Gov. Walker’s decision to remove 62,776 people from Wisconsin’s Medicaid program who earned more than 100 percent of the federal poverty level (FPL) made them eligible for highly subsidized private coverage in the health insurance exchange.
According to Linda Gorman, a state health care policy expert at the Colorado-based Independence Institute, “The major differences for the people who are eligible for federally subsidized coverage is that they are immediately eligible for premium subsidies and are no longer subject to the waiting lists created by Wisconsin’s BadgerCare Plus enrollment caps.”
Although Medicaid is free, the most a low-income individual in the exchange will have to pay is 2 to 3 percent of income toward a private health plan with premiums running into the thousands of dollars, depending on age. In many cases, premiums would be far less, even $0, depending on the plan selected.
For example, a 43 year old in Milwaukee earning $17,000 would have four different bronze-level plans available at no cost after subsidies, and two more with monthly premiums of $5 or less.
Another advantage to expanding private coverage is that private plans tend to pay provider fees much higher than what Medicaid pays. Gorman notes doctors are generally more willing to treat privately insured patients than Medicaid enrollees, which means better access to care.
The people who remain on or gained Medicaid coverage through Walker’s expansion also may get better access to care as so many former recipients move to private coverage. Gorman notes access for Wisconsin’s current BadgerCare enrollees would likely get much worse if those now eligible for exchange-based coverage remained in Medicaid while more people were added to the rolls and the new Medicaid patients flooded doctors with requests for appointments.