AutoInsuranceMM.Info – What is the Insurance – Wisconsin and the ACA’s Medicaid expansion
No ACA Medicaid expansion, but no coverage gap either
Although Wisconsin has not expanded Medicaid under the guidelines laid out in the Affordable Care Act (ACA), the state’s BadgerCare Medicaid program does cover all legally present residents with incomes under the poverty level. Wisconsin is the only non-Medicaid-expansion state that does not have a coverage gap; all low-income residents either have access to Medicaid or subsidies to help them purchase private coverage in the exchange. As of June 2018, there were 178,000 non-disabled adults without minor children who had coverage under BadgerCare.
Wisconsin Governor Scott Walker has long been opposed to the ACA, and one of the reasons he opted not to accept federal funding for Medicaid expansion under the ACA was because he was concerned that the federal government would not keep its promise to continue to pay at least 90 percent of the cost. But because Wisconsin has not expanded Medicaid, the state is only receiving its regular federal match rate of 58.5 percent, and the state is paying the rest. If the state were to expand Medicaid to cover adults earning up to 138 percent of the poverty level, the federal government would pay 94 percent (in 2018, dropping to 90 percent by 2020) of the cost of covering able-bodied, childless adults.
The Wisconsin Legislative Fiscal Bureau estimates that an additional 80,000 people would be eligible for Medicaid if Wisconsin were to expand coverage under as called for in the ACA, but that the state would also save $380 million over the 2017-2019 biennium. The saving would be a result of the much higher federal matching rate that the state would receive if Medicaid were to be expanded.
BadgerCare Reform waiver proposal: A 48-month limit, but months only count if the enrollee isn’t working
In June 2017, Wisconsin submitted a proposed 1115 waiver to CMS, detailing reforms that the state wants to make to its existing Medicaid program for childless adults ages 19-64. The proposed changes were called for under the terms of the 2015-2017 budget bill (Act 55) that the state enacted. CMS approved the waiver in October 2018, but with some modifications.
The waiver approval extends BadgerCare through the end of 2023, and although it allows the state to implement a work requirement for enrollees aged 19 to 49, CMS did not approve the state’s proposal to require drug testing as a condition of eligibility for Medicaid. Instead, Wisconsin revised their proposal to include completion of a health risk assessment as a condition of eligibility. People can be referred for substance abuse treatment based on their health risk assessments, but would not lose their Medicaid eligibility for Medicaid.
Wisconsin’s approved BadgerCare changes include:
- A Medicaid premium of $8 per month for childless adults with household income between 51 and 100 percent of the poverty level (for a single individual, that’s income between $6,070 and $12,140 in 2018). There would be an option for enrollees to reduce this premium by half if they either don’t engage in behaviors that create a health risk, or if they do but also attest to managing the behavior to improve their health.
- An $8 copay for use of the emergency department.
- Drug screening/testing as a condition of eligibility. Enrollees who test positive for drug use would be connected with treatment options, but would not lose their eligibility for coverage unless they then fail to complete substance abuse treatment (people in this situation would be allowed to re-enroll in Medicaid if and when they later opt to complete substance abuse treatment). Failure to comply with the drug screening/testing requirements, would, however, result in a person losing access to Medicaid. The state has also proposed increased coverage for substance abuse treatment, including full residential treatment as an option for all BadgerCare members. So a person who has to complete substance abuse treatment as a condition of retaining eligibility for BadgerCare would have access to that treatment via BadgerCare. The waiver notes that if treatment were not immediately available, the person would not lose access to coverage.
- Limiting BadgerCare eligibility to 48 months, starting when the new waiver takes effect, for non-disabled, non-pregnant enrollees age 19 to 49. After a person reaches a total of 48 months of coverage, BadgerCare eligibility would cease for six months. However, any month during which a BadgerCare enrollee is working or engaged in work training for at least 80 hours would not count towards the 48-month limit. Coverage in Wisconsin for childless, non-disabled adults is limited to those with income under the poverty level ($12,140 for a single adult in 2018), so avoiding the lifetime benefit cap while continuing to receive benefits would involve working enough to satisfy the 80-hour-per-month requirement, while not earning more than 12,140 during the year.
BadgerCare Plus — past and present
Prior to 2014, BadgerCare Medicaid had much more generous eligibility guidelines than programs in most other states. It was still limited to children, pregnant women, and parents with dependent children, but it covered them with incomes up to 200 percent of poverty level (300% for children and pregnant women).
Medicaid expansion under the ACA would have extended Medicaid coverage to everyone — including adults without dependent children — with incomes up to 138% of poverty. But the Supreme Court ruled in 2012 that states could not be penalized if they didn’t expand their programs, and Wisconsin Governor Scott Walker saw an opportunity to revamp the state’s Medicaid program, providing access to coverage for everyone while relying as much as possible on private coverage.
