Remember that sweater Grandma gave you for Christmas when you were eight years old, and your mom gave you that look that said if you didn’t give a sincere thank you the GI JOE doll under the tree would be given to your little brother? Senator Harry Reid and the Democrats in the US Senate have scheduled the vote on their version of health care reform for Thursday night at 8:00 PM central time. Thanks Grandma.
The Senate health care reform plan is full of lots of goodies for those who were nice to Senator Reid in finding him the 60 votes necessary for the vote in the dark of early Monday morning that would limit debate. Unfortunately for many states, the Senate health care reform bill will increase Medicaid costs as the program expands nationally to cover those under 133% of the federal poverty line.
If you are wondering why Senator Ben Nelson of Nebraska gave in to his Democratic colleagues to become the 60th vote necessary to limit debate on the health care bill, Nebraska will receive 100% funding from the federal government to cover the expansion of Medicaid in that state.
In Wisconsin, we could have used that kind of relief for our versions of Medicaid, Badger Care Plus (including the Core Plan). It is unlikely that Wisconsin’s burden from Medicaid will go up under the new federal health care plan. Not because either Senator Feingold or Senator Kohl was able to cut a deal, but because Wisconsin already spends so much on state run health care. To make matters worse, Wisconsin’s Medicaid programs are $1 billion behind.
If we were to join the rest of the country in providing health insurance for those that are at 133% of the federal poverty line, we would actually be reducing the rolls of Medicaid recipients in Wisconsin. Only 17.2% of Wisconsinites would qualify for Medicaid coverage under the current federal health care plan.
That sounds like a lot, but with the expansion of government coverage in Wisconsin since 1998, nearly one in five Wisconsin residents is receiving Medical Assistance, and enrollment in the state’s Medicaid programs has jumped 174%, according to the Wisconsin Taxpayers Alliance. In 1998, less than one in thirteen residents received medical assistance.
Wisconsin’s Badger Care Plus generally covers residents at 150% of the poverty line, although there are exceptions that even go up to 300% of the federal poverty line. The Core Plan covers childless adults up to 200% of the poverty line if they do not qualify for any other federal assistance, again substantially higher than what other states will be covering.
In an effort to contain costs on the state’s Medicaid programs, the state budget planned on $600 million in cost savings in the current budget biennium. However, $195.4 million are from one-time savings that will have to be covered in the next biennium. We’re putting off to tomorrow what we should be paying today, only making what we have to pay tomorrow even bigger.
The current budget also relies upon temporary increased federal matching, $317 million, as a result of the federal stimulus bill. There is a bill in congress to extend the increased matching through June 2011, but then the stimulus funding would need to be replaced for the 2011-2013 biennial budget.
Now Wisconsin is experiencing higher-than-expected enrollment in our Medicaid programs because of the economy, and we’re experiencing an additional shortfall of $450 million. Enrollment in Badger Care Plus has leveled off for now, but it is still higher than planned.
So the news the Core Plan can no longer afford to add new enrollees, and that Wisconsin now has a waiting list looking for state medical assistance, should come as no surprise. As of November 14th, there were 7,434 people waiting on the Core Plan wait list.
We don’t need one of senators to blackmail the senate for more money, although it would help in the short run, we need to start promising less.
Unless Wisconsin gets control of its Medicaid costs soon, it will be the monster that eats the state budget.
By James Wigderson
Special Guest Perspective for the MacIver Institute