Friday, February 15, 2019

The "Other" Wisconsin: Why Medicaid Expansion is the Smart, Compassionate, and Fiscally Responsible Thing to Do

By Tom Frazier

If a man from Mars had watched Governor Ever’s State of the State address, and the Republican response given by Speaker Vos, I believe that he would have concluded that they were talking about two different states.

In a way, they were.

I think that Speaker Vos was talking about the Wisconsin where well-to-do individuals and corporations are thriving in our economy, and Governor Evers was talking about the “Other” Wisconsin where people such as children, minorities and lower income are not thriving and, therefore, need help with things like healthcare. Unfortunately, there are too many people still living in the Other Wisconsin and we need to stop ignoring them.

Perhaps nothing illustrates this dichotomy more than the issue of Medicaid expansion that the Governor plans to include in his 2019-2021 state budget, and that the Speaker is adamantly opposed to. As a part of the Affordable Care Act (ACA) states could choose to expand the Federal/State funded healthcare program for the poor by increasing the income eligibility to 133% of the Federal Poverty Level (FPL). As an incentive the federal matching rate would be 100% for the first few years gradually decreasing to 90% in 2020 and beyond. This compares to the average Wisconsin rate of 58-59%.

According to the Legislative Fiscal Bureau, a nonpartisan legislative agency, Wisconsin could have increased federal funding by $2.8 billion and saved $1billion in state tax money if it had started full expansion (133% FPL) on April 1, 2014, the date the state started partial expansion (100% FPL). The savings results from the significantly higher federal matching rate that did not apply to partial expansion.

I remember a time when previous Governors would have “laughed all the way to the bank” with a deal this good.

Also, if you are thinking why people above the FPL should be eligible, it is because the FPL is very low with 133% being only $16,612 annually for an individual and $34,248 for a family of four. The Legislative Fiscal Bureau estimates that 76,000 more people (a little more than the population of the City of Waukesha) would be eligible for Medicaid healthcare under full expansion.

Even though Wisconsin has missed the opportunity for the huge increases in federal funds and huge savings in state funds, there is still a big upside to expanding Medicaid in the 2019-2021 budget. Again, the Fiscal Bureau indicates that full expansion in the next state budget would add $793 million in federal funds and a savings of nearly $280 million in state tax dollars. The state savings could then be used for other state priorities such as transportation, education, or healthcare.

Speaker Vos claims that Medicaid expansion is “socialized medicine” or “government run healthcare.” It isn’t either. Medicaid healthcare is provided by private doctors, clinics, and hospitals. Doctors may choose whether or not to participate in the Medicaid program. Just as Foxconn, a private corporation, could have chosen not to accept $4billion from state and local governments. In both cases, Medicaid and Foxconn, the government is contracting for something of value and if one is Socialism so is the other one.

In 1962 Michael Harrington authored a book entitled The Other America that was a study of poverty in the United States. The book is credited by some people for influencing the development of healthcare programs such as Medicare and Medicaid. Now the issue of healthcare is back in the national and state spotlights because we need to improve upon what was initiated back in the 1960s. The benefits from Medicaid expansion to lower income families and the state are pretty obvious but as long as some politicians can’t see that there are thousands of Wisconsin citizens who live in the Other Wisconsin, where they are unable to thrive, it will be harder than it should be.

Having access to healthcare will help them thrive if we are smart, compassionate, and fiscally responsible.

Tom Frazier is a member of the Common Cause in Wisconsin State Governing Board, and was the executive director of the Coalition of Wisconsin Aging Groups from 1983 to 2010.

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