A Vision for Effective Implementation of the Affordable Care Act in

For Immediate Release
Media Contact: Mike Bare (920.242.1639; [email protected])
Date: July 20, 2015
A Vision for Effective Implementation
of the Affordable Care Act in Wisconsin
Milwaukee—Today, the Community Advocates Public Policy Institute (PPI) released its “Vision for Effective
Implementation of the Affordable Care Act in Wisconsin.”
President Obama signed the Patient Protection and Affordable Care Act (ACA) into law in 2010. The ACA’s
primary goals were to 1) expand health coverage, 2) reduce health costs while increasing health care quality,
and 3) protect consumers from insurance company abuses.
The report advocates for establishing a state-based marketplace that is focused on expanding coverage while
lowering cost and improving quality, expanding and improving BadgerCare coverage, establishing innovative
health delivery models, expanding health benefits, further protecting consumers, and improving enrollment
assistance.
Mike Bare, Research and Program Coordinator at the Community Advocates Public Policy Institute and
coordinator of PPI’s Effective ACA Implementation Project (Bio
http://communityadvocates.net/ppi/who_we_are/#Mike), said, “The courts have repeatedly upheld the ACA as
the law of the land. It’s long past time for Wisconsin to take full advantage of the tools that the ACA offers
states. Our vision is a roadmap for policymakers to fully and effectively implement the ACA in a way that
would decrease the number of uninsured Wisconsinites while saving state taxpayers hundreds of millions of
dollars. It would also further expand benefits, and protect consumers.”
David Riemer, Senior Fellow at the Community Advocates Public Policy Institute
(http://communityadvocates.net/ppi/who_we_are/#David), said, “Wisconsin once had a proud tradition of
forging bipartisan consensus to tackle some of the state's biggest challenges. W-2 and BadgerCare are prime
examples of such bipartisan agreement. State leaders need to return to that tradition in implementing the ACA,
so that Wisconsin can sharply reduce the size of its uninsured population and create exchanges that work
effectively to drive down health care costs and enhance quality.”
Since 2010, the Community Advocates Public Policy Institute has been a leading advocate for full
implementation of the ACA in Wisconsin. In 2012, PPI submitted three amicus briefs (friends of the court
filings) to the Supreme Court in support of the ACA, and was the only Wisconsin-based advocacy organization
to participate in the case.
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!
A"Vision"for"Effective"Implementation"of"the"
Affordable"Care"Act"in"Wisconsin"
Introduction"
By!Mike!Bare!and!David!Riemer!
"
!
President!Obama!signed!the!Patient!Protection!and!Affordable!Care!Act!(ACA)!into!law!on!March!
23,!2010,!and!the!Health!Care!and!Education!Reconciliation!Act!of!2010!into!law!on!March!30,!2010."
"
The!ACA’s!primary!goals!were!to!1)!expand!health!coverage,!2)!reduce!health!costs!while!
increasing!health!care!quality,!and!3)!protect!consumers!from!insurance!company!abuses.!!
!
Expand"Health"Coverage"
• In!Wisconsin,!183,155!consumers!obtained!coverage!in!quality,!affordable!health!insurance!coverage!
through!the!Marketplace!as!of!March!31,!2015.!Of!those,!90.7%!did!so!with!financial!assistance.!
Nationwide,!10.2!million!consumers!obtained!Marketplace!coverage.1!
• “Nationwide,!since!the!Affordable!Care!Act’s!coverage!expansion!began,!about!16.4!million!uninsured!
people!have!gained!health!insurance!coverage![!the!largest!reduction!in!the!uninsured!in!four!
decades.!And!Gallup!recently!announced!that!the!uninsured!rate!in!Wisconsin!in!2014!was!8.4!
percent,!down!from!11.7!percent!in!2013.”2!
!
Reduce"Costs"While"Increasing"Quality"
• “In!every!State!and!for!the!first!time!under!Federal!law,!insurance!companies!are!required!to!publicly!
justify!their!actions!if!they!want!to!raise!rates!by!10!percent!or!more.!Wisconsin!has!received!
$4,958,844!under!the!new!law!to!help!fight!unreasonable!premium!increases.”3!
• “Health!insurance!companies!now!have!to!spend!at!least!80!cents!of!your!premium!dollar!on!health!
care!or!improvements!to!care,!rather!than!administrative!costs!like!salaries!or!marketing,!or!they!
have!to!provide!you!a!refund.!This!means!that!69,396!Wisconsinites!with!private!insurance!
coverage!benefited!from!$2,584,967!in!refunds!from!insurance!companies,!for!an!average!refund!of!
$52!per!family!because!of!the!Affordable!Care!Act.”!
• “Because!of!the!Affordable!Care!Act,!76!million!Americans!with!private!health!insurance!gained!
preventive!service!coverage!with!no!cost[sharing,!including!1,539,000!in!Wisconsin.!And!women!
can!now!get!coverage!without!cost[sharing!of!even!more!preventive!services!they!need.!Of!the!76!
million!Americans!with!expanded!access!to!free!preventive!services,!29.7!million!are!women,!
including!587,000!in!Wisconsin!receiving!expanded!preventive!services!without!cost[sharing.”!
• “The!health!care!law!expands!mental!health!and!substance!use!disorder!benefits!and!federal!parity!
protections!for!62!million!Americans!nationwide,!including!1,017,692!Wisconsinites.”4!
• Through!Fiscal!Year!2013,!Wisconsin!has!received!$34,210,714!in!grants!from!the!Prevention!and!
Public!Health!Fund!created!by!the!health!care!law.!This!fund!was!created!to!support!effective!
policies!in!Wisconsin!and!nationwide,!such!as!initiatives!focused!on!tobacco!cessation,!obesity!
prevention,!health!coverage!enrollment!assistance!and!increasing!the!primary!care!and!public!
health!workforce,!so!that!all!Americans!can!lead!longer,!more!productive!lives.!!
• In!Wisconsin,!people!with!Medicare!have!saved!nearly!$260,821,882!on!prescription!drugs!because!
!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!
!http://www.cms.gov/Newsroom/MediaReleaseDatabase/Fact[sheets/2015[Fact[sheets[items/2015[06[02.html!!
!http://www.hhs.gov/healthcare/facts/bystate/wi.html!!
3!Id.!2!!
4!Id.!2!
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A!Vision!for!Effective!Implementation!of!the!Affordable!Care!Act!in!Wisconsin!
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of!the!Affordable!Care!Act.!In!2014!alone,!89,404!individuals!in!Wisconsin!saved!over!$81,650,077,!
or!an!average!of!$913!per!beneficiary.!In!2015,!people!with!Medicare!in!the!“donut!hole”!received!a!
55!percent!discount!on!covered!brand!name!drugs!and!a!35!percent!discount!on!generic!drugs.!And!
thanks!to!the!health!care!law,!coverage!for!both!brand!name!and!generic!drugs!will!continue!to!
increase!over!time!until!the!coverage!gap!is!closed.!!
• With!no!deductibles!or!co[pays,!cost!is!no!longer!a!barrier!for!seniors!and!people!with!disabilities!
who!want!to!stay!healthy!by!detecting!and!treating!health!problems!early.!In!Wisconsin,!744,549!
individuals!with!Medicare!used!one!or!more!free!preventive!service!in!2014.”5!
"
Protect"Consumers"
• “As!many!as!2,489,279!non[elderly!Wisconsinites!have!some!type!of!pre[existing!health!condition,!
including!309,519!children.!Today,!health!insurers!can!no!longer!deny!coverage!to!anyone!because!
of!a!pre[existing!condition,!like!asthma!or!diabetes,!under!the!health!care!law.!And!they!can!no!
longer!charge!women!more!because!of!their!gender.”6!
• “The!law!bans!insurance!companies!from!imposing!lifetime!dollar!limits!on!health!benefits!–!freeing!
cancer!patients!and!individuals!suffering!from!other!chronic!diseases!from!having!to!worry!about!
going!without!treatment!because!of!their!lifetime!limits.!Already,!2,142,000!people!in!Wisconsin,!
including!791,000!women!and!580,000!children,!are!free!from!worrying!about!lifetime!limits!on!
coverage.!The!law!also!restricts!the!use!of!annual!limits!and!bans!them!completely!starting!in!
2014.”7!
!
!
While!some!of!the!ACA’s!goals!have!been!achieved,!more!can!certainly!be!done.!Over!8%!of!
Wisconsinites!are!still!uninsured.!Health!costs,!while!rising!at!a!slower!pace!than!before!passage!of!the!
ACA,!are!growing!faster!than!household!incomes.8!Since!2010,!the!Community!Advocates!Public!Policy!
Institute!has!been!a!leading!advocate!for!fully!embracing!the!ACA!in!Wisconsin.!This!document!presents!a!
summary!of!Wisconsin’s!actions!to!implement!the!ACA!and!recommends!a!vision!for!full!ACA!
implementation.!There!are!a!number!of!policies!the!state!could!adopt!to!1)!increase!coverage,!and!
competition!and!transparency!in!the!marketplace;!2)!cover!more!low[income!Wisconsinites!with!
