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The Department of Health Services (DHS) released a statement on the impact of federal budget cuts on Wisconsin Medicaid members in addition to an analysis of the potential impacts of the cuts. The U.S. House of Representatives is proposing as much as $880 billion in Medicaid cuts over ten years, and DHS wanted to analyze these potential cuts and the associated impact, including shifting costs, making services harder to access for working adults, and increasing costs to Wisconsin taxpayers. They found Wisconsin could lose up to $16.8 billion in federal funding if a per-person funding cap for Medicaid is implemented.
Wisconsin Director of Medicaid Bill Hanna said, "Wisconsin's Medicaid program is an essential part of our state's health care and public health systems and economy. Simply put, we can't have a healthy and strong Wisconsin without a healthy and strong Medicaid program. Massive cuts like those proposed by Congress would put our people, our health care system, and our economy at risk."
The Republican House Budget Committee is working on moving Medicaid to a per-capita-cap financing model in their 2025 budget resolution. In the resolution, the federal government would reimburse the state for Medicaid costs up to a set level for each beneficiary category. The authors said fraud in the program caused the 51% increase in Medicaid spending between 2019 and 2023. Currently, the federal government reimburses Wisconsin at a set percentage of eligible Medicaid costs. If Congress changes the rate to a set dollar amount per enrollee, DHS said the shift would tighten state budgets and burden taxpayers with medical costs if they increase quickly. They also argued that cuts would make it more difficult to effectively eliminate fraud.
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