Illinois now faces $5B in unpaid group insurance claims

As a result of years of budget turmoil in Illinois, the state now faces $5 billion in unpaid group insurance claims, according to the Chicago Tribune.

Providers are owed so much by the state that some are asking patients with full coverage from the state to pay bills upfront in their entirety, and some have simply stopped accepting insurance from state employees. The largest hospital network in Illinois, Downers Grove-based Advocate Health Care, cited the budget impasse reason for the hiring freeze it implemented this spring.

The State's Central Management Services, which operates the group insurance program, has not been able to pay providers since 2015. The claims earn between nine and 12 percent interest for each year they are not paid.

The state owes Cigna nearly $857 million in claims and interest, while Anthem subsidiary HealthLink Open Access Plan is owed over $778 million in claims and $56 million in interest. It is not only providers who are troubled by these developments, but also state employees who worry that their insurance's bad reputation will hurt their efforts to recruit top talent.

Kimberly Archer, a music professor and head of the faculty union at the University of Illinois-Edwardsville, said younger faculty will be dissuaded from applying to the university because of its poor benefits.

"'Why would I come here for $45,000 with health insurance that doesn't work and second-tier benefits?'" she said. "I think we haven't begun to see the long-term damage of this."

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