BadgerCare!while!saving!state!tax!dollars;!3)!create!innovative!health!delivery!models;!4)!expand!and!
improve!the!benefits!provided!by!certain!health!plans;!5)!better!protect!consumers;!and!6)!improve!
enrollment!assistance.!
!
Table"of"Contents"
"
"
1.
2.
3.
4.
5.
6.
7.
Marketplace"
BadgerCare"
Health"Care"Delivery"Models"
Benefits"
Consumer"Protection"
Enrollment"Assistance"
Conclusion"
!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!
!Id.!2!
!Id.!2!
7!Id.!2!
8!http://www.commonwealthfund.org/publications/issue[briefs/2014/Dec/National[Trends[Employer[Coverage!!
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1. Marketplace"
!
ACA"Today"
!
The!ACA!established!marketplaces!in!which!competition!among!health!insurers!is!managed!by!the!
government!to!help!achieve!the!goal!of!covering!more!people!while!reducing!costs!and!improving!quality.!
The!marketplaces!were!established!for!the!individual!and!small!group!markets,!and!gave!states!the!
option!of!establishing!their!own!marketplaces!or!defaulting!to!a!federally[facilitated!marketplace.!!
!
Wisconsin!has!decades!of!experience!operating!health!marketplaces—it!has!successfully!done!so!
for!its!state!employees!since!the!early!1980s.!Wisconsin!should!have!been!a!model!for!how!states!could!
operate!marketplaces.!Governor!Doyle’s!Administration!was!planning!a!state[based!marketplace!and!
even!had!a!working!model!for!it!by!the!end!of!his!time!in!office.!
!
Beginning!in!2011,!however,!Wisconsin’s!Legislature!and!Governor!Walker!have!consistently!
refused!to!establish!a!state[run!marketplace;!thus!Wisconsin!defaulted!to!a!federally[facilitated!
marketplace.!Despite!this!limitation,!fifteen!insurers!competed!in!the!Wisconsin!individual!Marketplace!
this!year.!Enrollees!could!choose!from!an!average!of!67!plans!in!each!county.!183,155!Wisconsinites!
enrolled!in!a!health!plan!via!the!Marketplace!in!2015.!The!overwhelming!majority—90.7%—of!them!
receive!federal!financial!assistance.!
!
Vision"for"a"Wisconsin"Marketplace"
!
Wisconsin!should!establish!its!own!marketplace!to!guarantee!local!control.!It!should!be!an!
independent!authority!that!is!not!politicized.!We!recommend!that!the!Legislature!and!Governor!establish!
a!state[based!marketplace!that!includes!the!following!elements.!These!recommendations!were!developed!
in!consultation!with!members!of!the!Wisconsin!Access!Network!(a!group!of!health!system!stakeholders),!
incorporate!recommendations!from!the!National!Association!of!Insurance!Commissioners’!model!act,9!
and!reflect!the!National!Academy!of!Social!Insurance’s!toolkit10!for!marketplace!implementation:!
A. Focus!on!Expanded!Access,!Reduced!Cost!and!Improved!Quality!
!
Wisconsin’s!marketplaces!should!pursue!policies!that!control!health!costs!while!simultaneously!
improving!quality.!To!achieve!these!outcomes,!the!state’s!marketplace!authority!should:!(1)!Proactively!
work!to!avoid!adverse!selection;!(2)!Have!pools!of!enrollees!that!are!very!large!in!size!as!a!percent!of!
both!urban!and!rural!areas,!average!in!risk,!and!with!clear!economic!incentives!for!consumers!to!choose!
low[cost,!high[quality!and!appropriate!plans;11!(3)!Promote!robust!competition,!maximize!consumer!
choices,!and!promote!convenient!access!to!quality!health!services!in!both!urban!and!rural!areas;!(4)!
Encourage!innovation!among!insurers!and!products!while!assuring!a!commitment!to!value!and!
coordinated!care;!and!(5)!Promote!transparency!and!accountability,!including!collecting!and!presenting!
quality!and!customer!rating!information.!!
B. A!Government!Authority!
!
An!independent!government!authority,!resulting!in!a!strong!public[private!partnership,!should!
administer!Wisconsin’s!marketplaces.!The!authority’s!board!and!employees!should!be!subject!to!strict!
conflict!of!interest!and!financial!reporting!requirements,!and!the!authority!should!be!subject!to!
Wisconsin’s!open!meetings!and!open!records!laws.!
C. Governing!Board!Membership!
!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!
!http://www.naic.org/store/free/MDL[929.pdf!!
!https://www.nasi.org/research/2011/designing[exchange[toolkit[state[policymakers!!
11 !For!more!on!these!concepts,!see!further!research!by!the!Community!Advocates!Public!Policy!Institute!at:!http://healthaffairs.org/blog/2014/12/18/the[
dane[difference[why[are[dane[countys[exchange[premiums[lower/!and!http://communityadvocates.net/ppi/programs/aca/the_dane_difference.php!!
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A!Vision!for!Effective!Implementation!of!the!Affordable!Care!Act!in!Wisconsin!
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A!board!should!govern!Wisconsin’s!marketplace!authority!that!consists!of!fifteen!members!who!
reflect!the!regional!and!cultural!diversity!of!Wisconsin,!and!should!include:!the!Secretary!of!the!
Department!of!Health!Services,!the!Medicaid!Director,!and!the!Commissioner!of!Insurance.!The!board!
should!also!include!the!following!members!with!staggered!and!fixed!terms:!a!qualified!actuary,!an!expert!
on!social!insurance,!a!local!public!health!official,!a!health!economist,!a!representative!of!Wisconsin’s!small!
businesses,!a!representative!of!Wisconsin’s!large!businesses,!a!representative!of!organized!labor,!an!
advocate!for!people!with!disabilities,!three!advocates!for!consumers,!and!one!member!of!the!authority’s!
Advisory!Committee!(elected!to!the!board!by!the!Advisory!Committee)!who!does!not!have!a!conflict!of!
interest!but!who!represents!the!view!of!the!Advisory!Committee.!
D. Advisory!Committee!Membership!
!
The!authority!should!be!required!to!consult!with!an!advisory!board!that!includes!providers!and!
insurers,!as!well!as!those!groups!required!by!the!ACA:!“educated!health!care!consumers!who!are!
enrollees!in!qualified!health!plans;!individuals!and!entities!with!experience!in!facilitating!enrollment!in!
qualified!health!plans;!representatives!of!small!businesses!and!self[employed!individuals;!state!Medicaid!
offices;!and!advocates!for!enrolling!hard!to!reach!populations.”!
E. Interaction!with!BadgerCare!and!Local!Departments!of!Health!and!Human!Services!
!
Wisconsin’s!marketplace!should!seek!to!maximize!enrollment!of!BadgerCare[eligible!residents!in!
the!BadgerCare!program!and!promote!continuity!of!care!for!those!who!transition!from!a!Qualified!Health!
Plan!offered!in!the!marketplace!to!any!other!health!coverage.!The!marketplace!should!also!interact!in!a!
coordinated!manner!with!county!departments!of!health!and!human!services!to!ensure!that!Wisconsinites!
receive!health,!mental!health!and!substance!use!disorder!treatment!without!gaps!in!care!and!that!is!paid!
for!by!the!most!appropriate!source.!
F. Navigators!and!Usability!
!
The!legislation!should!create!and!include!health!insurance!navigators!in!compliance!with!the!ACA!
and!federal!requirements.!Navigators!should!be!trained,!certified,!and!periodically!tested!and!recertified!
to!engage!in!education,!marketing,!and!program!outreach!on:!(1)!The!major!features!of!the!ACA;!(2)!The!
tax!for!not!purchasing!insurance;!(3)!Prevention!and!wellness;!(4)!Available!premium!and!cost[sharing!
subsidies;!(5)!Open!enrollment!and!reenrollment!periods;!(6)!The!requirement!of!reporting!changes!in!
circumstance;!(7)!Medicaid!(and!other!public!health!insurance!programs),!private!insurance,!and!the!
interaction!of!both;!(8)!How!to!select!a!plan!that!best!meets!the!individual’s/business’s!needs;!(9)!the!
total!cost!of!purchasing!insurance;!and!(10)!Health!insurance!literacy.!Navigators!should!not!be!required!
to!be!members!of!any!licensed!profession.!Both!the!marketplaces!and!navigators!should!also!be!
accessible!to!people!with!disabilities!and!people!who!have!a!primary!language!other!than!English.!
G. SHOP!Marketplace!Eligibility!
!
The!legislation!should!require!that!the!marketplace!authority’s!Small!Business!Health!Options!
Program!(SHOP!Marketplace)!be!open!to!Wisconsin!employers!of!any!size!after!January!1,!2017!(as!
allowed!by!the!ACA).!
H. Merger!of!SHOP!and!Individual!Marketplaces!
!
