Gov. Scott Walker’s outgoing health secretary responded to criticisms of Walker’s Medicaid proposal at a Tuesday health care conference.
ABC for Health’s annual health care conference included a panel of five Democratic legislators—no Republicans accepted the group’s invitations. But Department of Health Services Secretary Dennis Smith responded to criticisms Walker’s plan covers less people, yet costs the state more.
Sen. Jon Erpenbach, D-Middleton, said he has had conversations with some moderate Republicans who have some concerns about parts of Walker’s plan.
The Republicans have an 18-15 majority in the Senate, so Democrats would need two Republicans to stop Walker’s plan. Senate Minority Leader Chris Larson, D-Milwaukee, pointed out some Senate Republicans have realized Walker’s intentions are often political and “not the best” for taxpayers.
Walker’s plan would move 87,000 childless adults currently without insurance to Medicaid and move 82,000 parents out of Medicaid into private insurance exchanges.
Under his plan, those under 100 percent of the poverty level are eligible for Medicaid, and those above would be in private insurance plans. Those between 100 percent and 400 percent of the poverty level would get some federal subsidies.
Walker’s plan would reduce the uninsured by 224,850, a number Democrats pointed out is 28,000 less than their proposal of taking a full Medicaid expansion.
Democrats also pointed to the fiscal impacts of Walker’s decision. A preliminary analysis from the Legislative Fiscal Bureau showed Walker’s plan would cost the state $320.3 million by 2020, while the Democrats’ plan would cost it $66.7 million.
The analysis does not take into account administrative costs or a “woodwork effect” of more people than expected signing up for Medicaid.
The cost differences come from the Democrats’ use of federal funds for the expansion, for which the state would never pay more than 10 percent of the costs. Under Walker’s plan, the federal government would pay $460.6 million by 2020, but the Democrats’ plan would cost the federal government $4.38 billion.
Smith said the federal government is likely to break its funding promise because of its debt problems. He also pointed to the more than $200 million more the state has to pay because of decreased federal funding for the state’s current Medicaid program.
The federal government has also proposed cuts to Medicaid in the past, Smith said. Although they are now only proposing Medicare cuts, he said providers would shift those cuts over to Medicaid recipients. The federal government is also looking to prevent states from collecting a tax on providers, which Smith said would end up leading to more costs for the state.
Smith also said since the total costs are the same under each plan, the same money would be spent in the state. As Medicaid offers lower payments to doctors, he added, the state’s economy would grow more as more people have private plans.
“The total cost would be the same, so whatever that impact is has no bearing on the loss of jobs [and is not] detrimental to the state economy,” Smith said. “It just doesn’t work that way. Moreover, we believe the total economic impact is likely to be greater under the governor’s proposal.”
The insurance exchanges are affordable, Smith said, pointing to the lowest premium of $19 a month for an individual making 100 percent of the poverty level. He also cited figures that showed most Medicaid enrollees have stayed in the program despite some premiums.
Smith said Walker should get more credit for ensuring those under 100 percent of the poverty level get insurance, as many childless adults are currently on a wait list to get into the current Medicaid program.
Medicaid expansion advocates maintained Walker could cover more people with less state money under their proposal.
“This is a significant opportunity for the people of Wisconsin to extend and expand coverage to some of the neediest folks in our state and save the taxpayers some money,” ABC For Health Executive Director Bobby Peterson said.
Walker’s proposal does not affect children. But, Peterson said, splitting parents and children between private insurance to Medicaid would lead to “double bureaucracy” and possibly more uninsured people.