{"id":717457,"date":"2026-06-21T13:55:11","date_gmt":"2026-06-21T13:55:11","guid":{"rendered":"https:\/\/www.newsbeep.com\/us\/717457\/"},"modified":"2026-06-21T13:55:11","modified_gmt":"2026-06-21T13:55:11","slug":"illinois-hospitals-owe-the-state-more-than-700-million","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/us\/717457\/","title":{"rendered":"Illinois hospitals owe the state more than $700 million"},"content":{"rendered":"

When West Suburban Medical Center closed in March<\/a>, it didn\u2019t just leave patients in a lurch; it also left the state high and dry.\u00a0<\/p>\n

Around the time of its closure, the Oak Park hospital owed the state more than $51 million in taxes and penalties, along with $20 million that the state had advanced to help stabilize West Suburban and its sister facility, Weiss Memorial Hospital in Chicago\u2019s Uptown neighborhood.<\/p>\n

Now that both hospitals are shuttered, it\u2019s unclear whether the state will get those dollars back \u2014 a situation that has intensified debate among Illinois politicians and hospital leaders about how much taxpayer money the state should spend to help safety net hospitals, especially if those hospitals might not pay the state back or are poorly rated. <\/p>\n

It\u2019s a debate that strikes at the heart of how healthcare is funded and delivered in Illinois, with implications for patients across the Chicago area. Gov. JB Pritzker signed a bill into law this week aiming to address some of the issues, but concerns persist.<\/p>\n

Across Illinois, 19 hospitals \u2014 mostly safety net hospitals like West Suburban and Weiss \u2014 owed the state nearly $705 million in taxes, penalties and advance payments, as of earlier this year, according to information obtained from the Illinois Department of Healthcare and Family Services through Freedom of Information Act requests.\u00a0<\/p>\n

\u201cIt\u2019s really pretty alarming on a lot of fronts, the total dollar amounts involved,\u201d Sen. Chapin Rose, the chief budget negotiator for Illinois Senate Republicans, told the Tribune, emphasizing the need for more transparency and rules. \u201cWe keep underwriting hospitals that are literally going out of business and the taxpayers are left holding the bag.\u201d\u00a0<\/p>\n

Safety net hospital leaders, however, say the debts are symptomatic of the challenges they face in\u00a0serving vulnerable communities that rely on the facilities for care and employment. <\/p>\n

Patients say they depend on the hospitals to keep them healthy.<\/p>\n

\"AA patient arrives at the emergency department at Humboldt Park Health hospital in Chicago on June 16, 2026. (Josh Boland\/Chicago Tribune)<\/p>\n

Patient Mary Anne Cruet said she trusts Humboldt Park Health \u2014 a safety net hospital that owed the state more than $6.2 million as of earlier this year \u2014 with her life. She\u2019s continued to travel to the hospital for monthly infusions even after she moved away from Humboldt Park about two years ago.<\/p>\n

\u201cI really need to be at a place where they know what they\u2019re doing,\u201d said Cruet, 57, who, like many of the hospital\u2019s patients, is on Medicaid. If the hospital weren\u2019t there, she said, \u201cwhere would the people go?\u201d<\/p>\n

Safety net hospitals don\u2019t just help their community members; they bolster the entire healthcare ecosystem in Chicago, said Dr. Ngozi Ezike, president and CEO of Sinai Chicago. Safety net hospitals serve large numbers of patients on Medicaid, a state and federally funded health insurance program for people with low incomes and disabilities.<\/p>\n

If the city\u2019s safety net hospitals were to close because of a lack of funding, their patients would fill other hospitals\u2019 waiting rooms \u2014 leading to longer waits and problems accessing healthcare across the city, she said.<\/p>\n

\u201cWe have to understand how important these safety net hospitals are,\u201d Ezike said. \u201cThe other hospital systems, the major academic medical centers, can\u2019t be what they are if the safety nets aren\u2019t doing what we\u2019re doing.\u201d\u00a0<\/p>\n

A spokesperson for Dr. Manoj Prasad, an owner of West Suburban Medical Center, declined to comment for this article.<\/p>\n

\u2018We just can\u2019t afford it\u2019<\/p>\n

The money safety net hospitals owe Illinois falls mainly into two categories: unpaid hospital assessments, also known as provider taxes, and advance payments.<\/p>\n