The!legislation!should!require!the!marketplace!board!to!conduct!an!analysis!(including!public!
hearings!and!a!public!comment!period)!of!the!options!(allowed!by!the!ACA)!of!merging:!(1)!The!
individual!and!SHOP!marketplaces;!and!(2)!The!individual!and!small!group!markets.!The!legislation!
should!also!direct!the!authority!to!implement!such!mergers!if!the!authority!certifies!to!the!Legislature!
and!governor!that!doing!so!would!result!in!improved!health!care!access,!lower!costs,!and!improved!
quality.!
I. Use!Federal!Information!Technology!Infrastructure!
!
Several!states,!including!New!Mexico,!Delaware!and!Pennsylvania,!have!proposed!or!implemented!
a!state[based!marketplace!that!uses!the!federal!healthcare.gov!information!technology!(IT)!
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A!Vision!for!Effective!Implementation!of!the!Affordable!Care!Act!in!Wisconsin!
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infrastructure.!Using!this!infrastructure!would!save!the!state!a!considerable!amount!of!money!because!
federal!funds!for!establishing!a!state[based!marketplace!are!no!longer!available.!It!would!also!avoid!
potential!IT!problems!that!other!states!have!experienced.!
J. Explore!Waivers!
!
The!Legislature!should!allow!the!marketplace!authority’s!board!to!convene!a!committee!to!explore!
and!report!on!potential!waivers!that!would!further!improve!health!access,!lower!cost,!and/or!improve!
quality,!which!the!ACA!allows!states!to!pursue!after!2016.!
"
Vision"for"Structure"
!
The!Legislature!should!allow!employers!of!any!size!to!use!the!SHOP!marketplace!and!consider!
merging!the!SHOP!and!individual!marketplaces!after!January!1,!2017.!Also!after!January!1,!2017,!all!
government!employers!in!Wisconsin!should!be!required!to!use!the!merged!marketplace!unless!they!opt!
out.!This!would!create!a!situation!in!which!all!of!Wisconsin’s!employers—indeed,!all!individuals!not!
covered!by!Medicaid,!Medicare,!or!other!governmental!health!care!systems—would!be!eligible!to!
participate!in!a!large!and!effective!health!insurance!exchange.!This!large!pool,!in!combination!with!the!
incentives!and!other!policies!that!drive!the!state!employee!health!plan,!could!substantially!lower!health!
insurance!costs!for!all!consumers.! !
!
The!Legislature!and!Governor!have!taken!only!one!legislative!action!to!“implement”!the!ACA:!a!law!
to!ban!abortion!coverage!by!plans!providing!insurance!in!the!ACA!Marketplace.!This!prohibition!should!
be!repealed.!
!
If!the!state!does!establish!its!own!marketplace,!the!state!marketplace!should!include!uniform!cost[
sharing!structures!for!each!metal!tier!of!plan!offered.!In!some!bidding!regions!under!the!current!
federally[facilitated!Marketplace,!there!are!more!than!50!plans!available!within!a!single!tier.!This!is!
cumbersome!and!confusing!for!consumers.!A!state[run!marketplace!could!establish!a!small!number!of!
uniform!benefit!designs!to!help!consumers!navigate!the!large!number!of!options.!Uniformity!would!also!
help!increase!competition!and!lower!costs,!while!allowing!for!consumer!choice!within!the!metal!tiers.!
!
For!more!than!three!decades,!Wisconsin!has!operated!a!health!insurance!exchange!for!state!
employees!(and!some!local!government!employees)!to!obtain!health!insurance!in!each!of!its!72!counties.!
The!model!has!its!origins!in!the!work!of!Stanford!University!economist!Alain!Enthoven,!who!has!argued!
that!changing!the!structure!of!competition!and!financial!incentives!in!a!health!marketplace!can!spur!
delivery!system!transformation.!The!Wisconsin!State!Employee!Health!Insurance!Plan!(WSEHP),!
operated!by!the!Department!of!Employee!Trust!Funds!(DETF),!facilitates!market!competition!in!each!
county,!requires!a!standard!benefit!package,!places!plans!in!price!tiers!that!encourage!consumers!to!
choose!the!lowest!cost!option,!and!provides!consumers!with!price!and!detailed!quality!information!about!
the!health!plans!competing!in!their!county.!
!
During!the!next!few!years,!states!and!the!federal!government!will!likely!seek!solutions!to!control!
costs!and!improve!quality!in!the!Affordable!Care!Act!(ACA)!health!insurance!marketplaces.!State!and!
federal!policymakers!should!look!carefully!at!the!decades[long!success!of!the!WSEHP!in!controlling!the!
rapid!rise!of!health!insurance!costs!in!Dane!County—where!Madison,!Wisconsin’s!state!capital,!and!the!
University!of!Wisconsin,!are!located—as!they!seek!to!improve!the!effectiveness!of!the!ACA’s!
marketplaces!and!health!insurance!costs!in!general.!The!WSEHP!consistently!obtains!substantially!lower!
health!insurance!premiums!in!Dane!County!than!in!Wisconsin’s!71!other!counties.!In!2013,!an!individual!
plan!in!the!WSEHP!was!about!$1,400!cheaper!annually!in!Dane!County,!or!16%!less!than!the!average!in!
the!rest!of!the!state;!and!a!family!plan!was!about!$3,500!cheaper,!also!a!16%!difference.!This!Dane!
difference!has!existed!for!at!least!a!decade,!with!the!gap!slowly!widening!over!that!time."!
!
Our!research!suggests!that!Dane!County’s!lower!premiums!appear!to!stem!largely!from!the!Dane!
exchange’s!very!high!share!of!the!private!health!insurance!market;!the!relatively!higher!median!income!of!
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the!Dane!County!population!(and!thus,!presumably,!Dane!County!members!of!the!WSEHP);!and!the!Dane!
County!exchange’s!use!of!a!large!number!of!integrated!delivery!systems!of!high!quality.!
!
Wisconsin’s!experience!in!creating!and!operating!72!health!insurance!exchanges!over!the!last!
several!decades!provides!several!important—indeed,!compelling—lessons!for!policymakers.!Our!
research!into!the!Dane!difference!is!particularly!useful!for!state!and!federal!policymakers!who!are!
looking!for!ways!to!refine!the!ACA’s!marketplaces!to!better!control!costs!and!improve!quality.!
!
Based!on!the!strength!of!our!evidence,!it!would!be!reasonable!for!policymakers!to!conclude!that!a!
health!insurance!exchange!is!far!more!likely!to!hold!down!premiums!and!costs,!without!sacrificing!
quality,!if!the!exchange!also!has!at!least!one,!and!optimally!more!than!one,!of!the!following!features:!
1) The!exchange's!pool!comprises!a!very!large!percentage!of!the!privately!insured!lives!in!the!
exchange's!bidding!region;!
2) The!exchanges!offers!a!large!number!of!high[quality!plans;!and!
3) Those!plans!are!integrated!delivery!systems.!
These!conclusions!assume!that!the!exchange!provides!pooled!members!with!a!standard!benefit!package,!
and!that!it!offers!them!a!clear!economic!incentive!to!choose!a!low[premium!health!care!plan!by!requiring!
them!to!pay!a!portion,!if!not!the!full!extra!cost,!of!a!plan!that!offers!a!higher!premium.12!!
!
Today,!many!Wisconsin!residents!who!do!not!have!employer[sponsored!health!insurance!buy!
individual!health!insurance.!But!some!fail!to!keep!up!with!their!monthly!insurance!premiums—ultimately!
losing!health!insurance!coverage—because!they!have!difficulty!sending!in!periodic!payments!to!meet!
their!portion!of!the!premium.!This!may!happen!despite!the!fact!that,!after!they!later!file!their!state!tax!
returns,!they!qualify!for!a!substantial!refund!that!they!might!have!used!to!pay!their!required!contribution!
to!premium.!!
!
Losing!health!insurance!coverage!can!result!in!untreated!illnesses,!which!in!turn!can!make!it!
impossible!or!difficult!for!individuals!to!work!to!support!themselves!and!their!families.!
!
Wisconsin!should!modify!the!state!income!tax!forms!to!permit!filers!who!get!a!refund!to!
voluntarily!direct!part!of!an!income!tax!refund!to!pre[pay!health!premiums.!
!
Similarly,!Congress!should!modify!the!federal!income!tax!withholding!forms!to!create!an!
opportunity!to!withhold!more!of!a!taxpayer’s!income!or!capture!some!of!the!taxpayer’s!refund!to!pay!
health!premiums.!There!are!capture!provisions!in!the!federal!tax!code!that!could!be!adjusted!to!
accomplish!this!goal.13!
!
Badger"Health"Account"Waiver"
!
Finally,!Wisconsin!should!explore!waivers!and!establish!its!own!unique!coverage!system.!The!
Legislature!could!seek!an!ACA!Section!1332!waiver!to!replace!parts!of!Wisconsin’s!current!health!
coverage!system.!Here!is!the!structure!for!one!potential!waiver:!
!
1.!All!residents,!regardless!of!income!or!age,!would!be!assigned!a!Health!Insurance!Account!
(Account)!that!would!be!credited!with!a!risk[adjusted!level!of!premium!support!(support);!
!
