SPRINGFIELD - The collective ear of area hospital administrators perked up Thursday when the state Senate approved a $1.2 billion measure to give Illinois health service providers some overdue financial relief.

Although the legislation still has hurdles to clear before the state can start cutting checks, hospital administrators are glad to see some activity, even if it's eight months behind schedule.

"This is money we should have had way back in the last legislative session," said George Maroney, administrator at Carbondale Memorial Hospital. "We just want the money. It's unconscionable that the state has taken this long to get this legislation moving."

For the last three years, Illinois hospitals have been paying a state tax in exchange for an annual assessment. Each year, the money is matched by the federal government then redistributed statewide with the intention of compensating those hospitals treating large quantities of Medicaid patients.

Carbondale Memorial stands to receive more than $4.1 million in quarterly payments from the state.

Until last year, the program had worked without a hitch and hospitals received money in a timely manner. Then last year, lawmakers began attaching amendments and other unrelated issues to the legislation.

"The fear is that the governor is going to tie something to it, and it'll get bogged down somewhere along the way," Maroney said.

However chief sponsor, state Sen. Jeff Schoenberg, D-Evanston, said the measure is a "clean bill" and will move through the House quickly in the hands of House Majority Leader Barbara Flynn Currie, D-Chicago.

"I think people understand that it's a pretty important to get this money to the hospitals soon," Currie said.

But in the meantime, some hospitals with low budgets and low-income patients getting by on Medicaid have had to take out loans just to make payroll.

"Institutions, which have overwhelming numbers of Medicaid patients, have been living on the edge of a cliff waiting for the General Assembly to authorize release of the final year's funds," Schoenberg said.

The future of the federal program is up in the air, this being the last year of a three-year deal between Illinois and the federal government. Schoenberg said the federal government is demanding that Illinois disperse the funds throughout the state on more of a financial need basis, rather than helping individual hospitals make a profit off their taxes.

"They are expecting more Robin Hood out of Illinois if they are to approve another program," Schoenberg said. "We can't afford not to; if we don't have another plan in place, it could leave a $730 million hole in the state budget."

Kartikay Mehrotra can be reached at Kartikay.Mehrotra@lee.net or 789-0865.