Tuesday, June 14, 2011

These Will Be The Sad Consequences Of The Walker Budget

Protect BadgerCare!
Minimize Budget’s Harm to

Wisconsin Families

Common Goal: Don’t Increase the Number of Uninsured!

The Save BadgerCare Coalition and leaders of the Department of Health Services (DHS) have a common
goal: don’t increase the number of uninsured! Problem is – DHS leadership and Congressman Paul Ryan
are backing plans that take Wisconsin in the wrong direction – toward higher costs, more uninsured
children and families, and more economic instability.

Governor Walker has proposed a $500 million cut in Medicaid over the next two years.

The Save BadgerCare Coalition urges State Legislative leaders to reduce the damage.

A $500 million Medicaid cut would force DHS to take the following actions:

. Increase out-of-pocket costs for Wisconsin families
o Consequence: Higher premiums mean more Wisconsin families lose coverage and become uninsured.
Urban Institute researchers showed that even a small premium (1% of a family’s income) decreased
enrollment by 16% when studying three states that changed premiums. Premiums of 3% of a family’s
income are estimated to reduce enrollment by as much as half.

. Make it harder for workers to get the care they and their families need
o Consequence: When low-wage workers have access to employer-sponsored insurance, it’s often
unaffordable. With BadgerCare harder to get and employer-sponsored care out of reach, these
Wisconsinites will become uninsured. Research by the Robert Wood Johnson Foundation found that
these sorts of measures do not increase private coverage1.

. Categorically deny coverage to parents and childless adults.
o Consequence: Unless Wisconsin gets a federal waiver, the budget would require DHS to drop
BadgerCare coverage for 63,000 parents and approximately 7,000 childless-adults, making these
Wisconsinites uninsured. For example, parents in a family of three or four, both working minimum
wage jobs, would be disqualified from BadgerCare.

. Make it harder for eligible children and/or pregnant women to enroll.
o Consequence: This could prevent some women from getting cost-effective prenatal care early in their
pregnancy and interrupt the continuity of care that gives babies a better chance at a healthy start.

1Blewett and Call, Robert Wood Johnson – The Synthesis Project, “Revisiting Crowd-Out,” September 2007.

The changes discussed by DHS are not specified in the biennium budget, as they would be made through
the authority of the budget repair bill, signed by the Governor on March 11th (and now in legal limbo).
Worse yet, the men, women and children who would become uninsured will have no say, because these
changes would be made with limited legislative oversight, transparency, and accountability, as
extremely broad authority to make changes to BadgerCare was transferred from the Legislature to the
Secretary of DHS. The Save BadgerCare Coalition is asking DHS to “show their cards” and make public
which changes they will propose making to Medical Assistance as soon as possible, to allow for public

In addition to increasing the number of uninsured Wisconsinites, the budget will result in cost shifting
that will make health care more expensive for every Wisconsin family and small businesses. Most of the
discussed actions by DHS to cut the $500 million will result in people not being able to enroll in and
maintain coverage, and thus joining the ranks of the uninsured. That loss of coverage among low-
income households is also likely to lead to unfavorable outcomes for providers, who might face
increased use of emergency rooms, a loss of revenue due to more uncompensated care, and “adverse
selection” (as cost increases depress participation by healthier individuals, which increases the average
costs for those who continue their coverage).

No preventive care/
Medical Home

More ER visits and higher
uncompensated care costs

Higher insurance premiums for
families and small businesses

Save BadgerCare recognizes the cost of health care and is committed to working with DHS to
eliminate inefficiencies and creatively generate revenue through real reform of Medical
Assistance, not just cost shifting.

Wisconsin’s BadgerCare Direction Budget Deal’s Direction

- Make it more difficult for
low-income families to
afford quality health care.

- Higher premiums,
increased cost sharing, and
reducing BadgerCare
eligibility will increase the
numbers of uninsured

- This will drive up
uncompensated care in
emergency rooms, resulting
in higher premiums for
other health care
consumers, and create the
problem of adverse

BadgerCare Plus was
enacted in 2007 with the
goal of enabling 98% of
Wisconsin residents to
have access to quality,
affordable health care.
BadgerCare Plus covered an
average of 686,105
Wisconsinites per month in
2009-2010, and now
provides health care
coverage to more than
750,000 women, men, and

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