Audit finds many were improperly enrolled in state health care program for noncitizens, while costs were vastly underestimated

SPRINGFIELD — Gov. JB Pritzker’s administration vastly underestimated the cost and attraction of a pair of controversial programs that provide state-funded health insurance for immigrants who are not citizens, according to an audit report released Wednesday.

The programs have cost the state more than $1.6 billion since the initiative began in late 2020 and also have been plagued by improper enrollments and a failure to move some recipients who were eligible into Medicaid, the traditional health insurance program for the poor that is jointly funded by the federal government, according to the report from Illinois Auditor General Frank Mautino’s office.

While widely supported by the Latino caucus in Springfield and other progressive lawmakers, the programs have been a source of tension among the Democrats who control the legislature and briefly derailed budget negotiations two years ago before legislators reached a compromise that gave Pritzker broad latitude to rein in costs.

The audit’s release comes a week after the governor proposed eliminating funding beginning July 1 for the program that insures people younger than 65, a move his administration estimates would save $330 million and help erase a state budget deficit for the coming year it once estimated at more than $3 billion.

The cost overruns were particularly pronounced in the program meant for recipients ages 42 to 64, with the actual expenditure of $485 million through the three years ending June 30, 2023, the period covered by the audit, coming in at nearly four times the initially estimated cost of $126 million, according to the report. During the same period, the actual cost of the program for those 65 and older was $412 million, nearly double the original projection of $224 million.

At a news conference in Chicago on Wednesday to announce another round of medical debt relief for Illinois residents, Pritzker did not answer directly when asked why the estimates his administration used for the programs were so far off. Instead, he said some individuals were at times kept on the programs’ rolls for a period before the state determined they were no longer eligible, either because of a change in immigration or employment status or some other factor.

Despite his proposal to do away with funding for coverage of those under 65, Pritzker reiterated his support for universal health care coverage in a form he didn’t specify.

“The broader context is people need to get health care,” Pritzker said. The popularity of the immigrant health care programs, and the ensuing high costs to the state, provide “some evidence, anyway, that there are an awful lot of people out there that need coverage who aren’t getting it or who will do anything to get it, and I think that’s a sad state of affairs in our society.”

As of December, there were 41,505 people enrolled in the two immigrant health care programs. Roughly 80% of them were in the program for younger immigrants.

The audit notes that when the program was created in 2020 for immigrants 65 and older who were in the country without legal permission or did not yet qualify for a green card, lawmakers and the Department of Healthcare and Family Services relied on advocacy groups for cost estimates.

The initial estimate, according to emails turned over to the auditor general, was that the program would cost $4 million annually, which one agency official later described as “very wrong.” The program ended up costing more than $67 million in its first seven months.

Still, it was expanded twice in 2022, lowering the eligibility age to 42. Together, the two programs do not extend to the asylum-seekers who’ve arrived in Chicago in recent years from the southern border.

In the first year both programs operated, “estimates were made with little experiential data to accurately predict program growth,” Healthcare and Family Services spokeswoman Melissa Kula said in an emailed statement. The estimates, based on cost and enrollment growth in traditional Medicaid, fell short in part because of higher rates of chronic disease and hospitalization among the populations served by the state programs, Kula said.

Despite efforts to improve projections, enrollment and costs continued to far outstrip estimates. By mid-2023, enrollment in the programs was roughly double what was expected.

Wednesday’s report was ordered by the Legislative Audit Commission, a bipartisan panel of House and Senate members that oversees the auditor general’s work.

State Rep. Fred Crespo, a Democrat from Hoffman Estates who co-chairs the commission, said that while the findings were expected, they should serve as a lesson in how the state needs to be more fiscally responsible in its budgeting.

“I was taken aback by the sheer cost and the underestimates, and I think that’s really a reflection on how we do business in the state,” said Crespo, a moderate who declined to say where he stands on the programs. “If you present a bill and you don’t have a handle on the cost, or in this case enrollment, this is going to blow up in your face.”

