Wisconsin’s Brutal Cuts to Medicaid Prove Necessity of Medicare for All

By Karl Locher

During the infamous lame duck legislative session in the closing days of 2018, the Wisconsin legislature passed a breathtakingly reactionary agenda. The rapid move to limit the power of the incoming Evers administration was the object of significant attention in state and national news media. Indeed, as much as the Wisconsin Republican Party made great efforts to withhold information from the public during the legislative session, it was a nonetheless brazen – and largely successful – attempt to restructure Wisconsin’s government. The consolidation of power into the hands of a few members of the Wisconsin Republican Party was unquestionably an affront to democratic process.

Amidst the outrage over the shamelessly undemocratic grab for power, the legislature and waning days of the Walker administration quietly made drastic cuts to Wisconsin’s Medical Assistance program, called BadgerCare Plus. Medical Assistance, known better as Medicaid, is the federal program to provide healthcare to the poorest Americans. The income eligibility requirements vary from state to state, and in Wisconsin vary depending on your family status. For example, as of 2020, in order for a childless adult to qualify for BadgerCare Plus, they must have an income of $1,063.33 or less per month.

To understand why BadgerCare Plus is so vulnerable to swift and uncontested austerity measures, one needs to understand how it came to be a program in the first place. Medicaid was created in 1965 alongside the federal Medicare program. Unlike Medicare, Medicaid is largely administered by state governments in a shared cost model. This means that the federal government requires states to create their own Medicaid programs, including eligibility requirements and medical reimbursement rates, and in return, the federal government will cover a percentage of the cost of that program. Wisconsin followed the trend set by other states by privatizing the delivery of Medicaid coverage for most enrollees when it formed BadgerCare in 1999. In this model, the state pays Health Management Organizations (HMOs) and Managed Care Organizations (MCOs) to provide healthcare for BadgerCare enrollees. 

The privatization of BadgerCare – and then eventually BadgerCare Plus – purported to save money for the state while delivering the benefits of commercial insurance to enrollees. Like many other neoliberal initiatives, HMOs and MCOs were sold as a shot of market innovation and consumer choice into a supposedly anachronistic government program. In reality, these two qualities of Medicaid – that it is a cost-share program and relies on privatized service delivery – created exploitable opportunities for profit-seeking at the expense of the quality and access to healthcare. Cost sharing puts states in the position of seeking to reduce their own budget burden while maximizing federal revenue for Medicaid services. Privatized service delivery creates an opportunity for a corporation to accept government reimbursement for services, and then to deliver as infrequently and as profitably as legally possible. 

From the beginning, Medicaid was vulnerable to privatization efforts. Over the last forty years, programs that are devolved to state administration, like Medicaid, and are “means-tested” – meaning they require meeting certain income requirements in order to enroll as opposed to universal enrollment in services – have been the targets of corporate profiteering. Because these programs are shifted onto states, which have considerably lower capacity for revenue generation than the federal government, they are more prone to be thrown into crises of “sustainability” during downturns in consumption-driven sales tax revenue. Further, as “means-tested” programs, social welfare programs like Medicaid are construed as “handouts” to unproductive members of society and are politically vulnerable to schisms in class consciousness. Unlike Medicare, which is a widely perceived as a universal right for all, Medicaid is increasingly construed as both a drag on state budgets and an entrapment scheme for the working class whose livelihood should rely less on government programs and more on their employers’ begrudgingly paid benefits. 

The result of the slow transformation of Medicaid into a market for private profit has been devastating to the livelihoods of poor and working-class people in Wisconsin. The recent changes to BadgerCare passed under the lame duck session will affect “childless adults” with incomes under 100% of the federal poverty level. What was formerly no-premium health insurance will now require monthly premiums in addition to copays for Emergency Room visits. Particularly devastating are that these fees must be paid by the 10th day of the month following a billing period. The bill cannot be paid in cash or in-person, it must be paid with a credit card or money order. If someone doesn’t pay, they will lose their coverage and be made ineligible to re-enroll for a 6-month period. For reference, about 150,000 people across the state will be affected by this change. 

These measures are a deliberate attempt to strip the poorest Wisconsinites of health coverage and it will likely be very successful in doing so. There is voluminous data that poor people are underserved and intentionally exploited by banks and often cannot access the kind of payment services required to meet these copays. The obfuscation and complication of this payment scheme will result in thousands of people losing life-saving, crucial healthcare

The lame duck session signals a new phase in the politics of austerity. State governments are moving beyond the point where services are merely handed over to private industry and are now taking unprecedented steps to cut social services altogether. The first step, of privatization, was crucial in taking a public good and turning it into a private commodity. In doing so,  state governments have changed public consciousness of programs like Medicaid so that they are not seen as rights – which can be fought over in public politics – but instead as private goods that are hidden from public consciousness and can be removed without political backlash.

The lame duck session signals a new phase in the politics of austerity. State governments are moving beyond the point where services are merely handed over to private industry and are now taking unprecedented steps to cut social services altogether.

The fate of BadgerCare – and Medicaid generally – is proof of the need for Medicare For All and a system of socialized medical services. The centrist suggestions of “medicare for all who want it” should be quickly dismissed as political dead-ends that would doom countless individuals to death by inadequate healthcare. The structural similarities between Medicaid and “medicare for all who want it” are uncanny. It is clear that an “optional” federal Medicare program would lead to private health providers and insurers simply opting-out of providing care. “Medicare for all who want it” would quickly devolve into a stigmatized program of insufficient healthcare comprised of a begrudging network of providers doing the legally mandated bare minimum. It isn’t difficult to imagine that this too, like Medicaid, would eventually be seen as a pariah in need of a private savior, before it’s supposed savior puts it to a quiet death.

Socialized medicine, best represented through the Medicare For All movement, provides more than a technical solution that private health care has failed to deliver. Medicare For All could, for the first time, create a consciousness of health care as a public good and a universal right. This creates broader class consciousness, even if it is sometimes more like class unconsciousness. As people begin to view threats and injuries to such programs as an injury to their own well-being, they can see it also as an injury to their community and develop empathy for other people who also rely on the program. It is not coincidental that cuts and privatization efforts have been much less successful with universal programs like Social Security and Medicare than they have been for means-tested programs like Medicaid and TANF. As political centrists and leftists debate a – perhaps unfortunately – shared political path for the next four years, it is crucial that we build strength through the Medicare For All movement and that socialized medicine is a galvanizing principle of our politics.

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