2.!The!Account!and!support!would!be!used!to!buy!health!insurance!on!a!per[person!basis,!unless!
the!Account[holder!opted!out!during!an!Individual!Responsibility!Waiver!timeframe.!Parents!or!
guardians!would!act!on!behalf!of!their!dependent!children!through!age!18.!The!Individual!Responsibility!
Waiver!timeframe!would!occur!during!the!month!of!October!that!precedes!the!program’s!first!year!of!
operation,!and!thereafter!within!30!days!after!a!child!is!born!as!a!resident!of!the!state!or!within!30!days!
after!an!individual!otherwise!becomes!a!resident!of!the!state.!If!an!Account[holder!opts!out!during!any!of!
these!time!frames,!the!Account[holder!may!opt!in!during!the!month!of!October!in!the!fifth!year!following!
!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!
!http://communityadvocates.net/ppi/programs/aca/the_dane_difference.php!!
!For!more!on!these!concepts,!see!further!research!by!the!Community!Advocates!Public!Policy!Institute!at:!http://healthaffairs.org/blog/2014/12/18/the[
dane[difference[why[are[dane[countys[exchange[premiums[lower/!and!http://communityadvocates.net/ppi/programs/aca/the_dane_difference.php!!
12
13
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A!Vision!for!Effective!Implementation!of!the!Affordable!Care!Act!in!Wisconsin!
!
6!
!
the!opt[out!year.!For!an!opt[out!to!be!effective,!the!Account[holder!must!provide!annual!evidence!that!he!
or!she!will!be!responsible!for!the!cost!of!all!health!services!provided!(including!both!emergency!and!non[
emergency!services)!during!the!opt[out!period.!Account[holders!65!or!older!who!have!enrolled!in!
Medicare!(or!other!Medicare!enrollees),!Department!of!Veterans!Affairs!(VA)!health!benefits,!and!military!
TRICARE!benefits!would!not!be!required,!however,!to!provide!such!evidence!of!individual!responsibility!
for!the!cost!of!all!health!services;!their!enrollment!in!Medicare,!VA!health!benefits!or!TRICARE!would!be!
deemed!sufficient!evidence;!
!
3.!Residents!with!an!“active”!Account!(i.e.,!those!who!did!not!opt!out)!would!use!their!support!to!
buy!a!Qualified!Health!Plan!(QHP)!that!includes!Essential!Health!Benefits!(EHB)!as!the!ACA!defines!
both.!The!actuarial!value!of!the!plan!would!be!95%.!Wisconsin’s!insurance!commissioner!would!establish!
a!uniform!deductible!and!uniform!co[pay!structure!for!non[preventive!services!and!prescription!drugs;!
!
4.!QHPs!would!bid!a!“benchmark”!premium!on!a!county[by[county!basis.!Bids!would!be!for!a!
“benchmark”!premium!for!each!county,!in!order!to!maximize!competition.!Based!on!actuarial!information!
for!the!state!(or,!if!there!are!significant!intra[state!differences,!based!on!actuarial!information!for!the!
county),!the!“benchmark”!premium!would!be!adjusted—down!or!up—on!a!standardized!basis!for!
different!age/sex!cohorts:!thus,!each!QHP's!bids!would!be!adjusted!for!the!risk!associated!with!age/sex!
based!on!a!predetermined!actuarial!formula!that!all!QHPs!would!know!in!advance;!
!
5.!The!difference!between!the!“benchmark”!premium!of!the!lowest!bidder!and!the!“benchmark”!
premium!of!all!other!bidders!would!be!applied!to!all!age/sex!cohorts!(In!other!words,!if!the!2nd!lowest[
bidding!QHP’s!“benchmark”!premium!was!$10/month!more!costly!than!the!lowest[bidding!QHP’s!
“benchmark”!premium,!that!$10/month!difference!would!be!the!extra!amount!that!Account[holders!in!all!
other!age/sex!cohorts!would!be!required!to!pay!to!enroll!in!the!2nd!lowest!bidder’s!QHP.).!This!policy,!
intended!to!ensure!that!Account[holders!of!all!ages!and!both!sexes!will!pay!the!same!extra!amount!if!they!
enroll!in!the!same!more!costly!QHP,!would!also!be!explained!to!all!QHPs!in!advance!of!their!bid!
submission;!
!
6.!Consistent!with!these!bidding!rules,!each!QHP!would!decide!on!the!county!or!counties!where!it!
wants!to!bid.!Each!QHP!could!also!alter!its!bidding!choices!in!any!subsequent!year,!i.e.,!add!or!subtract!
counties!where!it!bids;!
!
7.!The!dollar!value!of!the!premium!support!that!would!be!credited!to!each!“active”!Account!would!
equal!the!lowest!“benchmark”!premium!bid—adjusted!down!or!up!for!the!age/sex!cohort!in!question—in!
the!county!where!the!Account[holder!resides;!
!
8.!Account[holders!would!be!free!to!use!the!premium!support!that!is!thus!credited!to!their!
Accounts!to!enroll!in!any!QHP!that!bid!in!their!county.!Spouses!could!select!any!QHP;!parents!could!select!
any!QHP!for!their!children;!and!the!QHPs!chosen!by!each!Account[holder!within!a!family!could!be!the!
same!or!different,!thus!allowing!each!family!member!to!obtain!care!from!his/her!choice!of!doctor!and!
hospital;!
!
9.!However,!if!an!Account[holder!enrolls!in!a!QHP!(for!himself/herself!or!his/her!children)!that!
did!not!bid!the!lowest!“benchmark”!premium,!the!Account[holder!would!be!required!to!pay!the!full!extra!
amount,!each!month,!out[of[pocket!(Ideally,!the!federal!Internal!Revenue!Code!would!be!altered!to!
ensure!that!this!extra!amount!is!on!an!after[tax!basis.).!This!creates!a!powerful!and!enduring!incentive!for!
insurers!and!providers!to!attract!enrollees!by!being!the!lowest[cost!bidder!or!submitting!premiums!as!
close!to!the!lowest!bid!as!possible...and/or!by!improving!their!quality!of!care!and!health!care!outcomes!so!
as!to!justify!their!extra!cost...thus!rewarding!highly!efficient!integrated!delivery!systems!(or!any!other!
insurance!arrangement,!if!there!is!one!that!can!succeed!on!a!risk[adjusted!basis,!that!hold!down!costs!
while!improving!quality!and!outcomes.);!
!
10.!To!pay!the!cost!of!"active"!Account[holders'!premium!support!amounts!(i.e.,!roughly,!the!
product!of!all!“active”!Account!holders!x!number!of!months!each!uses!the!Account!x!the!risk[adjusted!
!
A!Vision!for!Effective!Implementation!of!the!Affordable!Care!Act!in!Wisconsin!
!
7!
!
lowest[bid!premium!support!amount!credited!to!the!Account)!and!the!cost!of!administration,!the!state!
would!establish!a!Health!Insurance!Account!Corporation!and!fund!it!as!follows:!
!
•!All!state!and!federal!Medicaid!funds!for!which!the!state!would!have!been!eligible!in!the!prior!
year!(assuming!“full!expansion”!of!Medicaid,!and!including!administrative!costs),!adjusted!in!future!years!
on!an!aggregate!basis!for!the!change!in!the!number!of!persons!below!150%!of!the!poverty!line:!
!
!
•!An!amount!equal!to!between!10%!and!12%!of!Social!Security!earnings!in!excess!of!
$20,000!per!year!of!such!earnings!(or!some!other!appropriate!allowance),!subtracted!from!worker’s!
earnings!to!the!extent!that!employers!do!not!decide!to!pick!up!the!cost!as!an!employee!benefit;!and!
!
11.!The!Health!Insurance!Account!Corporation!would!ensure!program!and!fiscal!integrity.!All!non[
individually[identifying!records!would!be!available!to!the!state’s!legislative!fiscal!agency!and!state’s!
legislative!auditing!agency;!the!program!would!be!subject!to!an!annual!audit!by!an!outside,!independent!
auditor;!and!the!head!of!the!corporation!would!be!required!to!submit!an!annual!report!to!the!governor!
and!legislative!committees!with!fiscal!and!health!jurisdiction.!
!
•!The!Corporation!would!be!governed!by!a!board!with!fifteen!members!that!reflect!the!regional!
and!cultural!diversity!of!Wisconsin,!and!should!include:!the!Secretary!of!the!Department!of!Health!
Services,!the!Medicaid!Director,!and!the!Commissioner!of!Insurance.!It!should!also!include!the!following!
members!with!staggered!and!fixed!terms:!a!qualified!actuary,!an!expert!on!social!insurance,!a!local!public!
health!official,!a!health!economist,!a!representative!of!Wisconsin’s!small!businesses,!a!representative!of!
Wisconsin’s!large!businesses,!a!representative!of!organized!labor,!an!advocate!for!people!with!
disabilities,!and!four!advocates!for!consumers.!All!members!would!be!required!to!avoid!conflicts!of!
interest!and!the!Corporation!would!be!subject!to!Wisconsin’s!Open!Meetings!laws.!
