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State Democrat’s “Public Option” Bill a Bad Deal for Wisconsin

By Chris Reader, Institute for Reforming Government

At the end of February, Legislative Democrats announced the introduction of the “BadgerCare Public Option Act”, intended to, according to the author, Senator Chris Larson of Milwaukee, “…close the gap between which of our neighbors can afford health coverage and those who have it…” The bill fails to achieve this objective. Moreover, the bill is irrelevant and rhetorically disingenuous.

Per the published “Analysis by the Legislative Reference Bureau” (nonpartisan state agency that drafts legislation), the bill does the following:  1) requires the state Department of Health Services (DHS) to establish a separate purchase option for certain individuals who are ineligible for Medicaid (BadgerCare) solely due to their income exceeding eligibility limits, currently 100% of the federal poverty level (FPL); 2) establishes an option for small groups of 50 or fewer employees to purchase coverage under this new program; 3) requires DHS to establish a “basic health plan” as authorized by the Affordable Care Act for individuals earning up to 200% FPL; and 4) establishes a state-based exchange as authorized by the federal Affordable Care Act.

All the official legalese aside, this is the so-called “public option” bill, popular among the liberal elite who believe the ACA did NOT provide enough government control over your health care.  In other words, “public option” is another name for expanding government-run health care.  This bill simply adds more bureaucracy to our health care system under the guise of providing new options.  It excels at the former; fails at the latter.  It also would damage the successful coverage mechanisms, high-quality care delivery, and robust coverage choices we enjoy in Wisconsin today.

Nevertheless, let’s look even deeper.  The press release from Legislative Democrats says this bill will help people earning between 133% and 200% FPL.  However, the Kaiser Family Foundation Health Insurance Marketplace Calculator shows the group targeted in this legislation to already be eligible for subsidies covering 93% – or more – of the costs of coverage under the ACA exchange in Wisconsin.  In other words, the bill addresses a problem that doesn’t exist.

The small business components are built upon an equally weak foundation:  there is no guarantee of lower premiums, but there is near-certainty that providers would be paid less, forcing cost-shifting to those of us who purchase coverage outside of government programs. The hidden health care tax from cost-shifting has been a problem for years in Wisconsin, and this bill makes it worse.

But wait, there’s more.  According to Representative Supreme Moore Omokunde, the bill will “advance a more equitable health care system…”.  Nowhere in the bill analysis is equity mentioned as an outcome.  However, if the bill financially penalizes providers, the impact will be felt more heavily by people in areas already experiencing challenges with access to care.

The one component of the bill worth debating, transitioning to a state-based exchange, has little to do with the coverage issues referenced above.

Call it a public option, call it Medicare for All, call it Medicaid Expansion. This bill is a liberal talking point meant to distract from what was achieved by former Governor Walker and the Republican Legislature:  100% access to high-quality, affordable health care coverage through a Wisconsin model that focuses on consumer choice in the commercial marketplace, while providing a sustainable safety net for our neighbors in need. If enacted, this bill would add up to more expensive coverage, more regulation, and more needless bureaucracy.

Chris Reader is the executive vice president of the Institute for Reforming Government, a Madison-based think tank.

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1 thought on “State Democrat’s “Public Option” Bill a Bad Deal for Wisconsin

  • This is just a back-door way of ushering in single payer health care (nationalized insurance) on the state level. Obamacare screwed up our private healthcare system to the point that many individuals opted out of health care altogether until such time that they would need health care, and then would sign up for it immediately. Certainly does not meet the standard of health care insurance as was intended.

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