To help support their Medicaid programs, most states, including Illinois, levy taxes on hospitals. Illinois uses the money collected from the tax to draw down additional matching dollars from the federal government. Those combined funds are then distributed to hospitals based on the number of services they provide to people on Medicaid.<\/p>\n

Of the $705 million hospitals owed the state, about $478 million of that was from unpaid hospital assessments and related penalties, as of March.\u00a0<\/p>\n

When hospitals don\u2019t pay their assessments, Illinois must use state dollars to fill the gap \u2014 money that could have otherwise gone elsewhere, a spokesperson for the governor\u2019s office said in a statement.<\/p>\n

The second area where hospitals owe Illinois money is through advances. In Illinois, some hospitals, including those that serve many patients on Medicaid, have been able to ask the state for advances when they experience financial emergencies, but that money is supposed to be paid back over time.\u00a0<\/p>\n

As of late February, Illinois hospitals owed the state nearly $227 million in advance payments.\u00a0\u00a0<\/p>\n

For both advances and late hospital assessment payments, hospitals can enter into repayment plans with the state. If they violate the terms of those plans, the state can withhold certain dollars.<\/p>\n

As of February, two of the 15 Illinois hospitals and health systems that owed the state advance payment money were in compliance with the terms of their repayment agreements, according to information obtained from the Illinois Department of Healthcare and Family Services through a Freedom of Information Act request. As of late April, four of the 12 hospitals that owed the state tax money were fully in compliance.<\/p>\n

The Department of Healthcare and Family Services \u201chas appropriately pursued these outstanding taxes,\u201d the governor\u2019s office said in a statement.<\/p>\n

Leaders of safety net hospitals say they appreciate being able to enter into\u00a0repayment plans for the dollars, which are important to their survival. Entering into repayment plans\u00a0has given Sinai Chicago a little breathing room, Ezike said.\u00a0<\/p>\n

As of earlier this year, Sinai Chicago owed more than $125.7 million in provider taxes and penalties and $51.5 million in advance payments \u2014 the largest debt in the state. The system includes Mount Sinai Hospital, Holy Cross Hospital and Schwab Rehabilitation.\u00a0<\/p>\n

About 70% of Sinai Chicago\u2019s patients are on Medicaid, according to the system, and it\u2019s one of the largest safety net providers in Chicago, with more than 650 beds across its three hospitals.<\/p>\n

\"AA bicyclist rides past Mount Sinai Hospital, June 16, 2026, in Chicago. (Josh Boland\/Chicago Tribune)<\/p>\n

\u201cIf I don\u2019t pay the pharmaceutical company, they\u2019re not going to deliver the medicines,\u201d said Ezike, who before joining Sinai Chicago was director of the Illinois Department of Public Health under Pritzker. \u201cIf I don\u2019t pay staff I won\u2019t have anybody to care (for patients), so being able to work with the state \u2014 and the state has been an incredible partner understanding our pressures \u2014 has given us opportunities to defer some of those payments, knowing that they\u2019re on our books.\u201d<\/p>\n

Sinai was in compliance with the terms of its repayment agreements with the state as of earlier this year, according to the Department of Healthcare and Family Services.<\/p>\n

Safety net hospitals don\u2019t want to fall behind on hospital assessment payments, said Jose Sanchez, president and CEO of Humboldt Park Health. But sometimes, they have little choice, said Sanchez, who is also chair of a safety net hospital association in Chicago. <\/p>\n

Humboldt Park Health was in compliance with the terms of its hospital assessment repayments as of late April, but not in compliance with the terms of its repayment agreement for advances as of February. Humboldt Park entered into a new repayment plan with the state for its advances this month, Sanchez said.<\/p>\n

\u201cI don\u2019t think that any safety net hospital deliberately says, \u2018We are not going to pay the provider tax,\u2019\u201d Sanchez said. \u201cI think we make decisions based on what are the priorities \u2026 and the priorities are staff, supplies, drugs and creating a safe environment.\u201d<\/p>\n

Safety net hospital leaders say cost pressures are intense and unrelenting.\u00a0<\/p>\n

For one, Medicaid payments do not cover the full cost of care, they say. The costs of supplies, medications and staffing also continue to grow. In 2025, the costs hospitals in the U.S. faced grew 7.5% while\u00a0the prices they were able to charge increased 3.3%, according to an American Hospital Association report<\/a>.\u00a0<\/p>\n

