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MADISON — The U.S. Supreme Court ruling on federal health reform could lead Wisconsin to try again to make Medicaid cuts expected to cause 64,000 people, including 29,000 children, to lose state coverage.

Meanwhile, the state hasn’t decided whether to pursue the health reform law’s Medicaid expansion, which the court decision in June made optional.

But a top official said the expansion would be costly.

Dennis Smith, secretary of the state Department of Health Services, also said he welcomes Republican vice presidential candidate Paul Ryan’s proposal to give states block grants for Medicaid, the state-federal health plan for the poor.

“The more efficient we become, we would keep those savings,” Smith said of block grants, or lump sums. “That is a huge incentive for the state.”

While the Supreme Court ruling clarified the federal government’s ability to require most Americans to buy health insurance, it left some aspects of Medicaid coverage up for debate or in the hands of states — with possible legal battles to come.

Smith said the part of the ruling that made the Medicaid expansion optional also struck down a requirement to maintain Medicaid eligibility levels.

Kathleen Sebelius, secretary of the federal Department of Health and Human Services, said in a letter to governors last month “the court’s decision did not affect other provisions of the law.”

But Smith said the ruling means Wisconsin could resubmit a proposal to make changes estimated to cause 64,000 people, including 29,000 children, to lose Medicaid coverage.

He has no plans to do so, but it’s an option, he said.

The federal government likely would have to agree to the proposal now because of the court ruling, Smith said.

In April, federal officials approved lesser changes expected to cause 17,000 adults, and no children, to lose coverage.

Nearly 1.2 million people, or one in five state residents, get some kind of Medicaid coverage, including 771,000 on BadgerCare Plus. Maine is making changes to its eligibility levels, which could bring the issue before the courts, according to observers such as Jon Peacock, research director of the Wisconsin Council on Children and Families.

“I think the courts will disagree with Smith’s interpretation” and what Maine is doing, Peacock said.

Medicaid expansion?

Smith and Gov. Scott Walker say they won’t decide whether to pursue the health law’s optional Medicaid expansion or set up a required insurance exchange until after the November elections.

But expanding Medicaid coverage to the 170,000 or so people in question, most of them childless adults, would be expensive, Smith said.

The federal government initially would pick up the entire tab, but the state eventually would have to pay some of it, Smith said. Adding enrollees would drive up the pressure to pay providers more, he said, and the state will already struggle to cover people now eligible for Medicaid who likely will sign up once the health law fully starts in 2014.

“Until we get the current program sustainable, it’s hard to think about expanding,” he said.

But forgoing the Medicaid expansion would leave many of those 170,000 people uninsured and unable to pay their medical bills, forcing hospitals and clinics to shift the costs to people with private insurance, said Bobby Peterson, executive director of ABC for Health, a nonprofit law firm in Madison that helps people find health care.

“Hospitals will have to absorb more uncompensated care, which generates higher costs,” he said. “There’s more cost pressure either way.”

Medicaid block grants

Block grants would let states save money by running Medicaid more efficiently, Smith said. The idea has been around a long time, but the selection of Ryan, a Congressman from Janesville, as Mitt Romney’s running mate is bringing new attention to it.

A Ryan budget proposal calls for block grants and reducing federal spending on Medicaid by about $800 billion over 10 years.

Smith said block grants would free states from some cumbersome federal requirements and encourage innovation, such as paying nursing homes differently if they wanted to transition to lower-cost, home-based care.

Patients now on Medicaid would retain coverage, Smith said. “I can do this without changing current eligibility,” he said.

That may be technically true, Peacock said, but the state likely would impose more co-payments, higher premiums and other changes making coverage unaffordable for many.

Block grants “are a way for Washington lawmakers to steadily shrink spending for Medicaid,” Peacock said.

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(8) comments

ML_EngAmer

Not only are these Governors holding a suffering lower to lower-middle class hostage for partisan purposes, but they are doing it in spite of how it will affect their states' economies. With the ACA designed to insure the uninsured, there will be a major cut in federal aid going to hospitals to subsidize unpaid patients. By denying the expansion, these politicians will force hospitals and clinics to downsize and shut-down.

This means layoffs and less access to emergency care throughout the state. Beyond that, preventing those in need from gaining coverage leaves them less able to participate in the economy which directly affects that state and cumulatively affects the national economy.

ML_EngAmer

From a fiscal and functional standpoint, this repercussions of hospitals losing funding would have a significant impact on a given state. This lead to a rise in unemployment, further increases in local medical costs and severely overburdened and underfunded remaining hospitals.

