Budget bill gives Walker more power over Medicaid programs
Advocates fear effect on programs for about 1 million Wisconsin residents
The major question: how the governor's Department of Health Services will use that authority as it cuts a projected $466 million in costs from the programs over the next two years.
"We don't know exactly what will be coming down the pike," said Bob Jacobson, a spokesman for the Wisconsin Council on Children & Families. "And we don't know how we can have a voice in those decisions when the Legislature has been taken out of the picture."
The pending cuts work out to about 3% of the $14 billion in state and federal dollars allocated for the programs over the biennium.
The federal government pays about 61% of the cost of BadgerCare Plus and other Medicaid programs.
The budget-repair bill passed earlier this year gave the Department of Health Services the authority to make changes in the programs without legislative approval but required the department to hold public hearings.
The budget bill passed last week dropped the public hearing requirement. The exemption would remain in effect throughout the governor's term.
The pending changes in the programs could range from new rules on eligibility and cost sharing to managing care for people with severe mental illnesses.
The goal is to find ways to save money without limiting eligibility by making the programs more efficient, said Kitty Rhoades, deputy secretary of the Department of Health Services.
She stressed that the department is committed to being transparent and open about changes in the programs.
"There's a conspiracy theory that we have a plan in our drawer and we are going to bring it out on July 1," Rhoades said. "That's not true."
The Department of Health Services also won't have complete freedom.
It still must give notice to the Joint Finance Committee - the legislative budget-writing committee - of pending changes in the programs. The committee then has 14 days to decide if it wants to hold hearings.
In addition, Medicaid programs are jointly financed by the state and federal government, and Wisconsin must receive federal approval to significantly change the programs.
The national health care reform law requires states to maintain eligibility for Medicaid programs until 2014, and whether the Obama administration would approve significant changes is a question. Last week, Walker was among 29 Republican governors who asked Congress for more flexibility in how they structure their Medicaid programs.
The federal restrictions haven't lessened advocates' concerns about the authority given to the governor and Department of Health Services.
"It's a terrible precedent," said David Riemer, director of Community Advocates Public Policy Institute.
State legislators, he said, basically have given the governor the power to undo laws on books for the programs.
"The Legislature just sort of capitulated," Riemer said.
It also enables state legislators to sidestep some potentially controversial decisions.
"This makes it very difficult for the public to hold their elected officials accountable for these decisions," Jacobson said.
The Legislature approved a similar proposal during the Doyle administration when it instructed the secretary of the Department of Health Services to find more than $600 million in budget cuts. But Jacobson and others contend the authority given to the department then was more limited.
In the backdrop of all this is that no one knows how the department plans to find the $466 million in savings over the next two years.
Walker significantly increased funding for BadgerCare Plus and other Medicaid programs in his proposed budget. The joint finance committee subsequently added about $100 million to the governor's request.
The increased funding proposed by the governor was needed to replace federal money that up to now helped states avoid severe budget cuts to their Medicaid programs during the economic downturn and weak recovery. The additional federal money - $535 million in the state's current fiscal year - ends on June 30.
Enrollment in the programs has jumped as people lost their jobs during the downturn.
Nearly every state faces similar challenges.
But Jon Peacock, research director of the Wisconsin Council on Children and Families, said that six months into the governor's term, people still don't have specifics on what the administration will propose.
"Let's be open about what the options and alternatives are," Peacock said. "Tell us what is the plan."
Riemer said the Walker administration could put forth excellent proposals on how to make the programs more efficient.
"We just have to see what the specifics are," Riemer said. "Nobody knows. I'm not even sure they know."
Rhoades doesn't dispute that.
"We are finding our way," she said. "We are going to have a long summer of intensely hard work."
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