Kaiser Commission Report Shows WI Is Using ACA Options to Improve Medicaid

A policy brief released last week by the Kaiser Commission on Medicaid and the Uninsured contains some rather surprising news about Wisconsin and the Affordable Care Act (ACA). The brief summarizes five ways in which states are currently taking advantage of ACA provisions to improve Medicaid – and Wisconsin has taken a step forward in four of the five categories.

When examining each of the provisions separately, it doesn’t seem like a big deal that Wisconsin is taking advantage of the incentives (even for an ACA-obsessed person like me). However, seeing the cumulative extent to which the ACA is improving our state Medicaid program is pretty exciting (hopefully not just for me, but for you too). And it’s surprising when you consider the Walker Administration’s public stance, which has been extremely critical of the ACA.

It has been frustrating for many health care advocates that Wisconsin officials have been so hostile to the highest profile portions of the ACA, such as implementation of health insurance Exchanges. However, the Kaiser Commission report shows that our state has quietly been taking advantage of uncontroversial – yet very important – provisions to strengthen and innovate in BadgerCare and Medicaid:1. New federal Medicaid funding for disease prevention. Wisconsin received nearly $3 million in a five year grant to test the effectiveness of providing financial and non-financial incentives to Medicaid beneficiaries who participate in prevention programs and demonstrate changes in health risk and outcomes in the area of tobacco cessation.

2. Health homes for individuals with chronic conditions. The federal government has authorized Wisconsin to spend up to $500,000 in Medicaid funding for planning related to development of a health home initiative (through a state plan amendment). This initiative is aimed at better coordinating health care for individuals with at least two chronic conditions, by improving quality, outcomes, and the patient experience, while reducing costs. If approved, Wisconsin’s developing plan would be eligible for 90% temporary federal match funding.

3. Integrating financing and care for dual eligible beneficiaries. Dual eligibles are individuals enrolled in both Medicare and Medicaid. They account for a disproportionate share of spending in both programs, which is why there is such a concerted effort at both the state and federal level to reduce costs through new service delivery and payment models. Wisconsin was awarded $1 million to help design this demonstration project – and the proposal has now been submitted to the federal government for approval.

4. Increased federal funding to upgrade Medicaid eligibility systems. Wisconsin has submitted an advanced planning document to take advantage of the increased federal “90/10 rule,” or 90% federal match funding for the design, development, and implementation of major upgrades or new eligibility systems in Medicaid. This will help state Medicaid programs to be better prepared to harness paperless, real-time eligibility determinations in coordination with Exchanges and to remedy some of the current deficiencies in the state’s computer systems. Though WI Department of Health Services (DHS) Secretary Smith has said that he will not use the 90/10 money to prepare for Exchanges (see our blog from January on that decision), when I asked about this issue at a recent public meeting the Secretary responded that Wisconsin will use 90/10 money to enhance our Medicaid eligibility systems. Despite the mixed messages, we were heartened to hear that Wisconsin has submitted advanced planning documents because it would be foolish to miss the opportunity to use the enhanced federal funding for system upgrades that are badly needed in our state.

5. Getting an early start on the Medicaid expansion. Among the five Medicaid options Kaiser examined, this is the one that Wisconsin is not directly taking advantage of – because our state already initiated the BadgerCare Core program to extend coverage to childless adults up to 200% of the federal poverty level. That was done before the ACA was passed; however, the state later put a freeze on enrollment in the program, and participation is plunging as current enrollees drop out for one reason or and cannot get back in. (To read more about the freeze on Core, check out the recent special edition of HealthWatch Wisconsin’s reporter and the WI Budgt Project’s April 25th blog post. Relief will come for childless adults in Wisconsin in 2014, when the ACA makes sure that all states provide Medicaid coverage (with a much higher federal match rate) for adults up to 138% of the federal poverty level, and Exchange subsidies for families up to 400% of the poverty level.

An additional provision of the ACA making a huge difference in the Wisconsin Medicaid program is the maintenance of effort provision (MOE). As we’ve discussed in previous posts, without the MOE stability provisions, 29,000 children would have lost their BadgerCare coverage under the Walker Administration’s Medicaid reform proposals released last fall, and about twice as many adults would be losing coverage. (See our May 3 summary of the original DHS proposal and the approved changes.)

Overall, health reform is helping to maintain and improve the quality of BadgerCare and Medicaid in Wisconsin, allowing us to continue innovating with enhanced federal funding. This is great news.

Sara Eskrich