Why Wisconsin Needs to Expand

WHY WISCONSIN NEEDS TO Expand BadgerCare

BY EVAN GOYKE

The most important single issue in the current state budget debate is again the decision to expand BadgerCare. This is not a new issue, and many readers will be familiar with the policy. However, the recent passage of the American Rescue Plan Act in Washington has increased the urgency of this decision. Here’s how it all works.

Passed back in 2010, the Affordable Care Act (ACA) has cut the number of uninsured Americans in half. One way the ACA accomplished this was through incentives to states to expand Medicaid eligibility to cover more people. States that expand eligibility for Medicaid, called BadgerCare in Wisconsin, receive a larger share of federal funds to administer the program. Thirty-eight states and the District of Columbia have taken advantage of this to date. This decision is specifically about “childless adults”—individuals between 18-64. We currently cover a single person earning about $12,500 a year. The expansion would cover a single person earning about $17,700 a year. These are working people, but still living in poverty. This is not a welfare program; it’s a health insurance program. Roughly 90,000 people would become newly eligible for the program and about half of those currently have no health insurance at all.

Increasing the federal government’s share of this program is a big deal. Over the next two years it is estimated that expansion will save the state roughly $630 million. When the federal share goes up, the state’s goes down, which frees this money to be used elsewhere. Governor Evers’ proposed budget reinvests these savings within our healthcare systems in ways that benefit all Wisconsinites.

INCENTIVES TO ACT NOW

That’s more than enough to get my vote, but Congress has upped the stakes. As part of the American Rescue Plan Act, the 12 states that have not yet expanded Medicaid eligibility will receive an even larger incentive if they do so now. This larger incentive comes again in the form of an increased federal share of the program and is estimated to reduce the state’s share by roughly $1 billion over the next two years. This is one time money, available only now and only through expanding BadgerCare. And while this is one-time money, it is our money and we are free to use it, save it, or invest it as we see fit.

Add those numbers together and the single decision to expand BadgerCare is a $1.63 billion decision. That’s $1,630,000,000.

ROUGHLY 90,000 PEOPLE WOULD BECOME NEWLY ELIGIBLE FOR THE PROGRAM AND ABOUT HALF OF THOSE CURRENTLY HAVE NO HEALTH INSURANCE AT ALL.

Republican states have expanded Medicaid, including Indiana in 2015, when former Vice President Mike Pence was governor. Missouri and Oklahoma both passed statewide ballot initiatives to expand in the summer of 2020. In Oklahoma, the measure narrowly passed with 50.5% of the vote, despite opposition from the state’s most prominent Republicans. A few months later, former President Trump carried Oklahoma with 65% of the vote, meaning there were pro-expansion, pro-Trump Republicans in Oklahoma.

Wisconsin is an island in the Midwest. The 11 other states that have not expanded Medicaid include South Dakota, Wyoming, and the Confederacy. Even Republicans in Wyoming’s Assembly passed expansion and they hold a 51-7 majority. I thought I had it bad in Wisconsin’s 60-38 GOP State Assembly, but even the much deeper red Wyoming Assembly gets it.

Despite the widespread popularity and success of expansion throughout the country, it appears legislative Republicans will again stand in the way. Immediately, they labeled the decision an expansion of welfare and some have vowed not to support it. Despite the rhetoric, federal action offers us a new opportunity to find compromise. The scale of state savings gives us a once in a generation opportunity to cover more people and put ourselves in a stronger fiscal position. The savings could be set-aside in an interest earning account, like an endowment, for future budgets. Or it could be used to pay down state debt to free cash in the future. Or it could be used to reduce taxes. Frankly, it could be used to do all three.

This is a win-win. Reducing the number of uninsured people helps everyone by reducing uncompensated care. Expanding BadgerCare will help close that gap and provide eligibility to working people living close to the federal poverty line. It saves the state an enormous amount of money that we are free to do what we please with.

All of these things are contained within one item in the state budget, making it the most important single item in our current budget debate.

Evan Goyke represents District 18 in the Wisconsin State Assembly.