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Wednesday, Oct. 30, 2013

Obamacare in Wisconsin: Can We Make the Affordable Care Act Work?

Scott Walker missed opportunities to expand coverage

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It’s been a rough couple of weeks for Obamacare.

Yes, the Affordable Care Act survived a defunding attempt that crippled Washington. But the troubled launch of the federally run ACA’s online insurance exchange has had even its staunchest supporters unhappy.

“No one is more upset about it than advocates for guaranteed affordable health care,” said Robert Kraig, executive director of Citizen Action of Wisconsin. “It’s completely unacceptable.”

Unlike many other governors, including Republican leaders of red states, Gov. Scott Walker refused to fully participate in the ACA, so Wisconsin is relying on the federal exchange (healthcare.gov) instead of a state-created one. The result is an overburdened website that the state has no control over.

“It’s unfortunate that it’s not working out as we’d hoped,” said state Rep. Sandy Pasch (D-Shorewood) of the glitch-filled healthcare.gov. “But I have to look at the state and their responsibility for it too. My understanding is that the state-run exchanges are running better than the federal exchange. And we had the opportunity to do that.”

 

Walker Blocks Full ACA Benefits

That’s not the only opportunity Walker’s Wisconsin failed to seize. Instead of embracing the ACA, Walker has done the bare minimum to comply with federal law.

When Walker became governor in 2011, he wasn’t completely opposed to the ACA. He terminated former Gov. Jim Doyle’s ACA efforts and formed the Office of Free Market Health Care, which took a conservative approach to ACA implementation. In addition, the Republican-dominated Legislature began working on a state-run insurance exchange, because the GOP saw an advantage in having Wisconsinites controlling the state’s health care and insurance marketplace instead of the feds.

Then Walker shut it all down. Late last year, Walker announced that he was pulling the plug on his Office of Free Market Health Care, wouldn’t allow the state to set up the exchange, and wouldn’t accept the full federal funding for Medicaid expansion that would cover impoverished Wisconsinites. He also returned $37 million in federal grant money to run the exchange and, separately, signed a bill that banned insurance plans in the exchange from covering abortion services, except in cases of rape, incest or severe harm to or death of the woman.

“This whole thing has been really frustrating,” said state Sen. Jon Erpenbach (D-Middleton), a member of the Senate’s health committee. “I think it’s been frustrating intentionally because Scott Walker doesn’t like it and therefore will do whatever he can to make sure Wisconsin understands that this is not going to work in this state.”

Advocates for reform have continued to push Walker to accept the federal Medicaid funding, and 20 counties, including Milwaukee County, have passed resolutions asking that the state allow counties to receive the funds and expand Medicaid locally.

“It’s my understanding that he can change his mind at any time,” Pasch said.

Kraig said Walker’s opposition to the ACA is political. Not only does it burnish his tea party credentials as he eyes a run for the presidency, but the governor is attempting to reduce voters’ loyalty to President Obama and Democrats in the future, Kraig said. Walker and his fellow conservatives are afraid that Americans will appreciate Obama and the Democratic Party for providing a way to purchase affordable health care.

“That’s one of the reasons the conservative political leaders have fought so hard,” Kraig said.

Walker’s press office didn’t respond to the Shepherd’s request to comment for this article.

 

Browsing Before Purchasing

It’s important to note that the Affordable Care Act is far more than the insurance exchanges and expanded Medicaid coverage. The ACA includes vital consumer protections—some are already in effect—and will assure that all Americans have access to reasonably priced health insurance.

Thanks to Obamacare, young adults can be covered under their parents’ plan. Insurance companies cannot charge women more for standard coverage, and they’ll have to spend at least 80% of their premiums on health care, not profits or administrative costs. Standard preventive care must be provided without out-of-pocket charges. Those with pre-existing conditions—ranging from a previous pregnancy to mental health issues—cannot be charged more for their coverage. Moderate- and low-income Americans can receive subsidies for their insurance costs. And small businesses will be able to purchase insurance for their employees without being gouged by insurance companies.

That said, the ACA’s most visible component to date—the health insurance exchanges, where consumers can compare and purchase private insurance plans—has gotten off to a rocky start.

The federal website, healthcare.gov, was launched on Oct. 1, although it didn’t work. Headlines were filled with its failure to enroll anyone, although the state-created exchanges seemed to be running smoothly.

