Hospitals, already adjusting to $1.6 billion in cost-cutting changes to Illinois' Medicaid system, are fighting what they call an extreme new emergency rule. Under the new rule, if a Medicaid patient incurs an infection or other hospital-acquired condition during the course of a hospital stay, say, for appendicitis, the state will not pay for treating the infection or the appendicitis. The new rule goes far beyond federal regulations, industry standards, and legislators' intent when they passed Illinois' Medicaid reform laws in May, hospital officials say.