By the Numbers: A Closer Look at the BadgerCare Cuts Approved Friday

As you have probably heard by now, federal officials notified the Wisconsin Department of Health Services (DHS) late on Friday that the state will be allowed to make significant cost-cutting changes to BadgerCare. We’ve been gathering information about the human and fiscal consequences of the cuts, which will start taking effect on July 1, and here’s a compilation of some of the key numbers from the preliminary estimates:

• $28 million – State General Fund spending reduction resulting from the approved changes;
• $42 million – Loss of federal Medicaid matching funds because of the cuts to BadgerCare;
• $0 – Amount of federal match the state gets if hospitals experience a jump in spending for uncompensated care;
• 17,000 – Approximate number of adults expected to lose their BadgerCare coverage;
• 64,748 – DHS estimate of number of people who would have lost their BadgerCare coverage if the original DHS plan had been approved;
• 48,000 – The latest DHS estimate of number of BadgerCare recipients who will pay higher premiums because of the changes;
• 29,000 – Number of children who could lose BadgerCare coverage if the "maintenance of effort" (MOE) requirements in the health care reform law are repealed or struck down by the Supreme Court;
• 305,000 – WCCF estimate of number of people who could have much higher co-pays and narrower BadgerCare benefits if the Alternative benchmark plan is approved.

A daily e-mail from Governing, which provides highlights of news items from across the nation, contains the following heading: “Feds OK Wisconsin Gov. Walker's Plans to Cut Medicaid Costs.” That’s somewhat misleading because although federal officials did approve a significant portion of the Governor’s plans, the figures above help illustrate that HHS refused to allow most of  the Governor's proposals.  Thanks to the maintenance of effort (MOE) requirements in the Affordable Care Act (ACA), the number of people expected to lose their BadgerCare coverage is only about a fourth of what it would have been if the Governor's full plan had been approved.

A new WCCF paper examines the DHS claim that the BadgerCare changes are consistent with the ACA and will provide an early test of portions of that law. The WCCF analysis explains that although it is accurate to say that the imminent changes are allowable under federal law, there are very substantial differences. It explains several discrepancies in important policy details that will result in thousands more people losing their BadgerCare coverage than would be the case if Wisconsin closely followed the ACA and was truly interested in testing its provisions.

More importantly, the new WCCF paper discusses the striking contrast between the goals of the ACA and the objectives of the BadgerCare changes.

Jon Peacock