Tweaks and improvements are being made daily. As of last week, individuals could set up accounts, which enable them to enroll in a plan when the enrollment portion of the site is ready. In addition, visitors to the site could view and compare insurance plans and prices without setting up an account or enrolling.

More than 700 individuals have contacted the city’s ACA outreach sites, according to Jessica Gathirimu, the director of the Family and Community Health Services Division at the city of Milwaukee Health Department.

Yet no one has signed up for an insurance plan through the city, she said.

A sign of failure?

Not all at, she said.

Some who inquired about the exchanges qualify for Medicaid and cannot purchase private insurance on it. Gathirimu said the city would help them enroll in Medicaid instead. Others, she said, were content to browse through the plans before purchasing—a smart decision, given its importance and the variety of plans offered on the exchange.

“It can be overwhelming,” Gathirimu said. “I think there are 89 plans. So far, people have elected to take the information and think about it before buying a plan. They have plenty of time to make a decision.”

Individuals have until Dec. 15 to purchase a plan so that coverage will begin on Jan. 1, 2014. Those purchasing a plan after that date will not be covered until February 2014.

Those with questions about the ACA can call the Milwaukee Health Department at 414-286-8620 or Milwaukee County’s hotline number, 211.

 

Paying a Premium?

Although Wisconsin has nothing to do with the architecture of the exchange’s website, the state insurance commissioner, Ted Nickel, is responsible for vetting the plans offered on the site.

Last week, Citizen Action of Wisconsin charged that Walker’s anti-ACA stance and Nickel’s hands-off attitude have resulted in unusually high premium costs on the Wisconsin exchange, compared to those in Minnesota, even though the two states’ medical costs are roughly the same.

The report, released last week, found that Wisconsin’s premiums on the exchange are 79%-99% higher than the premiums on the Minnesota exchange, which is run by that state. On average, Wisconsin consumers on the exchange will be paying about $1,000 more than our neighbors in Minnesota. For those buying the “silver plan,” the mid-level plan, that difference rises to $1,824.

Kraig and his co-author, Kevin Kane, argued that Wisconsin’s higher rates can be chalked up to Walker’s refusal to fully expand Medicaid and Nickel’s failure to do a “robust rate review” to ensure that insurance companies aren’t gouging their customers.

“They see themselves as representing the insurance industry, not helping consumers,” Kraig told the Shepherd.

J.P. Wieske, Nickel’s spokesman, said the Citizen Action report was flawed and only used data from the Minneapolis-St. Paul area.

“They aren’t comparing apples to apples,” Wieske said.

Kraig, though, countered that his report used state-level data provided by the federal government showing the average costs for Minnesota, and stood by the report’s conclusions.

 

BadgerCare Changes

Walker has developed his own type of Medicaid reform, which will result in an estimated 92,000 primarily low-income parents being kicked off of BadgerCare at the end of the year while at the same time having roughly 80,000 childless adults under the poverty line potentially added to BadgerCare. This “transition” will cost the state taxpayers $119 million more in the next two years alone to insure more than 80,000 fewer people under the federal Medicaid expansion. Walker is hoping that former BadgerCare recipients will sign up for private insurance on the exchange, where they will qualify for a subsidy.

The state Department of Health Services (DHS) has begun notifying BadgerCare recipients that they will not qualify for the program in 2014 and has hired more than 80 people to help with the transition. DHS spokeswoman Claire Smith told the Shepherd that the department has sent letters to 56,246 households that will lose their BadgerCare coverage at the end of the year. As of Oct. 14, DHS sent letters to 163,808 people on the BadgerCare Core Plan wait list. It’s also making roughly 5,500 follow-up calls to letter recipients each day and will leave a voice mail message on the third phone attempt.

“The Department of Health Services has been working to fulfill all of its obligations to comply with the law,” Smith emailed the Shepherd. “We may not agree with it, but we’re all in this together to operationalize the law and we believe it’s our duty and responsibility to make sure that Wisconsin residents have the information they need to access public and private health insurance options available in 2014.” 

But is that enough?

“The state calls this ‘transitioning,’” said Bobby Peterson, executive director of the public interest law firm ABC for Health. “They’re transitioning them into a corn maze.”

Peterson predicted that many BadgerCare recipients wouldn’t be able to make the “transition,” which will result in more uncompensated care and higher insurance rates. He said there was still time to accept the full Medicaid funding and prevent massive BadgerCare coverage disruption at the holidays.

“But Walker would have to admit that he’s wrong, and he won’t do that,” Peterson said.

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