"
Summary:"Marketplace"Recommendations"
A. Wisconsin!should!establish!a!marketplace!authority;!
B. After!January!1,!2017,!Wisconsin!should!ensure!that!any!employer!can!participate!in!the!SHOP!
marketplace,!consider!merging!the!SHOP!and!individual!marketplace,!and!require!government!
employers!to!participate!in!the!marketplace;!
C. Wisconsin!should!repeal!the!prohibition!on!marketplace!plans!covering!abortions;!
D. Establish!uniform!cost!structures!in!each!insurance!plan!metal!tier!offered!in!the!marketplace;!
E. The!marketplace!should!seek!to!replicate!the!comparatively!lower!costs!found!in!Dane!County!in!
the!Wisconsin!State!Employee!Health!Plan!in!the!marketplace!by!ensuring!the!marketplace:!(1)!
has!a!pool!that!comprises!a!very!large!percentage!of!the!privately!insured!lives!in!each!bidding!
region;!(2)!offers!a!large!number!of!high[quality!plans;!(3)!those!plans!are!integrated!delivery!
systems;!and!(4)!offers!a!clear!economic!incentive!to!enrollees!to!choose!a!low[cost!plan!by!
requiring!them!to!pay!a!portion,!if!not!the!full!extra!cost,!of!a!plan!that!offers!a!higher!premium;!
F. The!marketplace’s!bidding!regions!should!be!Wisconsin’s!72!counties;!
G. Wisconsin!should!modify!the!state!income!tax!forms!to!permit!filers!who!get!a!refund!to!
voluntarily!direct!part!of!an!income!tax!refund!to!pre[pay!health!premiums;
H. Congress!should!modify!the!federal!income!tax!withholding!forms!to!create!an!opportunity!to!
withhold!more!of!a!taxpayer’s!income!or!capture!some!of!the!taxpayer’s!refund!to!pay!health!
premiums;!and!
I. Wisconsin!should!consider!seeking!an!innovative!Section!1332!waiver.!
!
!
2. BadgerCare"
!
!
A!Vision!for!Effective!Implementation!of!the!Affordable!Care!Act!in!Wisconsin!
!
8!
!
Full"Expansion"
!
The!Supreme!Court’s!2012!decision!in!NFIB%vs.%Sebelius!made!expanding!Medicaid!programs!
optional!for!states.!Despite!immense!pressure!to!expand!Medicaid!(known!as!BadgerCare!in!Wisconsin)!
from!the!Wisconsin!Hospital!Association,!the!Wisconsin!Medical!Society,!other!medical!providers,!and!
dozens!of!advocacy!organizations,!the!Governor!rejected!fully!expanding!BadgerCare!to!cover!adults!with!
incomes!up!to!133%!of!FPL.!The!state!instead!partially!expanded!BadgerCare!for!childless!adults!with!
incomes!up!to!100%!of!FPL,!and!reduced!BadgerCare!eligibility!for!parents!from!200%!of!FPL!down!to!
100%!of!FPL.!This!contraction!resulted!in!63,000!parents!losing!BadgerCare!coverage,!and!evidence!
suggests!that!nearly!38,000!of!them!may!not!have!gotten!covered!in!the!first!year!after!the!eligibility!
contraction.14!The!decision!to!limit!BadgerCare!to!those!up!to!100%!of!FPL—and!thus!exclude!those!
between!100%!and!133%!of!FPL—was!a!serious!mistake.!As!a!result,!Wisconsin!has!fared!less!well!than!
“expansion!states”!in!reducing!the!number!of!uninsured,!while!turning!aside!hundreds!of!millions!of!
federal!Medicaid!reimbursement!dollars.!The!solution!is!simple.!BadgerCare!should!be!expanded!to!
include!all!adults!age!18!to!64!with!incomes!up!to!133%!of!FPL.""
!
The!charts!below!detail!the!changes!proposed!by!the!Governor!and!adopted!by!the!Legislature!to!
BadgerCare!eligibility!that!took!effect!in!April!of!2014:!
!
!
"
"
"
"
"
"
"
!
!
!
!
According!to!the!nonpartisan!Wisconsin!Legislative!Fiscal!Bureau,!expansion!up!to!133%!of!the!
FPL!would!cover!over!80,000!more!Wisconsinites!and!save!state!taxpayers!$360!million!in!the!upcoming!
2015[2017!state!budget!biennium.15!Because!Governor!Walker!and!the!Legislature!set!the!eligibility!level!
for!adults!in!BadgerCare!at!100%!of!FPL,!however,!Wisconsin!can!only!draw!the!“regular”!federal!match!
rate!(FMAP)!of!58.23%!(for!2015)!for!childless!adults.!If!Wisconsin!were!to!expand!eligibility!to!cover!
adults!with!incomes!up!to!133%!of!FPL,!the!federal!match!rate!for!childless!adults!would!be!100%!in!
2016,!phasing!down!to!95!percent!in!2017,!94!percent!in!2018,!93!percent!in!2019,!and!then!90!percent!
in!2020.!
!
According!to!a!report!by!the!Kaiser!Commission!on!Medicaid!and!the!Uninsured!Wisconsin,!
expanding!BadgerCare!would!save!Wisconsin!$2.5!billion!over!the!next!ten!years.!The!report!indicates!
!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!
14
15
!
!https://www.dhs.wisconsin.gov/news/releases/071614.htm!!
!http://www.wisconsinbudgetproject.org/an[updated[overview[of[health[care[issues[in[the[2015[17[budget!!
A!Vision!for!Effective!Implementation!of!the!Affordable!Care!Act!in!Wisconsin!
!
9!
!
that!Wisconsin!is!the!only!non[expansion!state!that!would!save!money!by!expanding.!This!is!largely!due!
to!the!fact!that!Wisconsin!only!partially!expanded!BadgerCare!for!childless!adults.16!
!
Alternative"Approaches"to"Increasing"Access"
!
As!an!alternative!to!the!simple!version!of!“full!expansion”!of!its!BadgerCare!program,!Wisconsin!
could!consider!an!expansion!of!BadgerCare!that!uses!federal!Medicaid!dollars!to!enable!low[income!
Wisconsinites!to!buy!Qualified!Health!Plans!offered!via!the!Marketplace.!This!alternative!version!of!
expansion!would!cover!81,000!more!people!and!save!the!state!$241!million.!This!model!has!been!
implemented!in!several!states,!including!Iowa.17!Legislation!aimed!at!accomplishing!this!alternative!has!
been!drafted!and!introduced;18!but!it!has!stalled!because!of!strong!opposition!by!the!Governor!and!
legislative!majority!leaders.!
!
!
Coverage"of"Children!
"
!
A!final!area!of!concern!involves!coverage!of!children.!The!ACA!protects!eligibility!levels!for!
children!that!were!in!place!in!2010!through!2019!via!a!maintenance!of!effort!(MOE)!requirement.!After!
2019,!the!MOE!requirement!will!lapse.!Wisconsin!should!maintain!its!current!level!of!eligibility!for!
children!with!household!incomes!up!to!300%!of!FPL!beyond!2019,!since!this!approach!is!likely!to!
increase!the!probability!that!children!will!actually!be!insured.!
!
Summary:"BadgerCare"Recommendations"
A. Wisconsin!should!expand!BadgerCare!to!cover!all!adults!with!incomes!up!to!133%!of!FPL!to!cover!
over!80,000!more!Wisconsinites!and!save!$360!million!in!the!2015[2017!biennial!budget;!
B. In!lieu!of!a!traditional!BadgerCare!expansion,!Wisconsin!could!consider!an!alternative!Iowa[like!
expansion!of!BadgerCare!that!uses!federal!Medicaid!dollars!to!cover!those!eligible!for!BadgerCare!
with!a!Qualified!Health!Plan!offered!via!the!Marketplace;!and!
C. Wisconsin!should!maintain!the!current!level!of!eligibility!for!children!with!household!incomes!up!
to!300%!of!FPL!beyond!2019.!
!
!
3. Health"Care"Delivery"Models"
!
!
According!to!CMS,!“The!Medicaid!Health!Home!State!Plan!Option,!authorized!under!the!Affordable!
Care!Act!(Section!2703),!allows!states!to!design!health!homes!to!provide!comprehensive!care!
coordination!for!Medicaid!beneficiaries!with!chronic!conditions.”19!“To!be!eligible!for!health!home!
services,!an!individual!must!be!a!Medicaid!beneficiary!diagnosed!with!the!following!according!to!state[
defined!criteria:!(1)!two!chronic!conditions;!(2)!one!chronic!condition!and!risk!for!a!second;!or!(3)!a!
serious!mental!illness.!The!statute!creating!health!homes!listed!chronic!conditions!that!include!mental!
health!conditions,!substance!use!disorder,!asthma,!diabetes,!heart!disease,!and!overweight!(body!mass!
!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!
!http://files.kff.org/attachment/issue[brief[medicaid[expansion[health[coverage[and[spending[an[update[for[the[21[states[that[have[not[expanded[
eligibility!!
17 !http://familiesusa.org/product/state[medicaid[expansion[waivers!!