Nevertheless, funding the programs should continue to be a priority in order to provide adequate health care for noncitizens who pay taxes just like other Illinois residents, said Rep. Lilian Jimenez, a Chicago Democrat.

“When we’re talking about what the Illinois budget should include, I think we just have to think about, Are we unfairly excluding folks from programs that they would normally be eligible for but for the federal government’s decision to not provide people with Social Security numbers?” Jimenez said. “When we talk about health care for all, when we talk about health care as a human right, does it include everybody, or is there a carve-out? Does Illinois have a carve-out for who is entitled to health care and who is not?”

Republicans were quick to criticize Pritzker over the audit’s findings, some even going as far as alleging fraudulent activity, though the auditor general’s review was focused on internal processes and made no specific findings of fraud in the programs. Senate GOP leader John Curran of Downers Grove dismissed the programs as a “good press pop” for a Democratic governor seeking national attention.

Sen. Chapin Rose, a Republican who co-chairs the audit commission with Crespo, accused Pritzker and his administration of “complete mismanagement” of the programs and also criticized the administration for downplaying their cost.

“This is insane. Every time you turn around, he’s telling us, ‘Oh, don’t worry about it. It’s not going to cost that much money.’ And then a couple years later, you find, ‘Oh, once again, he’s wrong on his numbers,’” said Rose, of Mahomet. “Transparency is everything. You’ve got to be able to believe budget estimate numbers.”

Aside from inaccurate projections of the programs’ cost and the number of people who would sign up, the audit uncovered numerous apparent problems with their rolls, including nearly 500 duplicate enrollments; more than 6,000 enrollees with Social Security numbers who were designated as “undocumented”; nearly 700 people registered for the program for those 65 and older who were too young; and nearly 400 participants who had coverage despite being eligible for Medicaid, under which the federal government would share the cost.

Among the “undocumented” participants who also had Social Security numbers, the Department of Healthcare and Family Services reviewed a sample of 94 cases and found 19 who “should have been recorded in the system as lawfully present or as being a legal permanent resident,” according to the audit, which would have made them eligible for Medicaid after five years in the country.

As for the participants who appeared to already be eligible for Medicaid, the department reviewed 17 cases and found 13 people who were incorrectly approved for the programs paid for solely by the state.

The audit noted that about a quarter of the people signed up for the 65-and-over program who appeared to be too young were allowed to enroll because they were within three months of their 65th birthday, while other instances were due to incorrect birthdates provided during registration.

Rep. Norine Hammond of Macomb, lead budget negotiator for the House GOP, questioned the competence of those tasked with running the health care programs.

“Let’s be clear and let’s be transparent. We have to have the truth. If we can’t base our budgets and our priorities on truthful numbers, then what are we doing here? It makes absolutely no sense,” she said. “Who’s processing these applications? And what are they doing that they can’t do it correctly?”

The auditor general’s office recommended Healthcare and Family Services work with the Department of Human Services to review eligibility data and create processes “to ensure ineligible individuals are not enrolled” and “to remove any unnecessary duplicate enrollees to ensure fraudulent or duplicate payments are not made on their behalf.”

The office also recommended that the Healthcare and Family Services department “seek federal reimbursement for any federal match lost due to the miscategorization of … enrollees who were otherwise eligible for federally funded programs.”

While the department accepted the recommendations, the latter could be a tall order given Republican President Donald Trump’s hardline stance on immigration and his administration’s threats to withhold federal funds from states such as Illinois that resist federal deportation efforts.

Separate from the audit, Healthcare and Family Services has started a redetermination process for the programs, which were created at a time during the COVID-19 pandemic when the federal government had paused annual checks to verify whether enrollees were eligible for Medicaid.

Last year, the governor announced plans to cut as many as 6,000 health care recipients across the two programs to save money.

As of last month, more than 21,000 people had been dropped from the rolls through the process, more than half of them for not responding to the department’s communications. Almost 8,000 more were removed after becoming ineligible for reasons including earning too much money, moving out of state or dying, while nearly 1,500 moved into other programs for which they were qualified.

Petrella reported from Chicago. Chicago Tribune’s Olivia Olander contributed.

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