Beyond expansion - a lot to discuss with Medicaid tomorrow

The Joint Finance Committee has its biggest week yet coming up, starting with health care and similar social services tomorrow. So let’s look at what the Legislative Fiscal Bureau says it’ll now cost to continue with our medical assistance programs under their newly-updated assumptions.

One good item development since Evers submitted the budget is that Wisconsin is in line to get more federal dollars for Medicaid…but not through Medicaid expansion.

The administration's MA cost-to-continue estimates were based on projections of the state's FMAP (how much of these expenses are covered by the Feds) for the 2019-21 biennium available at the time of the introduction of the bill. The estimate assumed an FMAP of 59.36% for both federal fiscal years (FFY) 2019-20 and 2020-21. Since the time of these estimates, the federal Bureau of Economic Analysis has published data on state and national 2018 per capita income. Incorporating this data into the FMAP calculation results in a slight increase to the FFY 2020-21 FMAP, from 59.36% to 59.61%. Consequently, the state fiscal year 2020-21 FMAP rate is reestimated to be 59.55%, rather than 59.36%, as assumed in the bill. This change has the effect of reducing the GPR (state tax dollar) costs of MA program benefits by approximately $19.5 million over the biennium and increasing FED costs by a corresponding amount.

14. The increased FMAP for FFY 2020-21 also has the effect of increasing the federal matching rate for services provided to children who are eligible for coverage under the children's health insurance program (CHIP). Federal law provides an enhanced FMAP for CHIP services. The enhanced CHIP FMAP is currently also subject to a temporary increase. The ongoing enhancement has the effect of reducing the state's share by 30%, relative to the standard FMAP. The temporary adjustment increased the CHIP FMAP by an additional 23 percentage points from FFY 2015-16 through FFY 2018-19, decreasing to an 11.5 percentage point increase in FFY 2019-20. No additional increase to the CHIP FMAP is provided in FFY 2020-21 and beyond.

I bet the GOP Legislature won’t turn down this projected bump in federal coverage under conventional Medicaid. But getting an extra 30% of the costs covered by the Feds through Obamacare’s Medicaid expansion to cover the exact same services, well that’s a bridge too far! (slams head on the desk)

Put together with higher enrollment in Children’s Long-Term Care Services and other enrollment and cost trends, and there will be nearly $140 million in extra Medicaid spending than we originally thought would be needed 4 months ago. Fortunately for Wisconsinites, most of that is taken up by sources outside of state tax dollars.

The revisions to the cost-to-continue estimate assumptions discussed in this paper, result in, relative to the bill, an increase of $2.1 million to the GPR funding for MA benefits over the biennium, a total increase of $75.0 million in combined GPR and FED funding, and an increase of $139.8 million from all fund all sources. Relative to the MA base, GPR funding for MA would increase by $356.1 million GPR over the biennium and by $926.3 million from all fund sources. The following table shows the total funding by year and fund source under the reestimate, along with the corresponding change to the bill cost-to-continue estimate.

So let’s take into account the adjustments for current enrollment trends and costs, and look at how the updated figures that would indicate how much more needs to be spent in state tax dollars over the next 2 years to do all of the things Evers wanted to do in this budget with Medicaid, now that Medicaid expansion has been removed.

Added Medicaid costs in Wis tax dollars vs 2019 base
Medicaid cost to continue +$356.1 million
Increased cost of contractors to perform current services +$22.84 million
Increase reimbursement for physician/behavioral health services +$29.5 million
Senior Care cost to continue -$5.27 million (lower number of enrollees)
Increased money to attract direct care workers in Family Care +$12.0 million
2.5% increase in reimbursement to nursing homes +$10.76 million
3.0% personal care rate increase by July 1, 2020 +$6.55 million
New “community health” supplemental benefit +$18.2 million
Incentives for dentists to take patients on Medicaid +$10.92 million
Allow women to stay on Medicaid 12 months after giving birth vs 2 today +$9.26 million
Increased staff for Children’s Long-Term Care Services +$1.36 million
Payments to funeral homes, cemeteries etc to bury MA recipients -$0.31 million
TOTAL +$471.91 MILLION

A lot of those increased reimbursement rates are items that Assembly Speaker Robbin' Vos and other Republicans have said they want to see, as the state struggles with increasing amounts of nursing homes closing and a significant shortage of caregivers. Of course, Vos falsely added that Medicaid expansion would somehow get in the way of these rate increases, since all Medicaid expansion changes is that the Feds pay more of the bill, and doesn't change the services that are eligible.

There also are a number of other services that draw upon Medicaid funding to deal with other Public Health initiatives that Evers proposed for this budget. Some of this may have used expanded Medicaid money, but some were entirely state-funded as an Evers initiative beyond Medicaid.

Lead exposure and Poisoning items +$11.75 million
Increase funding for Birth to 3 program for children with developmental disabilities +$9.15 million
Increase funding for anti-tobacco programs/research +$6.6 million
Add dementia care specialists in the state +$4.94 million
Seal-a-smile and grants for dental clinics that serve low-income patients +$2.98 million
Restore funding for programs on “healthy aging” +$0.5 million
TOTAL WIS TAX DOLLARS +$35.92 MILLION

And while expanded Medicaid might not have paid for these new and expanded services themselves, it still was a major part of Evers' plans, because the savings of everyday Medicaid would have freed up state funds to pay for the other programs. Now that the GOPs have shot it down, it would cost more than $500 million in state tax dollars above the 2019 base to do this.

So it is now up to the WisGOP-controlled Joint Finance Committee to come up with a way of paying for that $500 million+, or to decide what they won’t allow. Technically, there is enough money to pay for all of this, now that most of Evers’ proposed increases in K-12 education and the UW were taken out of the budget. But we shouldn’t count on all of those provisions making it through JFC, because how can you continue tax cuts to the rich and corporate if you help Wisconsinites in need? (#headdesk again)

Given the way GOP co-chairs John Nygren, Alberta Darling and the rest of the ALEC crew operate, you can bet they’ve been cobbling their health care plans together in secret, and will spring it a couple of hours before they meet and vote. I’m not counting on much, but given that removing Medicaid expansion is already unpopular, I’m also not sure how much more heat GOPs want to put onto themselves by not expanding health care services on top of that.

Stay tuned tomorrow, I suppose.