18 !http://host.madison.com/news/local/govt[and[politics/full[medicaid[expansion[could[save[state[as[much[as[million/article_75c5e4b5[1977[5606[8f1d[
47b34921a978.html!!
19 !http://www.medicaid.gov/State[Resource[Center/Medicaid[State[Technical[Assistance/Health[Homes[Technical[Assistance/Health[Home[Information[
Resource[Center.html!!
16
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A!Vision!for!Effective!Implementation!of!the!Affordable!Care!Act!in!Wisconsin!
!
10!
!
index!over!25).!States!may!propose!other!conditions!to!CMS!for!incorporation!into!their!health!home!
models.”20!
!
Wisconsin!has!only!one!health!home!model!approved!by!the!federal!government!via!a!state!plan!
amendment.!Wisconsin’s!health!home!is!targeted!at:!“Medicaid!and!BadgerCare!Plus!members!with!a!
diagnosis!of!AIDS/HIV!and!who!have!at!least!one!other!diagnosed!chronic!condition,!or!is!at!risk!of!
developing!another!chronic!condition.”!Health!home!services!are!targeted!to!Brown,!Kenosha,!Milwaukee!
and!Dane!Counties!only.21!
!
Funds!are!available!from!the!federal!government!to!assist!with!planning!health!homes.!Wisconsin!
should!request!planning!funds!and!seek!approval!for!establishing!further!health!homes!to!address!
chronic!conditions,!especially!mental!illness!and!substance!use!disorders.!
!
!
Summary:"Delivery"Model"Recommendation"
Wisconsin!should!request!planning!funds!and!seek!approval!for!establishing!further!health!homes!
to!address!chronic!conditions,!especially!mental!illness!and!substance!use!disorders.!
!
!
4. Benefits"
!
!
Since!2014,!Medicaid!and!all!individual!and!small!group!plans!sold!inside!and!outside!the!
exchanges!have!been!required!to!cover!“essential!health!benefits,!which!includes:!“Ambulatory!patient!
services;!Emergency!services;!Hospitalization;!Maternity!and!newborn!care;!Mental!health!and!substance!
use!disorder!services,!including!behavioral!health!treatment;!Prescription!drugs;!Rehabilitative!and!
habilitative!services!and!devices;!Laboratory!services;!Preventive!and!wellness!services!and!chronic!
disease!management;!and!Pediatric!services,!including!oral!and!vision!care.”22!
!
States!can!annually!choose!one!of!the!following!benchmark!health!insurance!plans!as!the!floor!for!
what!must!be!included!in!the!essential!health!benefits!package!in!the!state:!
• One!of!the!three!largest!small!group!plans!in!the!state!by!enrollment;!
• One!of!the!three!largest!state!employee!health!plans!by!enrollment;!!
• One!of!the!three!largest!federal!employee!health!plan!options!by!enrollment;!
• The!largest!HMO!plan!offered!in!the!state’s!commercial!market!by!enrollment.!
!
Wisconsin!did!not!choose!a!benchmark!plan;!thus!it!defaulted!to!the!small!group!plan!with!the!
largest!enrollment!in!the!state.!According!to!a!blog!post!from!the!Georgetown!Center!on!Children!and!
Families,!in!addition!to!selecting!a!new!benchmark!plan,!a!state!can!also!strengthen!the!benefit!standard!
by:!“Prohibit[ing]!substitution!of!benefits!within!categories,!Adopt[ing]!a!more!comprehensive!definition!
of!habilitative!services,!Adopt[ing]!a!strong!standard!for!pediatric!vision!and!dental!services,!Extend[ing]!
pediatric!services!to!children!up!to!age!21,!and!Set[ting]!strong!standards!for!prescription!drug!
benefits.”23!States!can!also!add!onto!the!essential!benefits!package.!!
!
Wisconsin!did!not!reach!its!“default!position”!by!carefully!examining!the!pros!and!cons!of!the!
various!alternatives,!and!then!choosing!the!“default!position”!as!the!best!alternative.!The!state!simply!
defaulted.!It!would!make!sense!to!use!a!more!deliberative!process!to!decide!what!our!benchmark!plan!
should!be.!Wisconsin!should!convene!stakeholders!to!examine!the!benchmark!decision!and!choose!the!
!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!
!http://www.medicaid.gov/state[resource[center/medicaid[state[technical[assistance/health[homes[technical[assistance/downloads/medicaid[health[
homes[overview.pdf!!
21 !http://www.medicaid.gov/state[resource[center/medicaid[state[plan[amendments/downloads/wi/wi[12[008[hhspa.pdf!!
22 !https://www.healthcare.gov/blog/10[health[care[benefits[covered[in[the[health[insurance[marketplace/!!
23 !http://ccf.georgetown.edu/all/states[need[select[essential[health[benefit[benchmark[plans[2017[soon/!!
20
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benchmark!that!offers!the!best!starting!point!for!consumers.!This!process!should!also!examine!what!
benefits!could!be!added!by!the!state,!including!the!potential!for!coverage!of!adult!vision!and!dental!care.!
!
The!ACA!offers!premium!subsidies!to!qualified!individuals!with!incomes!between!100%!and!400%!
of!FPL.!One!of!the!eligibility!tests!for!these!subsidies!is!whether!the!applicant!is!offered!employer[
sponsored!coverage!and!whether!that!coverage!is!“affordable.”!An!offer!is!considered!affordable!if!the!
employee[only!plan!premium!costs!less!than!9.5%!of!family!income.!If!an!individual!has!an!offer!of!an!
“affordable”!plan!that!satisfies!this!test,!his!or!her!family!cannot!obtain!subsidies.!This!is!commonly!
referred!to!as!“the!family!glitch.”!Federal!law!should!ensure!that!applicants!with!families!who!have!
employer[sponsored!individual!coverage,!and!are!seeking!to!buy!coverage!for!their!family!members!in!
the!ACA!marketplaces,!have!their!calculation!of!“affordability”!based!on!their!family!income.!This!could!
be!accomplished!by!federal!legislation!like!the!Family!Coverage!Act!introduced!by!Senator!Al!Franken!(D[
MN)!or!by!federal!regulatory!action.24!
!
Summary:"Benefits"Recommendations"
A. Wisconsin!should!convene!stakeholders!to!examine!the!benchmark!decision!and!choose!the!
benchmark!that!offers!the!best!starting!point!for!consumers!and!what!supplements!the!
Legislature!should!include,!including!potentially!covering!adult!dental!and!vision!care;!and!
B. Federal!premium!subsidies!should!be!available!to!applicants!with!families!who!have!“affordable”!
employer[sponsored!individual[only!coverage,!but!are!seeking!to!buy!coverage!for!their!family!in!
the!ACA!marketplaces!and!do!not!have!sufficient!resources!to!afford!such!family!coverage.!
!
5. Consumer"Protection"
!
!
The!ACA!protects!consumers!from!discrimination!by!insurance!companies!because!of!preexisting!
conditions,!prohibits!lifetime!and!annual!limits,!and!requires!insurers!to!spend!80%!of!premiums!on!
patient!care!and!only!20%!on!administrative!costs.!According!to!CMS,!“The!Affordable!Care!Act!brings!an!
unprecedented!level!of!scrutiny!and!transparency!to!health!insurance!rate!increases.!The!Act!ensures!
that,!in!any!State,!large!proposed!increases!will!be!evaluated!by!experts!to!make!sure!they!are!based!on!
reasonable!cost!assumptions!and!solid!evidence.!This!analysis!is!expected!to!help!moderate!premium!
hikes!and!provide!those!who!buy!insurance!with!greater!value!for!their!premium!dollar.”25!Wisconsin!has!
received!$4,958,844!to!perform!reviews!of!rates!that!insurers!propose!would!meet!or!exceed!a!10%!
increase.!
!
It!is!striking!that!every!rate!increase!proposed!in!Wisconsin!since!passage!of!the!ACA!has!been!
accepted.!Wisconsin!allows!insurers!to!file!their!insurance!rates!with!states,!and!use!those!rates!without%
any%review!by!state!regulators.26!!
!
It!is!unacceptable!to!accept!federal!money!to!perform!rate!reviews,!and!then!fail!to!diligently!
conduct!rate!reviews.!For!2016,!seven!insurers!in!Wisconsin’s!individual!market,!and!four!insurers!in!
Wisconsin’s!small!group!market!have!filed!rates!that!exceed!the!10%!threshold.!Wisconsin!should!
require!prior!authorization!of!rate!increases!before!they!go!into!effect!and!it!should!implement!a!robust!
rate!review!process.!!
!
!
Summary:"Consumer"Protection"Recommendation"
Wisconsin!should!become!a!state!that!requires!prior!authorization!of!rate!increases!before!they!go!
into!effect,!and!it!should!implement!a!robust!rate!review!process.!!
!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!
!http://www.franken.senate.gov/files/documents/140605FamilyGlitch.pdf!!
!http://www.cms.gov/CCIIO/Programs[and[Initiatives/Health[Insurance[Market[Reforms/Review[of[Insurance[Rates.html!!
26 !http://www.ncsl.org/research/health/health[insurance[rate[approval[disapproval.aspx!!
