Appeal from the Circuit Court of Cook County, the Hon. Albert
S. Porter, Judge, presiding.
Rehearing denied May 27, 1983.
On January 19, 1983, plaintiffs, Burl Warrior, Robert Davis, Monica Deandrade and Katherine Collins, who describe themselves as "recipients under the Aid to the Medically Indigent Medical Program," filed this action in the circuit court of Cook County "on behalf of themselves and all others similarly situated" against the Governor of Illinois, the Illinois Department of Public Aid, and its Director, Jeffrey C. Miller. Plaintiffs Warrior and Collins also allege that they are "recipients of the General Assistance (`G.A.') Medical Program." The Illinois Hospital Association and several individually named hospitals, the County of Cook and the city of Chicago were granted leave to intervene.
In December 1982, the General Assembly enacted, and the Governor approved, the Emergency Budget Act (Pub. Act 82-1038, S.B. 1652), which authorized the establishment of contingency reserves in the funds appropriated for fiscal year 1983. Insofar as pertinent to this litigation it authorized the Governor to designate as a contingency reserve an amount no greater than 2% of the total appropriations of the agencies and departments under his jurisdiction.
On January 19, 1983, the Department of Public Aid, effective February 1, 1983, for a maximum of 150 days, adopted Emergency Rule sections 150.10, 150.20, 150.30, 150.40, 150.50, 150.60, 150.70, 150.80 and 150.90. Section 150.20 provides that because funds which were to have been used after January 1983 to pay for benefits for Aid to the Medically Indigent (AMI) (Ill. Rev. Stat. 1981, ch. 23, par. 7-1 et seq.) have been reserved and are therefore unavailable for payment, "the Department shall not pay for medical services rendered on and after February 1, 1983 under the AMI program * * *." The rule provides that persons who have been determined eligible for the program shall be maintained on the rolls and their eligibility periodically redetermined, that new applications shall be processed but that medical eligibility cards shall not be supplied during the period. It further provides that if the General Assembly "shall subsequently enact a subsequent specific appropriation for the purpose of funding AMI services, medical eligibility cards or other indicia of eligibility for AMI benefits shall promptly be supplied to persons then eligible for AMI and the benefits shall continue to be provided as long as such subsequent legislation shall permit."
Section 150.40 of the emergency rule effects a change in the regulation covering payment for inpatient hospital services. It provides that under the General Assistance Medical Program hospital bills will be paid only up to $500 per admission, "the client being financially responsible for costs over this amount up to an amount the Department would otherwise pay according to its rates; * * *." It also lists a number of drugs which no longer are included in the Department's drug formulary and for which no payment will be made to the providers.
Section 150.70 provides that hospital rates established under Public Act 82-787 will be reduced by 7.5%. It sets forth the formula which will be applied in the establishment of hospital-utilization limits and repeats that pursuant to the provisions of section 150.40 General Assistance admissions will be paid up to $500 each.
In their complaint plaintiffs allege that the Department is required by article VII of the Illinois Public Aid Code (Ill. Rev. Stat. 1981, ch. 23, par. 7-1 et seq.) to provide "[a]id in meeting the costs of necessary medical, dental, hospital, boarding or nursing care, or burial" to recipients of Aid to the Medically Indigent and that as the result of the emergency rule, as of February 1, 1983, the program will be entirely eliminated. Plaintiffs seek a declaratory judgment that the elimination of the AMI program violates the Illinois Public Aid Code, the Illinois Administrative Procedure Act (Ill. Rev. Stat. 1981, ch. 127, par. 1001 et seq.) and the Emergency Budget Act of Fiscal Year 1983 (S.B. 1652) or, alternatively, that the Emergency Budget Act violates article II, section 1, article VIII, section 2(b), and article IV, section 9(d), of the Illinois Constitution. They also ask that defendants be enjoined from eliminating the AMI program, enjoined from the elimination of inpatient hospital services in excess of $500 per admission for General Assistance medical recipients, and for other relief.
