Illinois unable to access Medicaid systems hours before President Trump's freeze on grants was supposed to take effect

Alice Yin, Chicago Tribune on Jan 28, 2025

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CHICAGO — Hours after President Donald Trump’s administration announced it was freezing potentially trillions of dollars in federal grants and other fiscal aid across the nation, Illinois agencies were having trouble accessing Medicaid systems, a top spokesman for Gov. JB Pritzker said Tuesday.

State agencies reported “issues with accessing federal funding sites and disbursement systems, including Medicaid systems,” Matt Hill, a Pritzker spokesperson, said in a statement.

Affected funding could include child care, law enforcement, disaster relief and hospitals, U.S. Sen. Tammy Duckworth said in a statement, while U.S. Sen. Dick Durbin said in a separate statement that Head Start and food assistance programs, as well as food inspections, could also be at risk.

A notice at the top of the federal Medicaid Payment Management System website on Tuesday read: “Due to Executive Orders regarding potentially unallowable grant payments, PMS is taking additional measures to process payments. Reviews of applicable programs and payments will result in delays and/or rejections of payments.”

The problems were reported before the freeze was expected to take effect, which Trump’s administration had said was 4 p.m. Tuesday. It came as Democratic political leaders from Illinois blasted the Trump freeze, calling it outrageous and unconstitutional.

“Outrageous and illegal,” Duckworth wrote on the social media platform X.

Chicago Mayor Brandon Johnson sought to tamp down concerns over the late-night order but could not provide details on how Chicago’s budget would be affected.

At a City Hall news conference, the mayor shot down the legal standing of the Trump memo issued Monday evening by the White House’s budget office. But he and his budget director declined to state how much of Chicago’s approximately $4 billion in grant funding could be jeopardized, or whether the memo could eliminate federal funding for the Red Line extension.

“This is something that is well outside the purview of the executive office,” said the mayor, who noted he spoke with Duckworth and U.S. Sen. Dick Durbin on Tuesday morning.

“These appropriations have been mandated by the legislative branch,” Johnson said. “These are laws.”

Pritzker also was in touch with local and federal officials, other governors and non-government organizations about the memo, Hill said. The governor’s office has been directed to “assess the detrimental impacts of this unlawful action,” he said.

Johnson’s budget director, Annette Guzman, said her office is conducting an analysis on the impact of the freeze but she did not elaborate on the scope, saying “further digging” is needed.

“It all comes under the framework of understanding the legality of the orders to begin with,” Guzman said. “It’s the same kind of concept that we’re looking into, as to whether or not these (executive orders) have the authority over Congressional spending.”

Among the biggest projects needing federal funding is the long-planned extension of the Red Line south to 130th Street. But it wasn’t immediately clear if or how the federal grant pause might affect the extension, as well as other transportation projects.

The agency signed an agreement locking in a federal grant days before Trump took office, and officials said Tuesday morning they continued to view the agreement as binding.

“The Red Line Extension Project’s funding grant agreement that the CTA and FTA (Federal Transit Administration) executed this, like similar grant agreements that the CTA secured for projects such as the Red Purple Modernization Program, is a binding and legal commitment by the federal government to provide the committed and obligated funds,” spokeswoman Tammy Chase said in an email. “As a result, we do not interpret any recent activity to have any impact on the federal government’s commitment to fund this essential transit project.”

The CTA, like other transportation agencies, also relies on federal funding for a variety of other construction projects. Chase said the agency’s law department was reviewing the latest federal directive “as it relates to future federal funds for CTA beyond funding grant agreements already in place.”

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