Three local hospitals will receive a share of $510 million in Medicaid funding, which is provided by state tax dollars and is being distributed throughout Illinois, said Danny Chun, spokesman for the Illinois Hospital Association.

House Bill 1027 will pump more than half a billion dollars into the Medicaid system, which will be matched by the federal government, Chun said. Once the money is put into the health care system, it will send tax dollars back to the state. This will create a surplus, which will then be used to fund Medicaid, Chun said.

About $14 million is being allocated to local hospitals; about $8 million is going to Carle Foundation Hospital, 611 W. Park St., Urbana; about $5 million is going to Provena United Samaritans, 812 N. Logan Ave., Danville; and about $1 million is going to Provena Covenant Medical Center, 1400 W. Park St., Urbana.

“This is a very positive development for the community,” Chun said. “People who would otherwise be unable to receive health care because they lost their jobs can now receive treatment.”

The program covers patients who do not have a private insurance carrier. The people receiving aid from the program are usually low income, disabled or elderly. Under the program, they go to the hospitals and receive treatment, and the hospital pays for it, Chun said.

Rob Tonkinson, chief financial officer for Carle Hospital, said Medicaid is not without its problems.

“Medicaid payments, including these supplemental payments from the Provider Tax Program, do not cover the cost of the services provided,” Tonkinson said. “This is a long-standing and consistent problem with Medicaid payments, both in Illinois and around the country.”

Tonkinson said that the difference in payments to Carle and Provena is due to how their respective administrations figure into a formula set up by the law that measures the size of the hospital and the population of its surrounding area.

“The state determined how much each community and each hospital within each community would receive through a formula established under federal law,” Chun said, “It is laid out in the legislation.”

The half a billion dollars that is being distributed statewide is part of $4.5 billion of Medicaid funding that will be distributed statewide in the next five years, Chun said.

Even with an increase in Medicaid funding to hospitals, some students think the system needs reform.

“There needs to be more tax dollars put towards Medicaid,” said Emily Dabe, sophomore in LAS. “Either that or there needs to be some kind of major reform.”

This is one step toward improving the imperfect Medicaid problem, but Tomkinson said it will not completely solve the problem.

“Losses from providing services to Medicaid patients have grown historically each year,” Tonkinson said. “We expect those losses to continue to grow in the future.”