November 5, 2014

ILLINOIS HOSPITAL ASSOCIATION MEMORANDUM

TO: Chief Medical Officers, Member Hospitals and Health Systems Medical Executive Forum Chief Nurse Executives Chief Quality Officers

FROM: Derek J. Robinson, MD, MBA, FACEP, Executive Director The Institute for Innovations in Care and Quality Hospital Association

SUBJECT: IHA Summary of Nov. 4 Elections

Republicans had a very successful election day across the country, taking control of the U.S. Senate, increasing their majority in the U.S. House, and winning 24 of 32 gubernatorial races – including Illinois.

In one of the most closely watched and contentious gubernatorial races in the country, Republican challenger Bruce Rauner defeated incumbent Democrat Pat Quinn by more than 150,000 votes (50.6% to 46.0%). Governor Quinn has not yet conceded, saying he wants to see all votes counted.

Meanwhile, Democrats appear to be on their way to maintaining super majorities in both the and House, pending the final outcome of a few close races in the House.

Nationally, Republicans gained at least seven seats in the U.S. Senate, meaning that Republicans will control both chambers of the Congress in the final two years of President Obama’s Administration.

Here are further details on key Nov. 4 election results:

Other Statewide Offices Republican incumbent Comptroller defeated her Democratic challenger Lt. Governor Sheila Simon to win re-election. As expected, Democrats Attorney General Lisa Madigan and Secretary of State Jesse White coasted to victory in their re-election bids. In the race for Treasurer between Republican State Representative Tom Cross and Democratic State Senator Mike Frerichs, it was still too close to call this morning, with Cross holding a lead of less than 20,000 votes out of 3.3 million votes cast.

Illinois General Assembly It appears that Democrats have retained super majorities in both the House and Senate, enabling both chambers to override gubernatorial vetoes. In the House, Democrats will hold a super majority margin of 71 to 47, if Democrats prevail in a few races still too close to be called. In the Senate, Democrats will have a 39 to 20 margin, maintaining their super majority, with Republicans picking up one seat.

Illinois Supreme Court Retention Whether Justice Lloyd Karmeier is retained for another 10-year term on the state Supreme Court is still too close to be called, with the latest vote tally indicating he is just barely above the necessary 60% retention requirement.

Illinois Congressional Delegation and U.S. Congress Democrat won re-election for another term as the senior U.S. Senator from Illinois (53.2% to 43.0% over Republican challenger Jim Oberweis).

In the U.S. House, there were two highly contested races in Illinois. Republican challenger Bob Dold defeated incumbent Democrat in the 10th District, while Republican challenger State Representative defeated Democrat William Enyart in the 12th District. Democrats will now hold a 10 to 8 margin in the Illinois Congressional Delegation.

Nationally, Republicans will continue to control the U.S. House, increasing their majority margin by at least 14 seats (243 to 175 with more than a dozen races still undecided). In the U.S. Senate, Republicans gained at least seven seats, for a majority margin of at least 52 to 45 (with a few races still to be determined).

Implications for Hospitals and Health Care

In Illinois Governor-elect Rauner and the General Assembly will face several complex and daunting challenges as they head back to Springfield in the coming months. If the General Assembly and Governor do not take action to maintain the current state income tax rates beyond Dec. 31, the state would face a cut in revenues upwards of $6 billion in the new fiscal year that starts July 1, 2015, creating significant vulnerabilities and potential budget cuts.

Depending on the outcome of the state Supreme Court’s ruling on challenges to a pension reform law, the General Assembly may also face the prospect of having to enact new pension reform legislation.

IHA will continue working with the state’s leaders to find and implement workable solutions that provide critical support to Medicaid and health care. We will continue to emphasize the importance of the state supporting health care services that Illinoisans need and depend on. In addition, IHA will aggressively advocate for state resources that will enable hospitals and health systems to continue caring for their communities and transforming the state’s health care delivery system.

In Congress In the coming months, there will be mounting pressure in Congress to reduce the federal deficit, raise the debt ceiling and again fix the Medicare Sustainable Growth Rate (SGR) physician payment formula, making Medicare and Medicaid a prime target for substantial cuts and drastic changes. With Republicans controlling the Senate and the House in the new Congress, there may be efforts to link and package health care funding cuts and program changes, as well as revisions to the health care reform law, with critical budget and other issues to negate the possibility of Presidential vetoes.

IHA will continue to work to oppose any further health care funding cuts, as well as to alleviate or reform burdensome and harmful Medicare regulations, including the Two-Midnight Rule, the 96-Hour Rule, the Direct Supervision Requirement and the 3-day inpatient hospital stay requirement for a Medicare-covered skilled nursing stay.

Moving Forward With the elections behind us, IHA will continue to work diligently with our elected officials in Washington, D.C. and Springfield toward the goal of implementing sound health policy that ensures access to care for all residents of Illinois. We urge you to reach out to your legislators who were successful last night and congratulate them on their hard-fought victory. Staff at IHA will continue to build strong working relationships with policy makers at the state and federal level and advocate on your behalf so you can fulfill your mission of providing quality health care to individuals throughout your communities.