24
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!
!
6. Enrollment"Assistance"
!
!
During!the!2013[2014!ACA!open!enrollment!period,!139,815!Wisconsinites!selected!a!
Marketplace!plan.27!That!number!grew!as!2014!progressed.!During!the!2014[2015!open!enrollment!
period,!183,155!Wisconsinites!obtained!a!Marketplace!plan.28!Of!those!who!selected!a!plan!during!the!
open!enrollment!period,!44%!were!new!to!the!Marketplace!and!56%!were!reenrollees.!Of!the!reenrollees,!
19%!selected!a!new!plan.29!Certified!application!counselors!(CACs)!or!navigators!assisted!many!of!these!
individuals!with!their!application.!!
!
Funding"for"Assisters"
!
Enrollment!assisters!play!a!crucial!role!in!doing!outreach!to!those!interested!in!health!coverage!
and!informing!them!about!their!options.!Assisters!are!also!the!primary!points!of!contact!for!individuals!
needing!help!with!enrollment,!including!people!with!disabilities,!people!with!low!incomes,!and!
individuals!whose!primary!language!is!not!English.!The!Governor!and!Legislature!included!funding!for!
“administrative!support”!to!help!those!who!were!transitioning!from!BadgerCare!to!the!Marketplace!in!the!
2013[2015!biennial!state!budget.!Those!funds!were!also!used!to!support!the!important!coordinating!and!
organizing!work!of!Wisconsin’s!regional!enrollment!networks.!Regional!Enrollment!Networks!that!were!
most!successful!were!locally!coordinated!by!an!agency!or!agencies!that!had!already!established!
community!relationships.!However,!the!broader!work!of!coordination,!communication,!and!outreach!for!
enrollment!assistance!would!not!have!been!possible!without!the!supplemental!funding.!!
!
The!Department!of!Health!Services!has!indicated,!however,!that!“administrative!support”!funding!
will!no!longer!be!available!to!support!regional!enrollment!networks!in!the!2015[2017!state!budget!
biennium.!Funding!for!regional!enrollment!networks!should!be!made!available!via!the!state!budget!as!its!
own!line!item.!!
!
The!Department!of!Health!Services!contracts!with!local!consortia!of!counties!to!perform!the!
eligibility!and!caseload!management!functions!for!Medicaid.!There!are!ten!income!maintenance!consortia!
and!nine!tribal!agencies!that!are!charged!with!these!tasks.!The!Department!of!Health!Services!provides!
these!services!in!Milwaukee!County.!According!to!the!Wisconsin!Legislative!Fiscal!Bureau,!“Each!regional!
consortium!and!tribe!is!responsible!for!program!eligibility!determinations,!application!processing,!
operating!and!maintaining!a!call!center,!conducting!ongoing!case!management,!and!performing!lobby!
services!such!as!responding!to!questions,!facilitating!access!to!interpreter!services,!and!making!
informational!publications!available.!The!IM!consortia!and!tribes!cooperate!with!DHS!to!provide!other!
administrative!functions,!such!as!conducting!subrogation!and!benefit!recovery!efforts,!participating!in!
fair!hearings,!and!conducting!fraud!prevention!and!identification!activities.”30!!
!
The!2013[2015!Wisconsin!biennial!budget!included!supplemental!funding!for!the!income!
maintenance!consortia!to!respond!to!the!increased!workload!created!by!the!ACA.!This!funding!should!be!
preserved!and!enhanced,!and!the!consortia!should!have!access!to!this!funding.!The!federal!government!
should!also!continue!its!enhanced!funding!for!income!maintenance!activities!beyond!their!expiration!at!
the!end!of!2016.!
!
The!federal!government!contracts!with!navigators!to!do!outreach!about!health!coverage!and!assist!
individuals!needing!help!with!enrollment.!In!states!like!Wisconsin!that!have!a!federally[facilitated!
!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!
!http://aspe.hhs.gov/health/reports/2014/marketplaceenrollment/apr2014/ib_2014apr_enrollment.pdf!!
!http://www.cms.gov/Newsroom/MediaReleaseDatabase/Fact[sheets/2015[Fact[sheets[items/2015[06[02.html!!
29 !http://aspe.hhs.gov/health/reports/2015/MarketPlaceEnrollment/Mar2015/ib_2015mar_enrollment.pdf!!
30 !http://legis.wisconsin.gov/lfb/publications/budget/2015[17%20Budget/Documents/Budget%20Papers/368.pdf!!
27
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Marketplace,!the!federal!Centers!for!Medicare!and!Medicaid!Services!(CMS)!administers!the!navigator!
program!and!solicits!and!chooses!entities!to!perform!the!navigator!functions.!For!the!2014[2015!ACA!
open!enrollment!period,!three!local!entities!were!granted!a!combined!$994,403.!That!is!only!$4.70!for!
each!of!the!211,488!applications!completed!using!the!Marketplace!during!the!2014[2015!ACA!open!
enrollment!period.31!Beginning!with!the!2015[2016!ACA!open!enrollment!period,!navigator!grants!will!
extend!for!three!years,!which!is!an!improvement!over!the!previous!one[year!cycles.!However,!the!$67!
million!available!nationwide!for!navigators!is!not!enough!to!cover!the!demand!for!navigator!assistance.!!
!
The!federal!government!should!increase!the!amount!of!money!available!for!navigators!and!the!
State!of!Wisconsin!should!supplement!that!amount.!!
!
Enrollment"Assistance"in"Criminal"Justice"Settings"
!
In!November!of!2014,!the!Wisconsin!Department!of!Health!Services!released!an!operations!memo!
that!describes!the!process!for!individuals!being!released!from!Wisconsin’s!prisons!to!apply!for!
BadgerCare!before!being!released!from!prison.!Before!release,!inmates!call!the!local!income!maintenance!
consortia!office!and!submit!an!application!for!BadgerCare!over!the!phone.32!This!innovative!program!has!
been!successfully!operating!since!January!of!2015.!The!process!is!also!available!for!all!county!jails!to!
implement.!!
!
Only!a!handful!of!county!jails,!however,!appear!to!have!adopted!programs!that!assist!individuals!
transitioning!from!the!jail!to!the!community!with!enrollment!in!health!coverage.!Every!jail!in!Wisconsin!
should!implement!this!policy.!
!
Wisconsin!terminates!the!BadgerCare!coverage!of!individuals!who!are!incarcerated!and!serving!a!
sentence.!Other!states!have!been!successful!at!only!suspending!coverage.!This!not!only!speeds!up!the!
process!for!renewing!coverage!when!an!individual!leaves!incarceration!for!the!community,!it!would!also!
allow!the!Department!of!Corrections!to!apply!for!millions!of!dollars!of!federal!funding.!!
!
Wisconsin!should!suspend!BadgerCare!coverage!when!a!participant!is!incarcerated!instead!of!
terminating!coverage.!
!
Barriers"for"Assisters""
!
Non[agent!assisters!have!reported!that!supporting!individuals!in!need!of!assistance!is!hampered!
by!a!federal!and!state!requirement!that!any!documentation!related!to!their!prior!assistance!be!destroyed.!
These!documentation!destruction!requirements!should!be!repealed!so!that!assisters!may!better!provide!
ongoing!assistance.!
!
Consumer!assisters!report!a!number!of!other!issues,!including!difficulty!assisting!consumers!who!
elect!to!receive!snail!mail!notifications,!confirmations,!requests!for!information!and!other!supporting!
documents!from!the!state,!federal!government,!insurers,!and!intermediaries.!This!snail!mail!can!lead!to!
confusion!for!the!consumers!and!can!prevent!assisters!from!effectively!helping!individuals!with!
reenrollment,!maintaining!coverage,!and!reporting!changes.!Healthcare.gov!should!allow!assisters!to!
view!the!full!application!online!with!consumers,!as!call!center!representatives!are!able!to!do.!Electronic!
versus!paper!communication!should!not!be!an!either/or!choice,!but!should!always!be!maintained!and!
updated!in!the!electronic!record.!
!
Assisters!also!report!issues!with!individuals!having!gaps!in!coverage!because!of!delays!in!
processing!by!the!Marketplace,!individuals!who!mistakenly!are!enrolled!in!both!BadgerCare!and!a!
qualified!health!plan,!and!the!federal!call!center’s!challenges!in!helping!some!consumers!with!income!or!
citizenship!inconsistencies!that!require!provision!of!further!evidence.!The!federal!government!should!
continue!to!seek!stakeholder!input!and!audit!and!improve!its!processes!to!fix!these!problems.!
!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!
31
32
!
!http://aspe.hhs.gov/health/reports/2015/MarketPlaceEnrollment/Mar2015/ib_2015mar_enrollment.pdf!!
!https://www.dhs.wisconsin.gov/dhcaa/memos/14[49.pdf!!
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!
Assister"Accountability"and"Effectiveness"
!
Navigators!are!required!to!submit!a!significant!amount!of!information!on!their!activities.!
Unfortunately,!this!information!is!not!made!available!to!members!of!the!public!in!an!easy!to!access!
report.!Consumers!and!advocates!are!not!able!to!see!how!navigator!funds!are!being!spent!in!Wisconsin.!