At the end of the day, the people not receiving service locally will have to go somewhere and those locations will end up losing money that will also go uncompensated. It will become a compounding problem that will harm the standard of living in many ways.

On the other side of things, the ACA carries certain liabilities as a result of our current 4000+ page tax code. Essentially, the $200k-$250K (married) income threshold considers all small-business income as personal income for the owner(s). Realistically, those owners are only paying themselves a portion of that income. As a result, the individual's and business's finances are subject to improper taxation which limits the business from expansion (hiring) by limiting saving funds for expansion and other operational needs.

We need complete tax reform. The Bowles-Simpson plan is the best that has been offered as an achievable and balanced tax and budget reform that doesn't hurt the public or play favorites.

wakeup

Smith was hand picked from out of state because of his anti-Medicaid work with the rightie Heritage Foundation. Surprise, surprise - he wants to get rid of it now in Wisconsin (block grants to Republicans is just another pot of public money to dole out to cronies). This is what happens when you have a health care czar (and truly, this title is apt) who cares more about following his petty narrow ideologies than the health of the citizens of the state. Everyone reading or writing here should remember they are only one car accident, food contamination, brain injury or sudden medical condition away from being bankrupted by medical bills (more than 50% of bankruptcy comes from medical bills). What we really need is a single payer system that provides basic health care for everyone. We're going to get just the opposite from Smith and Walker.

Seriously Now

Nasty says, "I do not want to be lumped into the folks that ...can't find work, or have life long disabilities not related to working. They should be treated differently than what I will be when the time comes" And says, "I hate to sound cold, hard, and crass." Basically, let 'em die in the gutter, cuz you got yours, right?" So a steel mill worker who can'ty find work because the mill shut down should be treated differently? How about the folks at the paper mills in Wisconsin Rapids? They should be treated differently? Try this: stop spending money on useless wars, fund universal coverage and reap the benefits of less emergency room costs. Then demand to negociate prices with big pharma, as the Canadians do, cutting drug prices by 45 percent. For God sake, THINK man, THINK.

snowman2795

The looming 'crisis' outlined in this piece, is just another Gov. Scott Walker, ploy to reduce the size of government spending on services to the poor and sick at a time of record corporate profits.

Walker is refusing to do anything even though Medicaid will see 100% funding from the Feds under the Affordable Care Act for three full years. Currently, the state picks up 45%. This is a no-brainer.

If the state begs off its responsibility to fund Medicaid for our most vulnerable neighbors under its current 'no tax increases' mantra at a time when taxes are at their lowest point in 50 years as a percentage of GDP, it must consider broadening the tax base.

A good place to start would be taxing religious properties and institutions. The same who have ignored James 5, and have thrown their support behind Mr. Walker and his Koch brother think-alike ideologue associates to the detriment of the poor.

Another place to start would be in Washington, by repealing Free Trade that has carved out our manufacturing base, destroying millions of good jobs in this country at the altar of higher corporate profits for those who have out-sourced jobs through economic treason.

There are solutions that do not require leaving 65 thousand people without coverage hiding under the cover of a made-up crisis contrived by our son of a pastor Governor.

Nastysmell

I hate to sound cold, hard, and crass, but I have been working all my life and paying into this lousy system. I do not want to be lumped into the folks that either won't work or can't find work, or have life long disabilities not related to working. They should be treated differently than what I will be when the time comes (63 now). The lousy medical system in the US penalizes us by charging extremely high fees for services to cover people that do not pay. If you want to cover these people, fund it differently so the hospitals do not overcharge us. The big money makers in the drug, corporate hospital bosses, and insurance businesses need to be carefully examined for illegal actions and how much they earn. I do not have a problem with what medical professionals get paid, just the horrible inefficiencies of the system. And the worst part is the people that bring lawsuits against medical professionals the most are people in the latter catagory (do not pay). Oh yes, one more item, lawyers should be paid by the hour, not by a percentage of what they win, this is a blatant conflict of interest on the part of lawers. But who can bring a lawsuit against a lawyer??

gerardtedesco


We still need to feed our family healthy, well-balanced meals while keeping to a set budget. Change is the hardest thing and trying to do everything at once will have most people quitting before they even begin. You can get samples from sites like "Official Samples" where you can find all samples

Anonangel

Good incentive for the state???? I hope they can sleep at night. If this goes through people should send the people who pass this bill pictures of the children that die because of this.

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