MADISON, Wis. (AP) — The projected shortfall in Wisconsin's Medicaid programs serving the poor, elderly and disabled through plans like BadgerCare has improved by more than $300 million, Gov. Scott Walker's administration said in a letter released Tuesday.
Despite the good news, Department of Health Services Secretary Dennis Smith said in a letter to lawmakers dated Dec. 30 and made public Tuesday that the new estimate does not change plans to cut costs in various Medicaid programs that could result in about 65,000 poor adults and children losing coverage.
The cost-savings plan is awaiting approval by President Barack Obama's administration, and the news that the Medicaid shortfall isn't as bad as previously thought only increases pressure on Walker's administration to scale back the proposed reductions.
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"I once again call on Gov. Walker to slow down and sincerely work with all stakeholders in order to achieve necessary savings without seriously risking the health of our most vulnerable individuals," said state Rep. Sandy Pasch, D-Whitefish Bay.
That sentiment was echoed by Robert Kraig, executive director of Citizen Action Wisconsin, and Jon Peacock of the Wisconsin Center on Children and Families, both of whom advocate for Medicaid recipients.
"This new information clearly shows that there is no compelling reason to force anyone off BadgerCare," Kraig said.
A spokesman for Gov. Scott Walker declined to comment and referred questions to DHS.
Smith, the DHS secretary, urged caution in the letter to co-chairs of the Legislature's budget committee.
Medicaid's improved projected shortfall — from $554 million in September to $232 million now — represents a change of only 2 percent of all the state and federal money spent on the programs, Smith said in the letter.
About $7.5 billion is spent every year on Medicaid programs like BadgerCare, SeniorCare and Family Care, which benefit nearly 1.2 million poor, elderly and disabled Wisconsin residents.
Walker's administration cited growth in enrollments and spiraling costs as the motivation for its cost-savings plans, parts of which have already been approved by state lawmakers but portions of which still need federal approval.
Smith cautioned that even minor changes in enrollment or billing patterns can have a dramatic effect on Medicaid's bottom line given the size of the program, and that is why the department plans to proceed with its cost-savings plan.
Smith said in the letter that the numbers improved for a number of reasons, including lower-than-anticipated increases in people enrolling in the various programs, less costly Medicare Part B payments and an overall drop in costs per enrollee.
While the new numbers are good news, they do not mean that the cost-savings being proposed by DHS should be dropped, said Sen. Rob Cowles, R-Green Bay. However, if the savings as projected in the new forecast do pan out, that money could be used to help pay for a planned re-opening and expansion of the popular Family Care program as announced last week, Cowles said.
Family Care is designed to keep the disabled and elderly people out of costly nursing homes.
The enrollment cap, which Walker enacted in July, was scheduled to result in about $106 million in savings over two years. The cost of reopening the program, which the federal government ordered Walker to do, and expanding it to 15 counties will depend on when those changes are implemented, Smith said.
Lifting the cap and expanding the program need legislative approval and Rep. Robin Vos, one of the Republican co-chairs of the budget committee, expressed concerns about Walker's change in direction.
A spokeswoman for Vos and a spokesman for Sen. Alberta Darling, the other committee co-chair, did not immediately return messages seeking comment Tuesday.
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