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Illinois budget depends on Medicaid, pensions

Illinois Gov. Pat Quinn's budget chief says drastic changes need to be made on how the state funds Medicaid and pensions. David Vaught testified Wednesday at a Senate Approporiations Committee hearing. He said Illinois lawmakers must put more money toward the state's pension and medicaid systems in the 2013 budget.

The state is facing more than $8 billion in unpaid bills and pension costs on top of a $500 million deficit.

"We clearly are going to have to change things on the liability side, and those are still unclear," said Vaught.

The governor's budget office and the non-partisan Civic Federation said without reforming the two systems, the state's backlog of unpaid bills could reach $35 billion dollars by 2017. The state comptroller's office agrees with that projection.

Quinn has said making changes to the Medicaid and the pension system will be a top priority this year.

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