Thursday, September 5, 2013

Evaluation of Last Year’s BadgerCare Changes Makes Strong Case against New Waiver

CMS Is Accepting Public Comments until September 22 on Waiver Proposal

A preliminary evaluation of changes to BadgerCare implemented in July 2012 shows that extending premiums to low-income families causes a dramatic decline in their participation in the program. Those results have important implications for the waiver recently submitted by the Department of Health Services (DHS) to make changes next year in BadgerCare and Transitional Medical Assistance (TMA).

The Centers for Medicare and Medicaid Services (CMS) is now accepting public comments on the proposed waiver.  Comments can be submitted online until September 22nd.

Since July 2012, Wisconsin has been conducting a test of the effects of requiring more adults in BadgerCare to pay premiums and of increasing the premiums for other adults. A new 3-page WCCF report analyzes and summarizes some of the key results, based on data in the preliminary DHS evaluation. Our report also examines the implications of those finding for the portion of the proposed waiver that would require premiums from all parents above the federal poverty level who are participating in TMA.

Based on those preliminary results, it is clear that requiring premiums has very damaging effects for low-income adults. We took a close look at the DHS data for the 18,544 parents and caretakers on BadgerCare or TMA who in July 2012 had incomes between 133% and 150% of the poverty level. The DHS data show the following effects over the first six months of implementation:
  • Only 31% of the adult BadgerCare and TMA adults who were in that income range in July 2012 were still enrolled and in a premium-paying category six months later.
  • Failure to pay a premium caused 21% of the original 18,544 to lose their coverage within six months.
  • Slightly over two-fifths of relevant enrollees lost coverage due to premium payments: Among the initial group of about 18,500 BadgerCare and TMA participants who were required to pay premiums, almost half either lost coverage for some other reason (such as an offer of employer-sponsored insurance) or moved below the premium-paying threshold. Of the remaining premium-paying enrollees, 41% lost their coverage due to non-payment of a premium.
TMA is a category of Medicaid that grew out of welfare reform and extends eligibility by 12 months for parents who are lifted above the poverty level by a new job or a raise. It is intended to help families that are just moving into the work force by giving them a transition period before they have to begin paying premiums. Although the rest of the waiver proposed by DHS appears to be consistent with federal law, the portion requiring all parents in TMA to pay premiums conflicts with federal statutes and rules.

When experiments are conducted on human subjects, the common practice is to halt the evaluation if preliminary results show that people are being harmed. In light of that common sense practice and the alarming results demonstrated in the first six months of this experiment, we think it’s clear that the federal statutes relating to Transitional Medicaid should not be waived.

Jon Peacock

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