Wednesday, February 26, 2025

Medicaid stuff and what it might do to Wisconsin's budget. And Wisconsinites

I wanted to riff a bit about where we are at with Medicaid, both as part of the discussions around GOP Tax Scam 2.0, and in how this might affect our state's budget.

You may have heard that the GOPs in the House were able to cobble together a budget bill yesterday, squeaking it through without another vote to spare. I heard some people take on an attitude of "Medicaid is now doomed!" following that vote, and that's not close to true. As Bobby Kogan of the Center for American Progress tells us, what was voted on yesterday was an OUTLINE of a budget, and there are plenty of steps left.

So, the next step is for the House and Senate to agree to an identical budget resolution. The Senate passed a very different version. It called for the same SNAP cuts but much smaller Medicaid cuts - and no tax cuts. This is the next place where we can stop them.

— Bobby Kogan (@bbkogan.bsky.social) February 25, 2025 at 7:22 PM

If we fail, then after that, committees can begin writing legislation. Usually the House goes first. If taxes are involved, the House must go first. At least one chamber needs to go through the full committee markup. In this thread, I'm going to assume that's the House.

— Bobby Kogan (@bbkogan.bsky.social) February 25, 2025 at 7:22 PM

So, each committee will write legislation that adheres to the instructions set in the budget resolution. Here's what the House budget resolution calls for:

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— Bobby Kogan (@bbkogan.bsky.social) February 25, 2025 at 7:22 PM

You'll notice that there aren't any specifics besides what committee adds or reduces spending, or in what way the Ways and Means Committee would cut taxes by up to $4.5 trillion over 10 years.

It's that Energy and Commerce item of $880 billion in cuts where Medicaid comes in, since that is where Medicaid funding is determined. Which led to this pathetic attempt at spin by GOP House leadership last night.

Upcoming Senate debate notwithstanding, it is absolutely WILD that Speaker Johnson said "Do a word search… it doesn't even mention Medicaid in the bill" and Steve Scalise said "This bill doesn't even mention the word Medicaid a single time" about a budget resolution requiring E&C to cut $880B

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— Adrianna McIntyre (@adrianna.bsky.social) February 25, 2025 at 7:37 PM

It is literally impossible to get $880 billion in savings over 10 years from that committee without deep cuts to Medicaid. That's not a liberal take, it's MATH.

So now this budget resolution heads to the US Senate, and the one Wisconsin US Senator that does actual work had an event in Milwaukee this week to discuss the potential Medicaid cuts.

Check out this article from FDL Reporter: Sen. Baldwin, Democrats raise alarm about potential cuts to BadgerCare Plus, other Medicaid programs www.fdlreporter.com/story/news/2...

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— dampman.bsky.social (@dampman.bsky.social) February 24, 2025 at 6:25 PM

"Congressional Republicans are ripping away health care from our most vulnerable to fund tax breaks for their wealthy friends," Baldwin said in a press conference last week with other Democrats. "Cuts of this size will endanger the health and lives of millions of Americans….

"In Wisconsin, about one in five residents are covered by Medicaid in some form. Last fiscal year, close to 1 million people, more than half of them children, were covered by BadgerCare Plus, the state's largest Medicaid program, in an average month. Hundreds of thousands more, including low-income seniors and disabled people, were covered by other Medicaid programs, such as Family Care and the Katie Beckett program.

Together, the programs in Wisconsin cost more than $12 billion to run each year. Federal taxpayers pick up more than half of Wisconsin's Medicaid expenses. For most Medicaid services, for every 40 cents in state dollars spent, the federal government pays 60 cents.
And that's an amount that would go up Back in September, the Wisconsin Department of Health Services (DHS) said that even if Medicaid wasn’t expanded in the state, there was still expected to be an increase in Federal funding of over $1.73 billion in this biennium, and total FED funding of $16.85 billion overall. Governor Evers’ Administration later estimated the FED increase would be even higher, at $2.65 billion. That’s because of an expectation of increased costs of services and higher enrollments over the next two years (in what was estimated to be a growing economy, mind you).

In addition, Evers’ budget asks for Medicaid expansion under the Affordable Care Act, which would increase FED coverage of costs by $2.51 billion, while reducing the share of state tax dollars by more than $1.9 billion (costs are higher in the program overall because the number of Wisconsinites eligible for Medicaid would go up).

Those numbers were based on the current laws of 2024, with Biden-era incentives and extra coverage for Medicaid expansion staying on. Now throw that into reverse, where not only do the Federal incentives for Medicaid expansion and increased coverage not get used, but also where the Feds cover less of any expense associated with the Medicaid programs that currently exist (a likely way that Trump/GOP would find “savings” to pay for their tax cuts to the rich).

If more state tax dollars are going into BadgerCare services, the $4.3 billion that we are slated to have in the bank on July 1 will go away quickly.

Another aspect to possible GOP health care "savings" was outlined in a different Journal-Sentinel story on how Trump/GOP wants to cut funds that help Americans figure out their options under Medicaid and other health care programs.
This month, the Centers for Medicare and Medicaid Services said it would cut funding nationwide for navigator programs, which help enroll people in health coverage, to $10 million, a drop of about 90%.

