Republicans, touting conservative study, warn against Medicaid expansion

Feb. 20--Less than two weeks from the rollout of Gov. Tony Evers' budget, Republican lawmakers are touting a health care study to strengthen their case against Medicaid expansion.

The report drew swift criticism from Democrats, who questioned its legitimacy and characterized it as an attempt to block implementation of their plan to expand Medicaid eligibility through the state's BadgerCare Plus program to about 76,000 Wisconsinites.

The study, by the conservative Wisconsin Institute for Law and Liberty and UW-Madison economics professor Noah Williams, found expanding Medicaid in 2020 would increase private insurance consumer costs by $1.145 billion while saving state taxpayers $545 million, for a net cost to the state of about $600 million a year.

The conclusions drew sharp criticism from Donna Friedsam, health policy programs director of UW-Madison's Population Health Institute.

"This study has several methodological and analytical flaws that substantially compromise the validity of its conclusions," Friedsam said.

Friedsam in an email said the study omits evidence of better health outcomes associated with previous BadgerCare expansions, and pointed to mathematical errors and problems with the study's conclusion that health care spending is higher in Medicaid expansion states.

She added most economists reject the reasoning that private sector health care costs would increase because health care providers would pass on costs from low Medicaid reimbursement rates to consumers.

Wisconsin is one of more than a dozen states that haven't taken federal funding to expand Medicaid to people who make up to 133 percent of the poverty level, a move that would have saved the state $1.1 billion from 2014 through 2019, according to the Legislative Fiscal Bureau.

A September LFB report showed taking full Medicaid expansion beginning in 2020 would give the state an additional $280 million to work with over the next two-year budget cycle. Friedsam estimates that, of the 76,000 who would become eligible for Medicaid under the expansion, about 39,000 would come from the uninsured while 37,000 would come from existing Obamacare subsidized coverage.

Wisconsin is the only non-expansion state that has no gap in coverage for residents below the poverty level. Former Gov. Scott Walker and the Legislature limited coverage to people at the poverty line, not below it as some other states do, saying people who make more can get subsidies on the Affordable Care Act marketplace.

Evers is likely to include federal money for Medicaid expansion in his biennial budget request to be unveiled Feb. 28.

But Republicans at a news conference on the WILL study Tuesday said it's all but guaranteed they will oppose Evers' plan.

"I think all of us have made it very clear that we do not and will not support Medicaid expansion," said Sen. Chris Kapenga, R-Delafield. He was joined by Sens. Duey Stroebel, R-Saukville, David Craig, R-Big Bend, and Rep. Joe Sanfelippo, R-New Berlin.

The study acknowledged some of the "obvious" benefits of Medicaid expansion, such as expanding health care coverage for individuals currently unable to afford coverage and increasing use of preventive care.

But it also found higher health care costs in states that took Medicaid expansion under the Affordable Care Act compared with those that didn't. After controlling for variables such as age, income, poverty, urban concentration and total population, the study found an increase in private sector health care costs of $177 per person and a rise in emergency room visits by about 9 per 1,000 residents.

"The strings that come with federal money often make it not worth it, and here we've got a very credible analysis that really points that out," Stroebel said.

Friedsam, however, said it's unlikely Wisconsin would experience the same increase in emergency room visits as other states.

Assembly Speaker Robin Vos, R-Rochester, who has long been opposed to Medicaid expansion, said in a statement the WILL study confirms Wisconsin "found the right balance" by choosing to not fully implement Medicaid expansion.

Democrats ripped the study's authors and argued there is "overwhelming" public support for Medicaid expansion.

"It's not hard to see the bias in this report put together by a wannabe staff for Gov. Walker's failed presidential campaign and a corporate-funded Republican think tank," Senate Minority Leader Jennifer Shilling, D-La Crosse, said in a statement. "The same powerful corporations, pharmaceutical companies and insurance executives who want to limit health care access and reap record profits continue to be the most vocal opponents of the Affordable Care Act and Wisconsin's Medicaid expansion."

Liberal advocacy group One Wisconsin Now revealed Williams offered to advise former Gov. Scott Walker's presidential campaign. Williams is also the founding director of the Center for Research on the Wisconsin Economy, which has received funding from the conservative Charles Koch Foundation and Milwaukee-based Lynde and Harry Bradley Foundation.

The most recent Marquette University Law School poll in January showed 62 percent of Wisconsinites support accepting federal funds to expand Medicaid.

Robert Kraig, executive director of the liberal advocacy group Citizen Action of Wisconsin, questioned the WILL report's validity and pointed to other recent studies that have documented that private health insurance premiums are lower in states that took Medicaid expansion.

One such study found private insurance premiums in Medicaid expansion states are 11 percent lower than those in non-expansion states based on a statistical comparison of bordering counties. The study by two professors at John Hopkins Bloomberg School of Public Health and Georgetown University was published in "Health Economics" in July 2018.

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