic, leaders in Illinois had their eye on nursing home reform to reduce health disparities particularly in historically underserved Black and Brown communities, and in facilities serving high percentages of Medicaid members. The Department engaged in wide-scale nursing facility rate reform including the creation of a value-based payment incentive directly linked to quality of care, staffing levels, and resident outcomes. The law, signed in May 2022 and made effective July 2022, marks the first time in Illinois that funding for the nursing home industry ties directly to quality.

A Crisis of Disparities

To make their case for reform, the Illinois Department of Healthcare and Family Services clearly demonstrated that nursing home rate setting is a health disparities issue. In their analysis, “40 percent more Black and Brown Medicaid customers in nursing facilities perished than would be expected based comparative COVID-19 mortality rates among White nursing facility residents.” Illinois Medicaid pays $2.5 billion for approximately 60 percent of all nursing facility days in the state – making it a strong engine to drive equitable, accountable rate reform. The Department was committed to transparency as they developed the case for legislation to drive reform. A new Nursing Home Payment Reform web page shared data, analysis, testimony, and countered opposition talking points with facts.

A Model for Change

Comprehensive nursing home reform is not easy and typically faces significant, entrenched opposition. The process in Illinois took more than two years of regular stakeholder engagement, targeted and persistent legislative outreach, and frequent negotiations with opponents. The pandemic’s disproportionate burden on Medicaid members added urgency to a sustained and strategic policy development process. The Department worked closely with federal CMS partners to ensure their support and input along the way. The strong state-federal alignment is evident in how much of Illinois’ legislation is echoed in federal nursing home quality priorities. It’s a recognized national model.

Read the White House statement here: FACT SHEET: Protecting Seniors by Improving Safety and Quality of Care in the Nation’s Nursing Homes – The White House]

Expected Impact

Champions of the legislation expect this type of accountability program to net positive outcomes for residents, providers, and facilities. Attaching new funding for the nursing home industry to quality of care for residents is expected to improve resident health and quality of life.  Since staffing is a known leading indicator of nursing facility resident outcomes, legislation focused on incentives is expected to improve quality. A new certified nursing assistant wage scale allows facilities to apply for funding that allows for experience-based pay increases. Participating facilities can reap the long-term benefits of attracting and retaining quality staff to care for residents. The Department also sees a win in the reform. New data sharing avenues between the state agencies of health and public health and new shared analytics will assist with unwinding the public health emergency.

NAMD is pleased to honor the Illinois Department of Healthcare and Family Services with the 2022 Spotlight Award. Learn more about the other 2022 Spotlight Award winners here.