The complaint of the intervenor County of Cook alleges that individuals currently being provided services through the AMI program will seek assistance at Cook County Hospital after February 1, 1983, that Cook County Hospital is currently operating at or near its maximum capacity and will be unable to handle a substantially increased load on short notice; that the increased financial burden placed upon the hospital by the defendants' actions threatens the future of the hospital and its continued ability to provide services for those in need; that the manner in which defendants have provided for the contingency reserves from the funds appropriated for General Assistance results in reserving $91 million rather than $54.6 million, the latter sum being equivalent to 2% of the sum appropriated and being the amount set forth in the Governor's notice to the Comptroller and the officers of the General Assembly in compliance with section 4 of the Emergency Budget Act. Intervenor seeks a declaratory judgment that the elimination of the AMI program violates the Illinois Public Aid Code and the Emergency Budget Act, or, alternatively, that the Emergency Budget Act violates article II, section 1, article VIII, section 2(b), and article VII, section 9, of the Illinois Constitution, and also prays for injunctive and other relief.
In the second count of its complaint, intervenor Cook County alleges that approximately 111,000 individuals are currently eligible for General Assistance payments in Chicago and Cicero. Payments last year on behalf of General Assistance recipients statewide averaged approximately $1,800 per hospital admission. It alleges that the reduction of payment for inpatient services to a total of $500 per admission between February 1 and June 30, 1983, will cost the county in excess of $2.5 million. It further alleges that the increased financial burden placed upon the hospital by the sudden and drastic cutback in State reimbursement seriously threatens the future of the hospital. It prays for a declaratory judgment, injunctive and other relief.
The complaint of the intervenor city of Chicago alleges that elimination of AMI will affect approximately 14,000 recipients who reside in the city of Chicago, that those former recipients of AMI will seek medical services at other city health facilities which will as a result be overburdened, causing a strain on the financial resources of the city. The city seeks a declaratory judgment, injunctive and other relief.
The complaint of the intervenors Illinois Hospital Association and several of its member hospitals describes the "methodology," which will be discussed later, for fixing per diem or per visit rates for hospitals for fiscal years 1982 and 1983. They ask that the court enjoin the defendant Director "from giving any force and effect to the Emergency Rules of January 19, 1983" and that the court issue a mandatory injunction directing the defendant Director to process interim claims for hospital services rendered pursuant to articles V, VI and VII of the Illinois Public Aid Code in compliance with the payment methodology expressly set forth in Public Act 82-787 and in Rule 4.13.7 adopted by the Illinois Department of Public Aid on November 30, 1982. These intervenors also seek a declaratory judgment and other relief.
The parties entered into a "joint statement" of the effect of permitting the emergency rules to go into effect. Following consideration of memoranda and oral argument the circuit court found that plaintiffs have a reasonable likelihood of prevailing on the merits on the issues; that the emergency rules violated the rights of plaintiffs under the Illinois Public Aid Code; that the emergency rules were not authorized by the Emergency Budget Act; that the Emergency Budget Act constituted an unconstitutional delegation of power under the Illinois Constitution; and that plaintiffs would suffer "immediate, certain and greater damage if a preliminary injunction does not issue than would defendants or the public at large if the preliminary injunction does not issue so that the hardships balance in favor of the plaintiffs." The court, on January 31, 1983, entered an order granting a preliminary injunction in which it enjoined the defendants:
"(a) From eliminating, suspending or otherwise terminating the Aid to the Medically Indigent Program;
(b) From limiting inpatient hospital care to $500 per admission under the GA program;
(c) From giving any force and effect to the IDPA `Emergency Rules' adopted on January 19, 1983;
(d) From paying medical providers entitled to payment under P.A. 82-787 otherwise than in accordance with P.A. 82-787.
(f) Nothing contained herein shall be deemed to enjoin Defendant James R. Thompson from complying with any procedural requirements of P.A. 82-1038, such as certification of ...