Safety net hospitals also have fewer resources than more affluent hospitals to deal with denials from Medicaid managed care organizations, which occur when health insurers and other organizations that administer Medicaid benefits for the state deny payment for certain claims.\u00a0<\/p>\n

\u201cHospitals like Roseland are not failing, we\u2019re being financially squeezed from every direction,\u201d said Roseland Community Hospital President and CEO Tim Egan. \u201cAll of our expenses since COVID have gone up exponentially. \u2026 We just can\u2019t afford it.\u201d<\/p>\n

\"RoselandRoseland Community Hospital President and CEO Tim Egan speaks to the media as U.S. Sen. Dick Durbin visits the hospital on July 11, 2025, to highlight the threats to safety net hospitals in Illinois. (E. Jason Wambsgans\/Chicago Tribune)<\/p>\n

Roseland, located on the Far South Side, owed $22.5 million in hospital assessment payments and penalties and nearly $10.7 million in advance payments as of earlier this year. It was not in compliance with the terms of its repayment plans, as of earlier this year.<\/p>\n

Recently, Roseland has been scrambling to make payroll after it didn\u2019t receive its Medicaid managed care organization payments as early as usual, Egan said.<\/p>\n

A spokesperson for the Illinois Department of Healthcare and Family Services said in a statement that the department is still getting money to the managed care organizations within the timeframe required by law, and any payments received later than usual, but still within the required time frame, were because the department \u201cwas giving the hospitals one last chance to make tax payments rather than recoup funding.\u201d<\/p>\n

Egan called the situation \u201ca living cash flow hell\u201d in a message to the Tribune on Friday and said the \u201cdoors of Roseland Hospital are in Gov. Pritzker\u2019s hands. JB can keep them open or slam them shut forever.\u201d<\/p>\n

The governor\u2019s office said in a statement: \u201cThe State of Illinois has already provided intensive financial and operational support for Roseland Hospital. Roseland is ultimately a private facility whose leadership is responsible for the operations and finances of their facility.\u201d<\/p>\n

Dr. Khurram Khan, chief medical officer at Roseland, said the hospital is needed. On a recent day, the hospital had 21 patients in its inpatient psychiatric ward and another three or four waiting in the emergency department to be admitted into the unit, he said. In recent weeks, all 10 of its intensive care unit beds were full, Khan said, and Roseland still has an obstetrics unit, though other hospitals have shuttered their OB units in recent years<\/a>.<\/p>\n

\u201cWe have one of the only OB departments on the South Side of Chicago delivering babies for the Medicaid population,\u201d Egan said. \u201cAll of that is coming out of our inadequate budget because we believe it\u2019s immoral not to provide that service for the community we serve.\u201d<\/p>\n

Changing the law<\/p>\n

Some leaders and lawmakers believe the state needs to rethink the way it supports care for Illinois\u2019 most vulnerable communities, given safety net hospitals\u2019 continuing financial struggles.<\/p>\n

Addressing the problem with short-term funding won\u2019t work forever, said David Smith, founder and CEO of Third Horizon, a Chicago-based data advisory firm that released a report last year warning that Chicago\u2019s healthcare safety net system is on \u201cthe verge of collapse.\u201d<\/p>\n

\u201cWe need to support these institutions \u2014 but at some point the math stops working and the state will not have the capital, the resources necessary to keep this system viable,\u201d Smith said.<\/p>\n

On the last day of the legislative session, as lawmakers prepared to pass a $55.9 billion state budget, Sen. Dave Syverson, R-Cherry Valley, raised questions on the Senate floor about the allotment of $118 million in grants to safety net hospitals. Each year, state leaders\u00a0decide whether to give grants \u2014 which are separate from the advances some facilities receive \u2014 to safety net hospitals to support their work.\u00a0<\/p>\n

But for some lawmakers, the advances and taxes owed to the state by safety net hospitals cast a shadow over any discussion about giving safety net hospitals grant dollars.<\/p>\n

\u201cOur concern is that we have $700 million of unpaid taxes and fees and penalties from these hospitals, and I\u2019m concerned that we\u2019re still continuing down that same path, which is going to end up hurting both health outcomes and hurting our overall Medicaid system,\u201d Syverson said on the Senate floor.\u00a0<\/p>\n

Sen. Elgie Sims Jr., a Chicago Democrat, responded, emphasizing the importance of safety net hospitals as both employers and healthcare providers in their communities.<\/p>\n

