BadgerCare recipients brace for health insurance exchanges
Madison — When a potentially
fatal intestinal problem forced Bethany King into surgery in 2011, the
state's BadgerCare Plus coverage paidalmost all of the hefty bill.
But next year, the small business owner's income may rise just enough to
bump her from the Medicaid program into the federal insurance
marketplace being created under President Barack Obama's health-care
law, which King worries may further strain an already tight budget.
"It
is all the unknowns that bug me more than anything else," said King. "I
have had so much different information and basically everybody doesn't
know."
In less than three months,
these federal insurance exchanges will start signing up customers, and
tens of thousands of low-income BadgerCare recipients such as King, 31,
will find out how they fare in this complex and still poorly understood
system.
There may be a bright spot.
While the private coverage offered through exchanges will likely cost
more than BadgerCare, it may not cost as much as some advocates feared.
The question is key in Wisconsin, which is proceeding differently than
other states. Neighbors such as Illinois and Minnesota have expanded
Medicaid coverage to insure those making just over poverty level wages.
Here, about 90,000 people will be moved from BadgerCare coverage to the
federal system.
"It's
a huge change," said Bob Peterson, executive director of ABC for
Health, a public interest law firm. "For the hospitals, for the clinics,
for the people seeking care, it turns a lot of things around for them."
He said the exchanges' first few months will be a "white knuckle" adjustment.
Those
just over the federal poverty level, $19,530 a year for a family of
three, will face a complex choice about whether to purchase insurance to
replace their Medicaid coverage.
BadgerCare
offers low co-pays to those enrolled in its most subsidized coverage
and charges premiums only for a select group of adults making somewhat
higher incomes.
Under the federal health care law, Wisconsin could have used federal
money to expand Medicaid for those between 100% and 138% of the poverty
level and in the process boosted the state budget.
But Gov. Scott Walker and GOP lawmakers chose to put these consumers in
the private federal exchanges, saying they were concerned the federal
money wouldn't be available over the long term.
Walker spokeswoman Jocelyn Webster pointed out that the governor's plan
will actually bring a large group of childless adults onto BadgerCare
for the first time.
"Everyone
in Wisconsin will have access to affordable health care," Webster said.
"Governor Walker's plan will reduce the number of uninsured adults by
about 224,580, cutting the uninsured rate by nearly half."
Living on a tight budget
King
runs a home remodeling business, Madison Residential, with her husband.
She said she will purchase insurance. Her second surgery last year cost
at least $126,000, with all but about $100 covered by BadgerCare.
Needing to keep her income steady as she cares for her two young
daughters, she felt compelled to go back to work a little over a week
after her first procedure in May 2011.
"My clients all looked at me and were incredibly worried," she said. "It sucks, but whatever, you get over it."
For now, it's still unclear how current BadgerCare recipients will fare in the exchanges.
Sara
Eskrich, a health policy expert at the Wisconsin Council on Children
and Families, said her group tries to keep talks on the exchanges "as
broad as possible, to stay safe," highlighting the federal program's
premiums and potential for higher out-of-pocket expenses.
Eskrich said the state's decision not to expand Medicaid, however, was bad for low-income residents.
"When you are making $11,000 per year, and the majority of that is going to pay rent, every dollar counts," Eskrich said.
Walker's plan, according to
DHS, will bring more than 80,000 childless adults living in poverty into
BadgerCare, a slightly smaller group than those with higher incomes
being forced to leave the exchanges under Obamacare.
"The governor believes that
having more people depend on government-run Medicaid should not be our
goal. Rather, we want to help individuals and families living above
poverty to remain in the private sector for getting their health
insurance coverage," agency spokeswoman Claire Smith said.
What to expect
Under
the standard BadgerCare plan for adults with children, extremely low
co-pays — and not premiums or deductibles — are charged. Prescription
costs run between $0.50 and $3, and inpatient hospital care is $3 a day
up to a $75 maximum.
A different plan for childless adults has slightly higher prices.
The comparable costs for the exchanges still aren't fully known.
Except
for some people on the cheapest plan, coverage will require paying a
premium as low as 2% of income. The cheapest plan without a premium,
however, has far higher out-of-pocket expenses compared with the
coverage specifically aimed at low-income individuals. Co-pays must
still be set. Out-of-pocket maximums for those just over the poverty
line will be around $2,000 for individuals and $4,000 for families.
The exchange will offer four
main tiers of insurance that vary in price and quality. A special
category also will be available for those between 100% and 150% of the
poverty limit, where the insurer must on average pay 94% of health care
costs with the average patient picking up the remainder up to a limit.
In
2011, the Kaiser Family Foundation asked three insurance providers to
come up with the basics of a plan that would fit such a model in 2014.
The charges varied widely. The cheapest offer included no deductible and
8% coinsurance (the share of expenses paid by the consumer). The most
expensive had a $200 deductible and asked for 10% coinsurance.
Preventive care under the federal health legislation is fully covered.
California
has released some prices for its own state exchange, which specifies
what individuals will pay for specific kinds of services. That state's
estimates use the 94% value and ask individual consumers to pay $4 to
$10 for drugs and 10% of a physician or surgeon's fees for a hospital
stay.
These numbers, however, will
likely be somewhat different in a federal exchange like the one coming
to Wisconsin. But they do provide at least a glimpse into what's coming.
Coverage concerns
Rebecca
Nelson, a 39-year-old single mother of four living in Eau Claire, also
worries about getting removed from BadgerCare and facing cost increases.
She
has struggled with severe back and other medical problems — she moves
slowly, has trouble walking and can't sit in the same place for more
than a half-hour without pain.
On
June 5, her landlord knocked on her door and apologized as he handed
her a five-day notice saying she must either pay her eight months in
back rent or face eviction.
"(My 15-year-old son) went to his room. He started packing his stuff. He knew I didn't have the money," Nelson said.
On
medical leave now and living under the poverty line, Nelson said she
will likely earn enough to fall just over the line if she is able to
return to work next year and therefore be forced onto the exchange
market.
Democrats
have criticized Walker's decision to turn down the increased federal
Medicaid funding, which the nonpartisan Legislature Fiscal Bureau has
estimated would save the state about $340 million through 2021.
The
Walker administration has responded that its plan doesn't rely on
uncertain federal funds and that 93% of those with incomes between 100%
and 138% of the poverty limit will sign up for coverage under the
federal exchange. The fiscal bureau has said the assumption of a 93%
sign-up rate is "unreasonably optimistic."
As
for Nelson, she borrowed money from a friend and avoided eviction. But
in her case, the federal coverage may end up costing too much.
"It is still more than I would be able to afford," she said.
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