Michigan and Wisconsin highlight divide on Medicaid expansion


States are taking different paths after the Supreme Court's 2012 ruling on the Obamacare Medicaid expansion. (AP Photo/Evan Vucci)

While the health care world was fixated yesterday on the end of Obamacare open enrollment, Tuesday also marked the beginning of a new Medicaid era for two neighboring states that took very different approaches to the law's expansion of coverage for low-income individuals.

In Wisconsin, Republican Gov. Scott Walker pared back generous Medicaid eligibility while opening up the program to more of the state's lowest-income adults. In Michigan, Gov. Rick Snyder is using a federal waiver to implement the Affordable Care Act's expansion.

By coincidence, both programs started April 1. And both are a result of the 2012 Supreme Court decision making the Medicaid expansion voluntary for states.

First, let’s look at Wisconsin. The state’s Medicaid program had covered childless adults up to 200 percent of the federal poverty level, but not anymore. Walker, thought of as a possible 2016 presidential candidate, rejected Obamacare’s Medicaid expansion while also relying on the law’s subsidies for health insurance exchanges.

Under Wisconsin’s new Medicaid design, about 82,000 childless adults living under the federal poverty level are newly eligible. About 75,000 adults earning between the federal poverty level and 200 percent FPL were removed from the Medicaid program, known as BadgerCare in Wisconsin. They'll be eligible for federal subsidies to purchase exchange coverage.

The transition was originally scheduled for Jan. 1, but it was delayed in November when HealthCare.gov was still undergoing major fixes.

Wisconsin’s Medicaid plan is pretty unique. Walker rejected Obamacare’s far more generous federal match for the Medicaid expansion while managing to cover more of the state’s poorest residents. And there’s no eligibility gap like there is in other states that rejected the ACA's Medicaid expansion, since anyone above the poverty level can get coverage on the exchange. But will they find the exchange coverage affordable, even with the federal subsidies?

The key thing to watch is how many of those kicked off BadgerCare successfully make the transition to the exchange. Since they lost their BadgerCare coverage, they qualify for a special enrollment period that gives them until May 31 to sign up for an exchange plan. Wisconsin says they’re still waiting on the Centers for Medicare and Medicaid Services to provide reliable data on how many former BadgerCare enrollees made the switch to the exchange.

Meanwhile, Michigan’s version of the Medicaid expansion also took effect yesterday. Snyder, a Republican, fought his GOP-controlled legislature last summer to push through the expansion. But lawmakers refused to let it take effect earlier than April 1.

The Michigan expansion, eventually expected to cover about 470,000 residents, required CMS approval on some design elements. The state plan notably includes a provision requiring enrollees after four years to seek exchange coverage or share some of the costs to remain in the Medicaid program.

Interest in the Michigan program looks strong early on. By 4 p.m. Tuesday, the state reportedly received almost 12,000 applications for coverage.

The ACA drafters had envisioned a much more uniform coverage expansion for the country's poorest residents. The Supreme Court's decision, though, has made for many different Medicaid approaches across the country.

Jason Millman covers all things health policy, with a focus on Obamacare implementation. He previously covered health policy for Politico.
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