\u201cIt\u2019s very easy for us to look at a spreadsheet and say, \u2018This is not right,\u2019\u201d Sims said, but he said safety net hospitals care for people who might otherwise be turned away from other hospitals because they\u2019re uninsured or on Medicaid.<\/p>\n

Lawmakers ultimately passed a budget containing the $118 million\u00a0in grants for safety net hospitals, which do not have to be repaid.<\/p>\n

At the end of this past session, lawmakers also passed a Medicaid omnibus bill putting guardrails around some of the financial support hospitals receive from the state. The legislation, which Pritzker signed into law this week, creates a loan program for distressed hospitals that will replace the current system of giving the hospitals advances.<\/p>\n

With deep Medicaid cuts looming<\/a> because of the federal One Big Beautiful Bill and some hospitals closing, \u201cthe State of Illinois must take every possible step to protect Medicaid funding and be responsible stewards of taxpayer dollars,\u201d a spokesperson for the governor\u2019s office said in a statement.<\/p>\n

Under the new law, a hospital seeking a loan from the state will first have to submit a plan outlining how it plans to use the dollars. The state Department of Healthcare and Family Services will then evaluate the plan and determine that there is a \u201creasonable likelihood\u201d the hospital would be able to stay open and repay the loan if it got the money.<\/p>\n

Hospitals will not qualify for loans from the state if they owe hospital assessment payments or advances and are delinquent on their repayments. <\/p>\n

If a hospital fails to comply with the repayment terms of the loan, the rest of the money owed will \u201cbe immediately recouped\u201d from other types of dollars the hospital otherwise receives, according to the new law. Any unpaid loan will become a lien against the hospital\u2019s assets.<\/p>\n

The new law will also require all hospitals to submit certain financial reports to the state annually.<\/p>\n

Bill sponsor Rep. Anna Moeller, an Elgin Democrat, said the legislation wasn\u2019t necessarily inspired by any one hospital. \u201cIt\u2019s trying to strike a balance between making sure we\u2019re helping our distressed hospitals stay afloat and also creating accountability,\u201d Moeller said.<\/p>\n

The new law, however, faces criticism from those on multiple sides of the debate.<\/p>\n

Syverson is concerned that the new law doesn\u2019t define what it means for a hospital to have a \u201creasonable likelihood\u201d of being able to repay a loan from the state, and he worries that if a hospital closes, the state would be last in line to get its money back.<\/p>\n

\u201cMy concern (is) that this is just another way to advance money to hospitals,\u201d Syverson said. \u201cAt some point we have to start looking at maybe repurposing some of these hospitals,\u201d he said, given that some safety net hospitals have unfilled beds.<\/p>\n

As healthcare evolves, it might make sense to use the facilities to offer more mental health care or long-term care rather than have them all continue to operate as traditional hospitals, Syverson said.<\/p>\n

Roseland\u2019s Egan, however, said hospitals like Roseland save lives. He said that although he\u2019s happy to share the hospital\u2019s finances and strategic plans with the state, he\u2019s concerned the new law could, in some ways, make it even tougher to get by.<\/p>\n

\u201cNow is the time to bolster us, invest in us and save us,\u201d Egan said. \u201cYou\u2019re just making it harder and harder for us to survive.\u201d<\/p>\n

\"CharmaineCharmaine Jones, 65, at her home in Waukegan on June 17, 2026. \u201cThey saved my life,\u201d Jones said. \u201cI\u2019m not changing my hospital. They got me through a lot, and I appreciate that.” Jones moved to her current home in Waukegan but continues to take public transportation to Mount Sinai Hospital for all of her healthcare needs. (Josh Boland\/Chicago Tribune)<\/p>\n

Charmaine Jones, a patient at Mount Sinai, said she also hopes the state continues to help safety net hospitals survive.<\/p>\n

Jones, 65, has continued to receive care at Mount Sinai, on the city\u2019s West Side, despite moving to Waukegan. At one point, she took a Metra train from Waukegan into the city five times a week to get radiation at Mount Sinai, after she was diagnosed with breast cancer about a year ago.<\/p>\n

\u201cI\u2019m not changing my hospital,\u201d Jones said. \u201cThey got me through a lot, and I appreciate that. The people that work there they\u2019re always nice, kind, smiling, willing to help, willing to go the extra mile.\u201d<\/p>\n

She disagrees with those who question whether safety net hospitals are a good investment for the state.<\/p>\n

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