Wisconsin’s success in improving access to health care for children through the BadgerCare program has qualified the state for a federal bonus of $24.5 million for 2011, federal officials announced this afternoon.

“Today’s announcement is fantastic news for families in BadgerCare because these funds could be used to avoid making proposed changes that would knock more than 64,000 people out of the program,” said Ken Taylor, WCCF’s executive director.

This blog post examines the background of the bonus awards, the total amount granted today, and the anticipated reduction in future awards if the Department of Health Services is allowed to proceed with plans that sharply reduce enrollment of children in BadgerCare.Wisconsin is one of 23 states receiving performance bonus funding in 2011 for progress in removing red tape and administrative hurdles to enroll significantly more uninsured children in their Medicaid programs. A total of nearly $300 million was awarded to states by the federal Centers for Medicare and Medicaid Services, and Wisconsin’s $24,541.778 bonus payment is the fourth largest.

The performance bonus fund was established by Congress in 2009 to encourage states to do a better job of enrolling lower income children who were already eligible for Medicaid. To be eligible, a state must meet targeted increases in Medicaid enrollment, relative to the 2007 level, as well as meet certain policy standards for improving enrollment and renewal processes. The bonus payments will continue through 2013, with qualification based on the amount by which a state exceeds the minimum growth target, relative to the 2007 base level.

A memo by the Legislative Fiscal Bureau prepared for Rep. Cory Mason examines the question of what would happen to the anticipated bonus award in 2012 if the state proceeds with plans to implement policy changes proposed by the Department of Health Services that are expected to reduce the number of children in BadgerCare by more than 29,000. The Fiscal Bureau concluded that such changes would reduce the bonus award by an estimated $10.3 million per year, starting in the second half of 2012.

Wisconsin’s eligibility for the bonus award results partially from BadgerCare policy changes implemented in 2008, and a small change initiated in April 2010. Those policy changes include allowing families to complete one application form for both the Medicaid and CHIP programs, eliminating the in-person application requirement, streamlining the benefit renewal process, and eliminating the requirement that a family’s assets fall below a certain level for children to receive health care. 

However, the size of the award is a function of the enrollment growth from January 2008 through June 2011, which resulted from numerous changes in the design of BadgerCare Plus, including the removal of premiums for kids below 200% of the poverty level.  A number of those improvements would be undone if DHS gets federal approval for the Maintenance of Effort waiver that would allow the department to make sweeping changes to the program.

For further reaction to today’s announcement of the bonus awards, see WCCF’s press release and the Save BadgerCare Coalition release.

Sara Eskrich and Jon Peacock