Walker’s Rejection of Obamacare Funds to Cost WI Businesses Upwards of $36 Million

AP photoAccording to a national study by Jackson Hewitt Tax services, Wisconsin Governor Scott Walker’s opposition to Obamacare will cost Wisconsin employers between $24.1 million and $36.1 million a year.  

The news comes a month after Walker rejected expanding the states Badgercare program. Walker’s decisions on Medicare have created a scenario in which anyone who earns 100 percent of the federal poverty level, $11,490 a year for a single adult, will remain on Badgercare and anyone earning more is rejected and has to go into the federally subsidized marketplace.  Under Obamacare it was envisioned that state medicare programs would be capped for those earning 133 percent of the federal poverty level, or $15,282 for a single adult. 

Milwaukee County Executive Chris Abele told the Journal Sentinel:

“There’s no amount of taxes that’s too small to avoid if we can avoid them without impacts on the state,” Abele said of an expansion. “Everybody who’s looking out for taxpayers and the people they serve should be looking at this.”

The change in the figure of the cap puts much of the pressure on employers, leaving them saddled with financial penalties. According to Jackson Hewitt, putting these additional people into the exchanges, instead of covering them in BadgerCare, means they might face additional costs, in the form of premiums, deductibles or other costs. And if they have a job, their employers might have to pay more as well.

Employers with the equivalent of 50 or more full-time workers would pay a tax of between $2,000 and $3,000 per employee for anyone who receives a taxpayer subsidy to be covered under the federal health exchange. In Wisconsin, that would work out to just over 12,000 people, Jackson Hewitt estimated.

“Any projections of the ‘net’ costs of Medicaid expansions should reflect the very real costs of such liabilities to employers,” the report from the firm said.

County leaders are forced to find ways to expand their programs without Walker’s approval. Medicare expansion would likely bring federal money to regional hospitals.

In an interview, Outagamie County Executive Tom Nelson said that his county was working with aides of U.S. Sen. Tammy Baldwin (D-Wis.) and writing a letter to federal officials to see if it would be possible for his county to expand coverage even though Walker has already ruled out such a move for the state. Nelson said that he believed a Medicaid expansion would bring $29.6 million a year into his county alone.

“When you look at the numbers, we have a responsibility to make sure we get our fair share of those resources,” Nelson said.

Carrie Springer, a spokeswoman for Dane County Executive Joe Parisi, said that the idea had recently come to his attention and that the county was exploring whether it would be feasible.

State Health Services spokeswoman Stephanie Smiley says federal rules require Medicaid programs to be supervised by a single state agency and operate statewide in most cases. Jon Peacock, research director of the Wisconsin Council on Children and Families, said the shift of cost onto employers is virtually inevitable.

I hope state and local policy-makers will explore every option, but my guess is this will be a dead end,” Peacock said. “I don’t think that the feds will approve this on a piecemeal basis.”

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