As expected, Gov. Pat Quinn on Friday signed into law a measure authorizing state government to borrow more than $500 million so it can initiate a complex plan to send hospitals an infusion of federal dollars.


 

As expected, Gov. Pat Quinn on Friday signed into law a measure authorizing state government to borrow more than $500 million so it can initiate a complex plan to send hospitals an infusion of federal dollars.

Quinn's signature on House Bill 1027 means hospitals will start collecting the extra money within days, according to backers of the legislation.

The new law enables state government to borrow $510 million from two special funds: $335 million from a fund dealing with the retirement of general obligation bonds and $175 million from the State Employees' Retirement System fund.

State government needs the borrowed cash to put up the initial funding required to kick-start a five-year "hospital assessment" program.

Through a complicated series of money transfers, the assessment program leverages additional federal dollars to pay for health care for people on Medicaid. By the end of the five-year period, the program will generate an extra $4.5 billion for hospitals and state government.

The program is expected to bring in about $10.5 million a year at OSF Saint Francis Medical Center in Peoria and about $11 million a year at St. John's Hospital in Springfield, officials at those facilities said.

Under the new law, the borrowed $500 million plus interest will be repaid to the special state funds by April 14.