Saturday, January 12, 2013

Medicaid's balanced- by throwing lives out of balance

If you're wondering how the Walker Administration could consider balancing its debt and deficit-ridden budget with a possible income tax cut, take a look at how the Wisconsin Department of Health Services allegedly balanced its budget, and the damage that was done in the process.

On a classic Friday news dump, DHS Secretary Dennis Smith informed the Legislature's Joint Finance Committee at the end of December that the projected Medicaid deficit for the state was going to disappear. And the way they did it was by tossing the working poor off of BadgerCare, and making those who stayed pay more out of pocket.
On July 1 [2012], non-disabled and non-pregnant adults with incomes at or above 133% of the federal poverty level (FPL) became subject to the same premium amounts that will be required of individuals eligible for federal tax credit subsidies through health insurance exchanges beginning January 2014. The premiums are based on a percentage of a family's income based on a sliding scale. Individuals that do not pay a premium are allowed a grace period to pay the premium, before they are subject to a 12-month restrictive re-enrollment period.

The Department has developed tracking tools to measure the impact of the premiums on enrollment. A total of 11,682 individuals or 23% of 48,835 individuals subject to premiums did not pay the required premiums in July, August, or September, and were disenrolled after the grace period was exhausted.
And of the 3,140 individuals that were on BadgerCare that made over 200% of the poverty level or more, 53% dropped off of BadgerCare. Now you can hope that this was because these individuals found a better job that paid health care benefits, but given the bad job performance in the state in the age of Fitzwalkerstan, I'd say it's more likely they ended up not getting insured whatsoever, and chose to spend their limited money on other necessities.

Sure, it got the Medicaid budget into balance (well, until Logisticare adds another $40 million to the cost when it's rebid in a month), but how many people got left out to do so. And for what? So insurance companies could get more clients and this administration could brag about "fiscal responsibility" (and they're still failing miserably). Hope you enjoyed Wisconsin being among the national leaders for having people be insured, because we're going to fall into mediocrity very soon under these guys with these policies.

And another way the DHS got the budget into balance is by cutting payments to providers of Medicaid-related services. This resulted in the Eau Claire-area's Community Health Partners (CHP) laying off over 350 employees at the end of this year, and news dropped yesterday that CHP has fallen into receivership and will be liquidating its assets. Now the state claims they have found a CHP replacement for a similar cost, but what happens to the workers that were at CHP? Well, they end up having to get dislocated worker assistance from the Wisconsin DWD at taxpayer expense. So didn't save all that much in Western Wisconsin, and got a whole lotta unnecessary disruption.

This governor is stilll clinging to the delusional thought that he's some kind of contender for national GOP office, so you can bet he'll try some kind of "innovative" program that allegedly controls Medicaid costs while keeping taxes low in this upcoming budget. And for the "GOP bubble world" crowd, it'll probably also involve tweaking President Obama and done in a way to try to keep Obamacare from being effective or cost-efficient. Citizen Action of Wisconsin and Communtiy Advocates think one of the ways Walker's DHS may try to do this is by not going along with Obamcare's offer of increased federal funding for increased availability of Medicaid. They sent out a relase yesterday reminding the Governor that he could be screwing Wisconsin businesses if he chooses such a short-sighted, ideological policy.
On a Media Call Friday morning health advocates discussed new research that shows that Wisconsin businesses will pay $120 million more in federal taxes if Governor Scott Walker rejects increased federal Medicaid money offered by the Affordable Care Act, the national health care reform law.

The reason for this huge tax differential is that under the terms of the Affordable Care Act employers with over 50 employees who do not offer adequate health insurance pay an additional tax penalty if their employees enroll in the new health exchanges. (aka the "freeloader tax") They do not pay a tax penalty if employees enroll in Medicaid (BadgerCare).

“Another important reason the Governor and the Legislature should accept hundreds of millions in federal money to fill the gaps in BadgerCare is to protect Wisconsin employers from a massive federal tax increase,” said David Riemer, Senior Fellow at Community Advocates Public Policy Institute, and the author of the analysis.

We've already seen a hint of this with Walker's pose of refusing to set up a state-run Obamacare exchange and leaving it up to the feds to do it. Do not be surprised if he tries a move with Medicaid that would be similar to the costly, unproductive decision to turn down stimulus money for high-speed rail. Turning down the train money is still a move that we are still paying for, as the DWD release that mentioned assistance for CHP workers also said former Talgo workers would receive dislocated worker assistance (turning down the train is truly the "gift" that we keep having to pay for).

Much like with the train, the DHS's messing with Wisconsin's previously-strong health care services will add nothing to the state's quality of life, and probably cost the state a whole lot of economic activity due to lost jobs and lost disposable income.


  1. They were being sued for keeping folk off of Badgercare (see - especially the top of page 7), but that case changed venues and I've not been able to relocate it.

  2. Geoff- I assume you're referring to the suit filed by people who said the State kept a BadgerCare Plus waiting list of 100,000 when there were up to 20,000 spots available. A quick scan doesn't come up with much other than the initial filing this June.

    I didn't even have the space to mention the December 2011 Family Care Fiasco, which didn't get nearly the attention and derision it derserved.