The!federal!government!should!share!information!on!how!navigator!funding!is!being!used!to!assist!
consumers.!
!
Wisconsin!should!also!hire!an!independent!consultant!to!study!the!effectiveness!of!health!
coverage!outreach!and!enrollment!efforts,!audit!enrollment!and!eligibility!determination!processes,!and!
make!suggestions!for!how!to!improve!them,!particularly!with!regard!to!interoperability!of!systems!and!
usability!of!data!
!
Summary:"Enrollment"Assistance"Recommendations"
A. Funding!for!regional!enrollment!networks!should!be!made!available!via!the!state!budget!as!its!own!
line!item;!
B. The!2013[2015!Wisconsin!biennial!budget!included!supplemental!funding!for!the!income!
maintenance!consortia!to!respond!to!the!increased!workload!created!by!the!ACA.!This!funding!
should!be!preserved!and!enhanced,!and!the!consortia!should!have!access!to!this!funding;!!
C. The!federal!government!should!continue!its!enhanced!funding!for!income!maintenance!activities!
beyond!their!expiration!at!the!end!of!2016;!
D. The!federal!government!should!increase!the!amount!of!money!available!for!navigators!and!the!State!
of!Wisconsin!should!supplement!that!amount;!
E. Every!jail!in!Wisconsin!should!assist!individuals!transitioning!from!the!jail!to!the!community!with!
enrollment!in!health!coverage;!
F. Wisconsin!should!suspend—not!terminate—BadgerCare!coverage!when!a!participant!is!
incarcerated!instead!of!terminating!coverage;!
G. Federal!documentation!destruction!requirements!should!be!repealed!so!that!assisters!may!better!
provide!ongoing!assistance;!
H. Healthcare.gov!should!allow!assisters!to!view!the!full!application!online!with!consumers,!as!call!
center!representatives!are!able!to!do.!Electronic!versus!paper!communication!should!not!be!an!
either/or!choice,!but!should!always!be!maintained!and!updated!in!the!electronic!record.!
I. The!federal!government!should!share!information!on!how!navigator!funding!is!being!used!to!assist!
consumers;!!
J. Wisconsin!should!hire!an!independent!consultant!to!study!the!effectiveness!of!its!health!coverage!
outreach!and!enrollment!efforts,!audit!enrollment!and!eligibility!determination!processes,!and!make!
suggestions!for!how!to!improve!them;!and!!
K. The!federal!government!should!continue!to!seek!stakeholder!input!and!audit!and!improve!its!
processes!to!fix!enrollment!problems.!
!
!
7. Conclusion"
!
!
We!have!made!progress!towards!the!ACA’s!goals!in!Wisconsin.!Many!more!people!have!health!
coverage!that!offers!quality!benefits!at!an!affordable!rate.!Wisconsinites!are!safe!from!insurance!company!
discrimination.!This!vision!for!effective!implementation!of!the!ACA—including!a!state[based!marketplace!
that!is!focused!on!expanding!coverage!while!lowering!cost!and!improving!quality,!expanding!and!
!
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15!
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improving!BadgerCare!coverage,!establishing!innovative!health!delivery!models,!expanding!benefits,!
protecting!consumers,!and!improving!enrollment!assistance—would!further!the!ACA’s!goals,!increase!
Wisconsin’s!competitiveness,!and!lead!to!a!healthier!Wisconsin.!
"
Summary"of"Recommendations"
Marketplace"
A. Wisconsin!should!establish!a!marketplace!authority;!
B. After!January!1,!2017,!Wisconsin!should!ensure!that!any!employer!can!participate!in!the!SHOP!
marketplace,!consider!merging!the!SHOP!and!individual!marketplace,!and!require!government!
employers!to!participate!in!the!marketplace;!
C. Wisconsin!should!repeal!the!prohibition!on!marketplace!plans!covering!abortions;!
D. Establish!uniform!cost!structures!in!each!insurance!plan!metal!tier!offered!in!the!marketplace;!
E. The!marketplace!should!seek!to!replicate!the!comparatively!lower!costs!found!in!Dane!County!in!
the!Wisconsin!State!Employee!Health!Plan!in!the!marketplace!by!ensuring!the!marketplace:!(1)!
has!a!pool!that!comprises!a!very!large!percentage!of!the!privately!insured!lives!in!each!bidding!
region;!(2)!offers!a!large!number!of!high[quality!plans;!(3)!those!plans!are!integrated!delivery!
systems;!and!(4)!offers!a!clear!economic!incentive!to!enrollees!to!choose!a!low[cost!plan!by!
requiring!them!to!pay!a!portion,!if!not!the!full!extra!cost,!of!a!plan!that!offers!a!higher!premium;!
F. The!marketplace’s!bidding!regions!should!be!Wisconsin’s!72!counties;!
G. Congress!should!modify!the!federal!income!tax!withholding!forms!to!create!an!opportunity!to!
withhold!more!of!a!taxpayer’s!income!or!capture!some!of!the!taxpayer’s!refund!to!pay!health!
premiums;!and!
H. Wisconsin!should!consider!seeking!an!innovative!Section!1332!waiver.!
BadgerCare"
A. Wisconsin!should!expand!BadgerCare!to!cover!all!adults!with!incomes!up!to!133%!of!FPL!to!cover!
over!80,000!more!Wisconsinites!and!save!$360!million!in!the!2015[2017!biennial!budget;!
B. In!lieu!of!a!traditional!BadgerCare!expansion,!Wisconsin!could!consider!an!alternative!Iowa[like!
expansion!of!BadgerCare!that!uses!federal!Medicaid!dollars!to!cover!those!eligible!for!BadgerCare!
with!a!Qualified!Health!Plan!offered!via!the!Marketplace;!and!
C. Wisconsin!should!maintain!the!current!level!of!eligibility!for!children!with!household!incomes!up!
to!300%!of!FPL!beyond!2019.!
Health"Care"Delivery"Models""
Wisconsin!should!request!planning!funds!and!seek!approval!for!establishing!further!health!homes!
to!address!chronic!conditions,!especially!mental!illness!and!substance!use!disorders.!
Benefits"
A. Wisconsin!should!convene!stakeholders!to!examine!the!benchmark!decision!and!choose!the!
benchmark!that!offers!the!best!starting!point!for!consumers!and!what!supplements!the!
Legislature!should!include,!including!potentially!covering!adult!dental!and!vision!care;!and!
B. Federal!premium!subsidies!should!be!available!to!applicants!with!families!who!have!“affordable”!
employer[sponsored!individual[only!coverage,!but!are!seeking!to!buy!coverage!for!their!family!in!
the!ACA!marketplaces!and!do!not!have!sufficient!resources!to!afford!such!family!coverage.!
Consumer"Protection"
Wisconsin!should!become!a!state!that!requires!prior!authorization!of!rate!increases!before!they!go!
into!effect!and!it!should!implement!a!robust!rate!review!process.!!
Enrollment"Assistance"
A. Funding!for!regional!enrollment!networks!should!be!made!available!via!the!state!budget!as!its!
own!line!item;!
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B. The!2013[2015!Wisconsin!biennial!budget!included!supplemental!funding!for!the!income!
maintenance!consortia!to!respond!to!the!increased!workload!created!by!the!ACA.!This!funding!
should!be!preserved!and!enhanced,!and!the!consortia!should!have!access!to!this!funding;!!
C. The!federal!government!should!continue!its!enhanced!funding!for!income!maintenance!activities!
beyond!their!expiration!at!the!end!of!2016;!
D. The!federal!government!should!increase!the!amount!of!money!available!for!navigators!and!the!
State!of!Wisconsin!should!supplement!that!amount;!
E. Every!jail!in!Wisconsin!should!assist!individuals!transitioning!from!the!jail!to!the!community!with!
enrollment!in!health!coverage;!
F. Wisconsin!should!suspend—not!terminate—BadgerCare!coverage!when!a!participant!is!
incarcerated!instead!of!terminating!coverage;!
G. Federal!documentation!destruction!requirements!should!be!repealed!so!that!assisters!may!better!
provide!ongoing!assistance;!
H. Healthcare.gov!should!allow!assisters!to!view!the!full!application!online!with!consumers,!as!call!
center!representatives!are!able!to!do.!Electronic!versus!paper!communication!should!not!be!an!
either/or!choice,!but!should!always!be!maintained!and!updated!in!the!electronic!record.!
I. The!federal!government!should!share!information!on!how!navigator!funding!is!being!used!to!assist!
consumers;!!
J. Wisconsin!should!hire!an!independent!consultant!to!study!the!effectiveness!of!its!health!coverage!
outreach!and!enrollment!efforts,!audit!enrollment!and!eligibility!determination!processes,!and!
make!suggestions!for!how!to!improve!them;!and!!
K. The!federal!government!should!continue!to!seek!stakeholder!input!and!audit!and!improve!its!
processes!to!fix!enrollment!problems.!
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A!Vision!for!Effective!Implementation!of!the!Affordable!Care!Act!in!Wisconsin!
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