Can Wisconsin expand coverage without Medicaid? Governor Walker thinks so.

February 13, 2013

This just in from the Wisconsin State Journal: Wisconsin Gov. Scott Walker says his state will not participate in the Medicaid expansion. He instead has a completely different plan to cover Wisconsin's uninsured — and, as his spokesperson explained to me moments ago, it seems to have legs.


(Darren Hauck/Reuters) Wisconsin Gov.  Scott Walker

Wisconsin is in a bit of a weird position. Before the Affordable Care Act passed, it was one of just three states providing coverage to childless adults up to 200 percent of the federal poverty line ($22,240 for an individual). There are a few caveats here: The benefit package is more limited than what is offered to other Medicaid enrollees and it has had an enrollment cap since 2009, which means it limits the number of enrollees who use this coverage.

Most states provide Medicaid coverage to pregnant women, the disabled and children. Some include low-income parents. But very few offer coverage to childless adults. That's why the health law's Medicaid expansion is such a big deal: It will expand coverage to everyone under 133 percent of the poverty line.

In effect, Wisconsin provides a lot of the Medicaid coverage that is new to other states. And it will keep doing that moving forward: Medicaid coverage will be available to all Wisconsinites under the federal poverty line, reopening that program for low-income adults who had previously had an enrollment cap.

"We now cover childless adults up to 200 percent," Walker spokesman Cullen Werwie tells me. "We've dialed that back to 100 percent."

Those living above poverty will be moved into private health insurance via the Obamacare exchanges. There, they will be eligible for heavily subsidized health insurance coverage. Walker's office estimates that, under this approach, the state will extend health insurance coverage to just over 224,000 Wisconsinites.

That's not quite as many as would gain coverage under the Medicaid expansion, although it's relatively close: 224,580 instead of 252,678. The premiums for those who ended up purchasing coverage on the exchange, instead of receiving it through Medicaid, are relatively low for those right at the poverty level. They would increase as income went up.

With this approach, Wisconsin will miss out on one of the most appealing features of the Affordable Care Act: the federal government footing the entire bill for Medicaid enrollees newly eligible under the health reform law.

Wisconsin will instead receive its regular match, with the federal government paying 60 percent of the Medicaid program and the state financing 40 percent. As to why a 60 percent match is better than the federal government paying the entire bill, spokesman Werwie says that Walker expects that enticing match will ultimately get cut back and that could leave Wisconsin on the hook for a bigger chunk of the Medicaid bill than it ever expected.

"We don't expect that match will be there in the future," Werwie says. "So we think this is a better option."

Gov. Walker is the 13th governor — all Republicans — to decline to participate in the Medicaid expansion. There are six Republican governors who have signed onto the program.

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Dylan Matthews · February 13, 2013