ACA subsidies to purchase private plans in the exchange are only available to people with incomes between 100 percent and 400 percent of poverty level. So Governor Walker decided to make BadgerCare available to everyone with incomes up to 100 percent of poverty level (pregnant women and children are still eligible with household incomes up to 300% of poverty level). This meant that about 83,000 adults without dependent children became newly eligible for BadgerCare on April 1, 2014.
But in trade, Walker’s plan called for switching to private coverage through the exchange for about 72,000 residents with incomes between 100 percent and 200 percent of poverty level. This group was comprised almost entirely of parents with dependent children, and they were eligible for BadgerCare Plus under the old rules. Although this group is now eligible for significant subsidies in the exchange, there are concerns among consumer advocates that the people who were previously insured through BadgerCare Plus might not have been able to afford private coverage in the exchange (including the out-of-pocket costs for claims), even with subsidies.
For the people who lost eligibility for BadgerCare, the exchange provided a special enrollment period that ran through the end of June 2014. But by September 2014, the state estimated that there were still 28,500 former BadgerCare members who had not enrolled in coverage through the exchange. As a result, a new special enrollment period was enacted, running from September 4 to November 2, 2014. Ultimately, the state estimated that less than 60 percent of the people who lost access to BadgerCare were able to transition to a private plan in Wisconsin’s exchange.
An expensive choice
By not accepting federal funding to expand Medicaid under the ACA, Wisconsin has missed out on billions in federal funding since the beginning of 2014. If the state had accepted Medicaid expansion to cover adults with income up to 138 percent of the poverty level, the federal government would have paid 100 percent of the cost through the end of 2016, and would be paying 94 percent of the cost in 2018. But because Wisconsin cuts off Medicaid eligibility at 100 percent of the poverty level, they aren’t eligible for the enhanced federal match provided by the ACA. Under the Obama Administration, some states proposed expanding Medicaid to 100 percent of the poverty level with full federal funding, but HHS did not agree to that provision, insisting that in order to receive ACA Medicaid expansion funding, states had to expand coverage all the way to 138 percent of the poverty level (133 percent, with a built-in 5 percent income disregard).
Because Wisconsin has taken a unique approach to partially expanding Medicaid, they have been paying more in state funds than they would if they had expanded Medicaid as called for in the ACA. Most states that opt for Medicaid expansion will end up with a small increase in their state budget over the next ten years (starting in 2017, the states pay 5 percent of the cost, increasing to 10 percent by 2020). But in Wisconsin, if Medicaid had been expanded as of 2014, the state’s Medicaid spending through 2019 would have been more than a billion dollars lower than the current path the state has chosen.
Who is eligible?
BadgerCare Medicaid is available for the following legally-present Wisconsin residents
- Pregnant women with household income up to 300 percent of poverty.
- Children 19 and under with household income up to 300 percent of poverty.
- Adults with household income up to 100 percent of poverty.
How do I enroll?
- You can enroll online at HealthCare.gov or the BadgerCare website.
- You can enroll by phone at 1-800-318-2596.
- You can also enroll in person or by phone at a local Wisconsin Income Maintenance Agency (this map shows the agency for each region – you can click on your region and it will show you the address and phone number of your local office).
- You can print a paper application and take it to your local Income Maintenance Agency or submit it by mail (the address to use depends on whether you live in Milwaukee County or not).
As of January 2018, there were 1,037,795 people enrolled in Wisconsin’s Medicaid/CHIP program, which was a 5 percent increase since the end of 2013, and virtually unchanged from late 2016. States that have expanded Medicaid have seen substantial increases in their Medicaid enrollment. Although Wisconsin did allow childless adults with income up to the poverty level to enroll starting in 2014, they cut eligibility for parents with dependent children whose income was between 100 percent and 200 percent of the poverty, offsetting much of the enrollment gains.
9.1 percent of Wisconsin residents were uninsured in 2013, and that fell to just 5.3 percent by 2016, according to U.S. Census data. Both of those numbers are lower than the national average; nationwide, the uninsured rate fell from 14.5 percent to 8.6 percent.
Although Wisconsin has not expanded Medicaid under the ACA, the BadgerCare Medicaid program has much more generous eligibility rules than most non-expansion state programs. So there is no coverage gap, and relatively affordable health insurance is universally available in Wisconsin.
Public support for Medicaid expansion
In the November 2014 election, voters in several counties approved expanding Medicaid, but the vote was symbolic – it was still up to newly-reelected Governor Walker and the state’s legislature, and they have not taken any steps in the ensuing years to change the state’s Medicaid eligibility.
Louise Norris is an individual health insurance broker who has been writing about health insurance and health reform since 2006. She has written dozens of opinions and educational pieces about the Affordable Care Act for healthinsurance.org. Her state health exchange updates are regularly cited by media who cover health reform and by other health insurance experts.