MedicaidReimbursementHigh impact
Repeal of 3.5% Rate Reduction per Public Act 102-0016 Effective July 1, 2021
Illinois Medicaid - HFS·IL·Provider Notice
Effective date
Jul 1, 2021
We identified it
Jun 20, 2026
Summary
Illinois is repealing the 3.5% SMART Act rate reduction for hospital services effective July 1, 2021, resulting in higher reimbursement rates. All fee-for-service claims with dates of service on or after July 1, 2021 are being held until federal approval is received, then will be processed at the higher rates.
Action Required
Immediately: Monitor all Medicaid fee-for-service hospital claims with dates of service July 1, 2021 or later for Status Code I41 (Institutional Claim Hold) on remittance advice. Once federal approval is received and claims are released, review payments to ensure correct higher reimbursement rates are applied. If any claims are rejected after release, billing team has 180 days from release date to resubmit. Contact hospital billing consultant at 877-782-5565 for questions.