What I want to go into is why this deficit dropped from $554 million to $232 million, and combine it with some past history. The DHS itself admits that they and the Walker Administration have done nothing to "improve" the Medcaid deficit picture in the letter they sent the Joint Finance Committee. I'll throw in my own notes at the end of each of the 4 points in the letter.
Caseload: Under current eligibility standards, based on actual enrollment to date, we project that enrollment growth will be smaller in FY 12 compared to Act 32 [the state budget] assumptions. We project that enrollment will continue to grow, however, eventually reaching roughly the same average level in FY 13 as assumed in Act 32....[basically the DHS thought there would be more people on Medicaid than there actually were. Oops.]So out of 4 reasons for the reduced deficit, 2 are due to the state overstating the amount of the Medicaid crisis, and 2 are due to Obama Administration policies that help states. Nice, huh?
Medicare Part B Premiums: The state is required to pay Medicare Part B premiums for Medicaid enrollees who also participate in Part B. In November, the federal government announced 2012 premiums that were lower than assumed in the September estimate. [in other words, the Feds demanded less money than the state thought they would. "Thanks Obama!"]
Drug rebates: The September projection assumed that the Department would need to return $25 million of drug rebates received in FY 11 to the federal government based on provisions in the Patient Protection and Affordable Care Act (PPACA) [THIS IS OBAMACARE!] Based on a more detailed analysis, the repayment amount is now estimated to be approximately $7 million. [or $18 million saved. Once again, "Thanks Obama!"]
Cost per enrollee trends: Actual expenditure data in FY 12 indicate costs per enrollee for various services will be lower than assumed in the September projection. The projection still assumes that costs for the average enrolee will increase during the biennium, based on historical trends. [DHS overestimated the costs. Oops again].
Of course, despite the improved budget picture, DHS Secretary and Heritage Foundation hack Dennis Smith is still saying that they won't reduce any of the $554 million in projected Medicaid cuts, because Smith said "We have to make sure we grow the profits of our insurance company donators and throwing people off of Medicaid and Badger Care and into the private market is a great way to do that." (Oh wait, he didn't say that, but was only thinking it. Sorry bout that)
And why am I skeptical of how this played out? Because Smith, DHS and the Walker Administration have a history of lying and deceiving on these topics. The worst example was in August, when Smith and DHS cherry-picked and gave false impressions when they relayed the state's own report on the effects of Obamacare, then tried to silence the author of the report, lest he tell media that Obamacare would cover over 340,000 more Wisconsinites in the next 5 years. More recently, you have the Family Care fiasco, where not only did the Walker Administration put an illegal limit on enrollment in the popular program, but then Walker held a press conference and tried to take credit for the move when DHS and Walker had been ordered by the Feds to lift the cap. So with that sort of background, why wouldn't Smith and DHS give a "rosy scenario" of increased Medicaid enrollment and costs to cause a "budget crisis" to appear, and then use this crisis as an excuse to put in big cuts to social services and other areas of the budget?
It's not like Walker hasn't pulled similar garbage before, such as when he sent off layoff notices of Milwaukee County employees in 2009 and then admitted it was a trick to grab more budget concessions (messing with employees' jobs- HILARIOUS!), and then 5 months later ended up with a $9 million budget surplus.
And in the unforgettable David Koch phone call, Walker bragged about planning to send "5 to 6,000" layoff notices to state workers to "crank up a little more pressure" on the Wisconsin 14 after they left the state. Walker's administration knew thousands of state workers had already retired or left service and that there was no need for layoffs if they wanted to lay off current staff to bring down expenses to the level they wanted (for that reason, I knew the threat was bullshit at the time, and I was hardly a higher-up).
So "broken" budgets and huge cuts have been consistently pulled by Walker and his boys as a deceptive hardball tactic to try to get his way, and so I reserve the right to be suspicious of past and current Medicaid numbers. Don't be shocked if some other new "surprise" pops up as this runs through Joint Finance and the Legislature in the next few weeks, and maybe we'll see some other fun revelations at the State of the State on Jan. 25. Keep your eyes open on these things and don't let up, because Scotty thinks he can grift and deceive his way into selling off Wisconsin one more time to his contributors, but he won't be able to do it if we do a little "cranking up" of the pressure ourselves.