Advocates for the poor, elderly and others covered by a host of Medicaid programs spoke out against the proposal that would lead to increased premiums and the shifting of hundreds of thousands of people into less costly state or private plans.
"This is scary stuff," said Karen Foxgrover, a volunteer advocate for people with disabilities. "I understand what you're saying that these are necessary cuts, but it doesn't make it any easier to swallow."
The changes are needed given the rising cost, loss of federal money and exploding enrollment growth in various Medicaid programs, which serve roughly 1.1 million Wisconsin residents, or one in five people.
"Doing nothing is not an option," DHS Secretary Dennis Smith said at the outset of the hearing.
Drew Hanson, 44, of Madison said he worried he couldn't afford insurance through the state's BadgerCare program for his 3-year-old daughter if premiums increased 5 percent as proposed. Hanson said he buys private catastrophic health insurance for himself and works part-time so he can be home to care for his daughter after his wife died two years ago.
"We're on a razor thin family budget," Hanson told Smith and Deputy Secretary Kitty Rhoades. Rising costs would force him to go back to full time work and not spend time with his daughter, Hanson said.
"With all due respect, I don't think it's fair to my daughter to suffer any more than she already has," he said.
The state Department of Health Services' plan calls for shifting more than 200,000 families enrolled in BadgerCare Plus into so-called benchmark plans that have fewer benefits and don't cost the state as much.
Doing that requires a federal waiver. Without it, the state plans to increase income eligibility requirements which would force more than 50,000 people out of the program through raising income eligibility requirements.
Without the waiver, the income cut off would be raised from 200 percent of the federal poverty level to 133 percent. Currently, a family of three earning up to $37,060 is eligible. Without the waiver, the cut off would drop to $24,645 for the same family.
BadgerCare Plus is designed to provide insurance to poor children, pregnant women and poor adults. It is funded with a combination of state and federal money.
The department also is proposing that premiums increase up to 5 percent for families making more than 150 percent of the federal poverty level.
The public hasn't had enough time to review or understand the complex proposed cuts, said Sara Finger, coordinator of the Save BadgerCare Coalition comprised of numerous health care providers and consumers, public policy experts, disability rights advocates, and others. The proposed cuts were made public Sept. 30 and comments could be submitted on the website since then. Wednesday's hearing was the first of two, with the final one set for Friday in Milwaukee.
Rhoades, the agency's deputy secretary, said before the hearing that the plan was to submit its final proposal to the Legislature's budget committee as early as Monday. Smith said the federal waiver would be sought as soon as possible once the budget committee signs off on it.
The Republican co-chairs of the Legislature's budget committee have called the agency's recommendations encouraging. Democratic lawmakers who don't have the votes to stop approval have said the changes would hurt working families.
The federal waiver would also give the state permission to declare that individuals and families would no longer be eligible if they have access to affordable employer-based insurance plans.
The waiver also would clear the way for the state to require young adults between the ages of 19 and 26 to join their parents' or other private insurance plans. DHS estimates that would move about 6,500 people off of state-funded Medicaid plans.
None of the changes being sought would affect SeniorCare, the state's popular prescription drug discount program for seniors.
The department's plan is designed to save more than $500 million by mid-2013.