Wisconsin Gov. Scott Walker wants $200 million to strengthen Obamacare and hold down premiums

MADISON - Stepping toward the political center in a difficult election year, Gov. Scott Walker proposed using $200 million in state and federal money to stabilize the state's Obamacare market and hold down rising insurance premiums.

While Republicans nationally talk about tax cuts, Wisconsin's GOP governor has mixed in proposals on health care, the overhaul of a troubled youth prison and funding schools at levels proposed by a leading Democratic challenger.

A fierce critic of Obamacare, Walker is set to use his eighth "state of the state" speech Wednesday to propose that the state "step up and lead" by strengthening the Affordable Care Act. As part of the broad health package, Walker also wants the Trump administration to permanently authorize SeniorCare, the prescription drug program that the governor once sought to scale back.

Walker's shift is a mark of both the congressional failure to overhaul Obamacare and a tough political climate in which Democrats have won special elections in northwestern Wisconsin and around the country.

“With Washington failing to act, we don’t think it gets better any time soon, in fact arguably it could get worse," Walker said of Obamacare on Friday. "And so ... where Washington fails to act, I believe it’s time for Wisconsin to step up again.”

Assembly Minority Leader Gordon Hintz of Oshkosh said Democrats would likely support many of Walker's proposals, but he criticized Walker for abruptly adopting longtime Democratic priorities. He said if Walker was sincere, he would also take additional federal money to expand the state Medicaid health program known as BadgerCare Plus, freeing up $203 million for the state next year.

"He's a great politician, but a terrible executive," Hintz said of Walker. "I don't know that the governor deserves credit for putting out fires that he started."

The governor said he's just "listening to people from all across the state."

"Dare I say that I don’t think those are Democrat issues. Those are Wisconsin issues. People care about them," Walker said.

The governor wants Wisconsin to spend $50 million in state money and $150 million in federal money to help hold down the premiums that insurers charge to consumers in the marketplaces set up by Obamacare.

More than 200,000 people use those marketplaces and most of them receive subsidies. But those who aren't eligible for subsidies have been hit by rising premiums and the exit of insurers like Molina Healthcare and Anthem Blue Cross and Blue Shield.

Last fall, Trump also stopped making certain federal payments to insurers, arguing that the Affordable Care Act and federal law didn't clearly authorize that.

Such payments can help insurers cover the high costs of covering sick consumers — something the insurers are required to do under the ACA. Without these federal payments, insurers have been under more pressure to cover their costs by raising premiums even higher on consumers and on the federal taxpayers who help subsidize those premiums.

Instead, Walker wants state lawmakers and the Trump administration to sign off on letting Wisconsin make payments known as reinsurance. The federal Centers on Medicare and Medicaid Services have already agreed to similar plans by other states like Minnesota, Alaska and Oregon, which have had some success in holding down premium increases.

Walker's plan would take effect in January 2019 and be paid for using savings from existing Medicaid programs rather than new money. Wisconsin's proposal would be similar to Minnesota's program and would help insurers cover the cost of patients with claims between $50,000 and $250,000.

The governor said that the proposal would quickly win approval from the GOP-controlled Legislature and the Trump administration, which has already been in talks with the state about it. Assembly Speaker Robin Vos (R-Rochester) and Senate Majority Leader Scott Fitzgerald (R-Juneau) didn't respond to questions about the plan.

Walker also said he would seek permanent federal approval for SeniorCare, the state’s prescription drug program that serves more than 92,000 Wisconsin residents aged 65 or older. The move comes after Walker twice tried to substantially scale back the program and put tens of thousands of Wisconsin seniors on the potentially more expensive federal Medicare Part D drug benefit.

Lawmakers from both parties rejected Walker’s past efforts to end SeniorCare and Walker’s administration got federal approval to continue the program, which gets both federal and state money.

Now, Walker wants to get permanent approval for the program before it expires in December 2018, instead of having to get federal sign-off for it every four years.

Sen. Jon Erpenbach (D-Middleton) said he welcomed the shift on SeniorCare but warned it could be misleading, saying the Trump administration may not be able to permanently approve it.

"As much as we'd like to see it as a permanent program, it couldn't be. ... I think that's probably going to take an act of Congress," Erpenbach said.

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Walker aides said they believed they could get approval from the Trump administration but couldn't cite an example of a Medicaid program getting a similar permanent authorization.

Walker also called on the GOP-controlled state Senate to pass legislation to prevent insurers from blocking patients with pre-existing conditions.

Assembly Bill 365 was written by Democrats but then extensively rewritten by Republicans in a late-night session. The bill would now require insurers to take patients with pre-existing conditions if they have a history of maintaining coverage. For those with gaps in their health coverage, state Commissioner of Insurance Ted Nickel would be required to propose a plan to help them.

Assembly Democrats voted against the bill during the tense late-night session, but Hintz and Erpenbach said they could potentially support the legislation going forward.