Advocacy Update from Mark Stutrud

Advocacy Update from Mark Stutrud: Potential Federal Cuts and Their Impact on LSSI

Dear Friends, 

I have recently returned from an advocacy meeting with Lutheran Services in America (LSA) in Washington, DC, where nonprofit leaders discussed the federal budget, potential cuts and reforms to Medicaid, and the potential impact on social service organizations like Lutheran Social Services of Illinois (LSSI). Additionally, we visited with Congressional members to advocate for keeping Medicaid services intact.  As you may be aware, there is significant uncertainty surrounding these changes. While the information we have is fluid, we want to share with you what we know at this time. 

There remains great concern over how Congress will proceed with addressing what is perceived to be waste and abuse in the Medicaid system. Over 3.4 million people in Illinois, a quarter of the state’s population, rely on Medicaid for access to healthcare and critical support services. Funding cuts could have significant and devastating consequences, and cuts to Medicaid will impact every LSSI program by reducing, and in some cases eliminating, our ability to afford to provide services. The majority of LSSI clients are on Medicaid, including older adults, adults with disabilities, and all children in foster care. Without Medicaid, a child in foster care would not be able to visit the doctor.  

Additionally, the majority of states, including Illinois, have provider taxes that help to maximize the Federal match, and in return, fund skilled care and safety net hospitals. There is a proposal to restrict or eliminate those taxes, which will decrease funding for LSSI’s 24/7 behavioral health services in five hospital emergency departments and dismantle the integrated health safety net in Illinois. 

Currently, there is thought to be sufficient votes in the U.S. House and Senate to approve a budget that includes significant cuts. It is most likely that states will face a decrease in federal funding, and each state will need to determine the best course of action in response. A tentative deadline for the approval of the federal budget is set for May 31, 2025, though many believe this will not be achievable. Several states, including Illinois, are considering a special session to address the impact of the federal budget on state programs. We will share more details with you in late spring or early summer as we learn more. 

LSSI is actively analyzing the potential cuts and their longer-term impacts and seeking ways that the decreased funding could be mitigated. However, uncertainty remains a significant challenge, and we are committed to adapting to whatever comes. 

As always, our dedicated staff members work with individuals every day who face uncertainty in their lives. This is a critical part of our mission—to provide services even in stressful and uncertain times, as our clients experience this uncertainty daily. Despite the ongoing uncertainty about federal funding, our staff continue to provide vital programs to the people we serve across Illinois. 

We understand that you, as a valued supporter, share in this commitment to serve those in need. Looking ahead to the budget decisions about to be made that impact millions of people, there will be times when we need to quickly reach as many individuals as possible and ask them to use their voice to advocate for LSSI and its clients. As we navigate this uncertain season, please help us expand our reach by encouraging your friends, family, and colleagues to sign up to receive updates at LSSI.org/SignUp. That way, they’ll be the first to know when we have important news to share. 

Thank you for your continued support as we work to maintain our services and fulfill our mission. 

Sincerely,
Mark Stutrud
President and CEO of Lutheran Social Services of Illinois