To: Governor Tony Evers Administration
From: Robert Kraig
RE: Brief Memo on COVID-19 Emergency Response Related to BadgerCare and Private Health Coverage
Date: March 21, 2020
On a Health Matters coalition call earlier this week, Jamie Kuhn, the Governor’s Outreach Director, requested from health advocates short bullet points on actionable policy proposals.
Citizen Action of Wisconsin put out a press release on important policy options on Friday, based on the information available to us at the time. As your administration is in much better position to have the latest information, and has the full expertice of state government to draw on, I am going to just distill our policy proposals, minus the public explanations and framing necessary for a news release.
The Governor is correct to strongly urge social distancing to slow down and contain the spread of COVID-19. Given the testing failure, however, many are already infected and the disease is in its incubation period, silently infecting many friends, coworkers, and family members. Some with symptoms are not seeking treatment due to fear of crippling health care costs. It is vital public safety to remove all cost barriers to testing and treatment. Statewide opinion research we released last week with the help of the Health Value Hub and Robert Wood Johnson Foundation shows that the fear of unaffordable costs deterred almost half of Wisconsinites from seeking needed medical care and treatment in the last year. Given the testing backlog this means making it clear through immediate policy change that both testing and treatment will be cost free with no out of pocket costs. When testing is available more widely, national and international experts think we will need to move to community-wide testing. This will also require a guarantee of no cost sharing for testing or treatment to induce younger and healthier people to seek testing even if they feel well.
Citizen Action’s policies we propose are:
- Wisconsin has the authority to propose emergency waivers to the federal government, which can be approved within days of submission by CMS under federal emergency rules. A number of states have already proposed waivers and received approval. These waivers, if used to the full extent of the precedent set in previous national emergencies, can make it much easier to enroll in BadgerCare and to retain it, including online and phone enrollment, extension of renewal deadlines, suspension of cancellations, and elimination of barriers such as premiums, copays, work requirements, and many other administrative hurdles and barriers. Critically, Wisconsin could adopt a “presumptive eligibility” policy that allows medical providers, community health centers, and others to enroll people in BadgerCare without any income test if they appear eligible. This is especially helpful in an environment where there are mass layoffs and it would be time consuming to confirm that a family was eligible when unemployment insurance claims are likely to overwhelm the state’s processing capacity. The Coronavirus Relief Act which passed Congress this week increases the federal share of Medicaid costs in Wisconsin to 65.5%, offsetting part of the state cost for expanding BadgerCare enrollment.
- The massive level of cost sharing in most private health insurance plans also deters people from seeking COVID-19 testing and treatment, endangering public health. A number of states already mandated that health insurance plans cover COVID-19 testing and treatment with no consumer cost sharing. So far, OCI has only recommended that insurers suspend copays and deductibles. It would be prudent for Wisconsin to actually ban cost sharing as a danger to public health, as according to Kaiser 3 states have done (as of Friday) for all testing and treatment and any future vaccine, and 10 states have done for all testing and a future vaccine. If this creates too much of a burden on health insurance and self-insured plans, Wisconsin could also outlaw hospital price gouging by requiring them to accept Medicare rates (or some percentage such as 150% of those rates) for all treatment for any condition that results from a COVID-19 test. There is no justification for hospitals and medical providers to charge unreasonable prices for their services during this state and national emergency. Most independent Health care experts believe that negotiated private insurance rates in the U.S. are the most expensive in the world, and are not justified.
- Wisconsin should immediately expand BadgerCare by accepting the Medicaid Expansion authorized and funded by the Affordable Care Act (ACA). Without ACA Medicaid Expansion, “presumptive eligibility” will not work for many adults who do not fit into specific Medicaid eligible categories and are (or appear to be) above the federal poverty line. In addition, as Wisconsin is losing $340 million in the current state budget because it turned down the ACA Medicaid expansion funding, this revenue could immediately be deployed in the fight to contain COVID-19. Accepting Medicaid Expansion would allow Wisconsin to use presumptive eligibility to get the state close to universal health coverage and to reassure the public that cost should not deter them from seeking COVID-19 testing and treatment. It would also defray some and perhaps all of the state’s costs for increased enrollment resulting from all of the emergency measures we propose.
- Wisconsin should follow the State of Washington in seeking a waiver to expand Medicaid eligibility well above the ACA Medicaid expansion level of 138% of Federal Poverty Level. Citizen Action urges you to consider this for all of the reasons stated above, especially the effective use of presumptive eligibility to cover as many Wisconsinites as possible. Private insurance, unless you can effectively ban all cost sharing, cancellations and renewal requirements, is inappropriate for people who have little or no financial margin. Also it will be much harder to enroll people in private insurance than a streamlined BadgerCare enrollment process, and the Trump Administration has not as of yet even created a new special enrollment period for ACA marketplace plans for COVID-19. There is nothing magical about 100% or 138% of FPL, and they are not based in any way on the actual ability to manage and pay for private health insurance and medical cost sharing.