Will Wisconsin’s Health Coverage for Childless Adults Wither Away?

Wednesday, April 25, 2012 at 6:08 PM by

Letter to HHS Argues that State Must Lift the Current Freeze

I’ve been very surprised that so little attention has been paid to the plunging participation in Wisconsin’s BadgerCare Plus Core Plan, which provides modest health care coverage for adults who don’t have dependent children. As the following chart shows, enrollment in the Core Plan peaked at more than 65,000 in January 2010, and it has declined rapidly since then, to about 26,800 last month – a drop of 59 percent. In the last 12 months alone, BadgerCare Core participation has fallen by more than 13,000.

The decline is caused by the combination of monthly attrition and a freeze on new Core Plan enrollment, which was imposed in the fall of 2009 when then unexpected number of applications was pushing participation well beyond the budgeted level. The Wisconsin Department of Health Services (DHS) initiated a waiting list at that time, and that list has now grown to more than 128,000!

The freeze didn’t simply cap enrollment; it imposed a moratorium on adding people to the program until spending fell far enough to allow DHS to begin removing people from the waiting list. The state is well past that point, but it is becoming increasingly apparent that the Walker Administration has no intention of ending the freeze, despite the fact that Core Plan enrollment is now more than 16,000 people below the level that was anticipated in the 2011-13 budget bill. When the Core Plan participation and spending projections were arrived at (almost a year ago), it was assumed that the state would periodically take people off the waiting list to maintain an average monthly enrollment of 43,000.

An April 24th letter to the federal Dept. of Health and Human Services (HHS) by state Representatives Jon Richards and Tamara Grigsby argues that Wisconsin is required to end the freeze, based on the terms of the Core Plan waiver, and it asks HHS to consider whether the freeze violates the maintenance of effort (MOE) requirements in the Affordable Care Act.  Perhaps we will get a response to that argument within the next week or so, when HHS acts on the cost-cutting changes to BadgerCare Plus proposed by the Walker Administration.

The effects of the precipitous drop in Core Plan enrollment are felt across the state, but they are particularly exasperating for health care providers and advocates in Milwaukee County because the Core Plan replaced the former General Assistance Medical Program (GAMP). The Milwaukee County Executive at the time, Scott Walker, supported the creation of the Core Plan, which capped the county’s costs – relieving the county of any responsibility for increased spending to provide health care to childless adults. The conversion from GAMP to the Core Plan now looks like a “bait and switch” to people in Milwaukee, especially since the rapidly declining Core Plan enrollment in that county is now well below the number of childless adults served by GAMP when those individuals were moved into the Core Plan (in Jan. 2009).

The freeze is also vexing for hospitals (and their patients) because the Core Plan waiver agreement the state reached with HHS a few years ago finances the 60% federal share of Core Plan spending from the federal funding for “disproportionate share hospitals” (DSH), which serve a disparate portion of the uninsured. As the Core Plan participation plunges and the waiting list soars, hospitals are spending a lot more for uncompensated care for uninsured adults, yet they no longer have access to the federal DSH funding that has been set aside for Core Plan spending.  The hospitals are losing out, and so are their patients, since a significant portion of the cost of uncompensated care is spread to patients with insurance.

Although most of the media seem oblivious to the significant decline in Core Plan enrollment and the related policy debate, I have to tip my hat to Wisconsin Public Television for their coverage of the issue Friday evening.  One portion of that coverage, Frederica Freyberg’s interview with Bobby Peterson of ABC for Health, can be read or viewed on the “Here and Now” website. And for more on the creation of the Core Plan, see Guy Boulton’s October 2008 Journal Sentinel article.

We’ll continue to track this issue as HHS acts on the proposed BadgerCare waivers and plan amendments and as the Wisconsin DHS makes its plans clearer.

Jon Peacock

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