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New Cook County Health CEO searching for savings

Published: Monday, July 14, 2014 11:46 p.m. CDT

CHICAGO – Dr. John Jay Shannon, the new chief of Cook County's health system, has a big job ahead: finding $67 million in savings to help erase a projected year-end budget deficit, according to a published report.

Most of the anticipated budget shortage stems from CountyCare, the county's new Medicaid managed care program, which had been expected to bring more than $270 million in revenue this fiscal year. CountyCare started in 2013 as an early expansion of Medicaid to the low-income adults who would be eligible under President Barack Obama's health care overhaul in 2014.

Shannon told Crain's Chicago Business there were "unrealistic expectations" that the CountyCare program would be "some kind of profit center" for the county's entire public health care system.

Instead, Shannon said, the program's 95,000 enrollees — patients who were previously uninsured — are demonstrating a pent-up demand for health care, including expensive surgeries and hospital stays. Keeping costs under the $314 per-patient per-month rate the county received from the federal government last calendar year was a challenge.

The picture is improving, Shannon told The Associated Press. The per-patient federal reimbursement rate for CountyCare doubled Jan. 1 of this year when the Affordable Care Act took effect.

The county's challenge now is to rein in the medical costs of the CountyCare patients through more preventive care, less emergency room care and mail-order medications for chronic illnesses.

Shannon last month was named CEO of Chicago-based Cook County Health and Hospitals System, one of the nation's biggest public hospital networks. He replaced Dr. Ramanathan Raju, who left to take the head post at New York City Health and Hospitals Corp.

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