"A cut of this size will impact our ability to provide all the services and all the information in as timely a way as possible," said Allison Espeseth, director of Covering Wisconsin, the navigator program for the state.

Federal funding makes up about three-quarters of Covering Wisconsin's budget, Espeseth said. The cuts would occur starting in its next budget cycle in late August, she said….

Navigators differ from insurance brokers in key ways. Brokers, who rely on commissions, were far less likely to help consumers sign up for Medicaid, the publicly-funded insurance program for low-income people, or for the Children's Health Insurance Program, also known as CHIP, according to a 2022 survey by the health policy research group KFF.

Last year, Covering Wisconsin helped enroll more than 9,600 people in marketplace coverage or in Medicaid, Espeseth said. More broadly, the agency assisted around 60,000 people with questions or other issues that year, she said.
And those navigators have been especially busy in recent years, as Wisconsinites were de-enrolled from Medicaid after COVID-era laws expired, which led many people to seek health care through the Obamacare exchanges. There also was a boost given through the Inflation Reduction Act that was passed by a Dem-run Congress and signed by President Biden in 2022, which expanded tax credits to people who got their coverage on the exchanges.

As the Legislative Fiscal Bureau reports, Wisconsin had a record number of sign-ups for coverage under the Obamacare exchanges in 2024, with more likely to have signed up in this year.

While this may not be directly related to Medicaid cuts, those enhanced subsidies for ACA exchange policies need to be renewed by the end of the year. And the Kaiser Family Foundation went into what would happen if expanded subsidies are allowed to expire on January 1.
If the enhanced subsidies expire, monthly premium payments for the vast majority of Marketplace enrollees will increase sharply starting January 1, 2026. Among subsidized enrollees living in states that use Healthcare.gov (where data are available), premium payments would have been an average of 93% higher in 2024 without the enhanced tax credits. (Wisconsin is one of those states). If these enhanced subsidies expire, the Congressional Budget Office (CBO) projects that there will be an average of 3.8 million more uninsured people each year. Unsubsidized premiums will also likely rise as healthier enrollees drop their coverage. While some state-based Marketplaces offer additional premium financial assistance for certain enrollees, the amount of and availability of these state subsidies would not be enough to fully replace the federal enhanced subsidies….

The expiration of the enhanced premium tax credits would mean that people with incomes over four times the poverty level are no longer eligible for financial assistance. Prior to the availability of enhanced subsidies, ACA Marketplace premium assistance eligibility capped at 400% of poverty (which is $60,240 for a single person or $81,760 for a couple in 2025). If enhanced subsidies expire, Marketplace enrollees making just above 400% of poverty will encounter the “subsidy cliff” and would face the full price of a Marketplace plan. If the enhanced subsidies expire, a 60-year-old couple making $82,000 (401% of poverty) would see their premium payment for the benchmark silver plan, on average, at least double in the vast majority of congressional districts. The benchmark silver premium for a 60-year-old couple at this income would triple or more, on average, in 328 congressional districts.

A 40-year-old Marketplace enrollee in the contiguous U.S. making $31,000 (206% of poverty) would see monthly premium payments in 2025 rise by $95 (a 165% increase) from $58 to $153. (Alaska and Hawaii have different poverty guidelines). Nationally, there are 75 congressional districts where at least 10% of the population is enrolled in the Marketplace. For a 40-year-old making $31,000, premium payments would at least double on average in all 75 districts. 62 of these districts are in Florida, Georgia and Texas. 38 of these 62 districts are represented by Republicans while 24 are represented by Democrats.

Under the enhanced phase out caps, Marketplace enrollees with incomes up to 150% of poverty currently pay zero (or near zero) dollars for a benchmark silver plan. Should the enhanced subsidies expire, enrollees in this income group will be on the hook for some of the cost of their premiums if they want to keep a silver plan. Before the enhanced subsidies went into effect, Marketplace enrollees at this income group paid about 2-4% of their income for a benchmark plan. A sizeable portion of the Marketplace population benefits from zero dollar premiums, with 42% of HealthCare.gov enrollees in 2024 paying nothing for Marketplace coverage (up from 14% of HealthCare.gov enrollees in 2021).
That increase in out-of-pocket costs would be a hell of a sticker shock for a lot of people as 2026 begins, and Trump/GOPs would rightfully be blamed for it, especially if those "savings" are done to lower taxes for the rich.

And the more that Trump/GOP would reduce Federal funds to pay for health care services, it reduces the funds available for any kind of tax cuts in Wisconsin. That's true whether you're talking about the extra funding to allow property tax cuts like Gov Evers wants in his budget, or the general income tax cuts that Wisconsin Republicans seem to support. So maybe WisGOP’s state legislators should try to get in touch with their Congressional counterparts and tell them that it isn’t a good idea to mess with Medicaid at this point, for multiple reasons. Or else they’ll all be out of power in 2027 (well, even more likely to lose power than they already are).

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