As the calendar turned to 2012, many of Wisconsin’s working families began to feel the effects of state budget cuts and policy changes made in the biennial budget bill signed into law last July.  According to a new synopsis of delayed budget changes by WCCF, working families are beginning this month to be adversely affected by a number of changes, such as reduced tax credits, higher health care premiums and copays, and a new waiting period for unemployment insurance benefits.

“The range of changes that will make things tougher for Wisconsin families starting this year is startling,” said Ken Taylor, executive director of the Wisconsin Council on Children and Families. “At a time when so many working families are just starting to get back on their feet in the wake of the recession, it’s troubling to see just how many policy changes are going to make it more difficult for them to bounce back economically.” The WCCF summary includes changes that affect tax credits for low-income households; health care costs and benefits through BadgerCare; a new waiting period for collecting unemployment benefits; and more restrictive options for workers participating in the W-2 program. Some of the changes went into effect on January 1, while others will be felt by Wisconsin residents when they file their income tax returns over the next few months.

“Low- and moderate-income families in Wisconsin are going to feel some pain as the cumulative impact of these changes sinks in,” said WCCF Research Director Jon Peacock. “These families’ loss of buying power is also going to have a negative impact on the state’s economy.”

The most significant effects for working families will probably begin at least a few months into the year, if or when federal officials allow the Department of Health Services (DHS) to implement proposed changes to the BadgerCare program.

Those changes are estimated by DHS to reduce BadgerCare participation by more than 64,000 people, including over 29,000 children. An additional 263,000 people who remain in the program would have reduced benefits and significantly higher copays.

Jon Peacock