Wisconsin Institute for Law & Liberty
Press Release

Medicaid Expansion to Cost Wisconsinites $600 Million Per Year

New WILL, CROWE study analyzes true cost of Medicaid expansion

By - Feb 19th, 2019 11:00 am

The News: The Wisconsin Institute for Law & Liberty (WILL) and the Center for Research on the Wisconsin Economy (CROWE) at the University of Wisconsin-Madison released a new study revealing the true cost of Medicaid expansion to Wisconsin families. Though proponents highlight certain savings to the state, Medicaid expansion is expected to result in increased costs to families with private insurance – as much as $700 per year for a family of four, resulting in a net cost to Wisconsin of $600 million.

WILL and CROWE released this study in the Wisconsin State Senate Parlor, alongside lawmakers in both the State Senate and Assembly who stand in opposition to Gov. Tony Evers’ plans to put the federal Medicaid expansion into his upcoming budget proposal. Lawmakers included State Rep. Joe Sanfelippo (R-New Berlin), Chairman of the Assembly Committee on Health, State Sen. Duey Stroebel (R-Saukville), a member of the Senate Committee on Finance, State Sen. Chris Kapenga (R-Delafield), Chairman of the Senate Committee on Public Benefits, Licensing and State-Federal Relations, and State Sen. Dave Craig (R-Big Bend), Chairman of the Committee on Insurance, Financial Services, Government Oversight and Courts.

The Study:The Impact of Medicaid Expansion: Examining the cost to consumers and the net impact on Wisconsin, by WILL Research Director Will Flanders, and Noah Williams, Director of CROWE and Professor of Economics at the University of Wisconsin-Madison, reviews data from all 50 states and the District of Columbia comparing private sector health insurance costs and emergency room visits in states that expanded Medicaid eligibility and those that did not. The results include:

  1. Expanding Medicaid will increase the cost of healthcare on Wisconsinites with private insurance, on average, by $177 per year – up to $700 for a family of four.
  2. Emergency room visits would actually increase in Wisconsin, by over 52,000 visits per year.
  3. In total, Medicaid expansion is expected to cost Wisconsin over $1 billion per year – borne in large part by increases in private sector healthcare costs.
  4. Even when ‘savings’ to the state are included – Medicaid expansion will cost Wisconsin $600 million per year.

Why does Medicaid expansion result in increased costs?

  • Wisconsin has no health insurance coverage gap. Those who would move to Medicaid already have access to subsidized health insurance.
  • Medicaid reimbursement rates to healthcare providers are much lower than private health insurance. As a result, when people leave private health insurance for Medicaid, healthcare providers lose money on lower reimbursements. Likewise, an increase in use of more costly services like emergency room visits will drive up the cost of private healthcare.
  • Healthcare providers will pass along these costs to consumers.

The Quote: WILL Research Director Will Flanders said, “These costs are staggering and represent a misguided policy choice that would burden hard-working Wisconsin families already struggling with the cost of healthcare. The public deserves an honest debate about the true costs and trade-offs of any proposal that expands Medicaid in Wisconsin.”

CROWE Director Noah Williams added, “The way to contain healthcare costs and expand access to healthcare is not to move more Wisconsinites from private health insurance to a government run healthcare program. It is only through market forces, competition, price transparency, and increased variety through deregulation that healthcare costs will decrease and access will be widespread.”

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4 thoughts on “Medicaid Expansion to Cost Wisconsinites $600 Million Per Year”

  1. steven marshall says:

    Increasing the minimum wage would allow many people to afford private health insurance!
    The cost of a significant portion of our citizenry NOT having heathcare was not considered in this
    study was it! This includes unwanted pregnancies, infant mortality, missed work time, and much more.

    It is hard to worry about $177 per in projected health insurance increases (for those who have it)
    when we can expect much larger increases on a much larger current cost, in the private market
    anyway. My private medicare planC went up by more than that 6 months after I enrolled, and I am
    paying $1300 per MONTH for a cobra to cover my spouse until she reaches the medicare age.
    Another 15 dollars per month amounts to 1.2% or so. Most anybody would be happy if that s the level of
    annual increase!

    To date nationally no republican administration has even tried (much less succeeded) to bring
    these costs under control! Oh except Romney, the architect of the Affordable Care Act.

  2. blurondo says:

    The rule the states “there are three kinds of lies, little lies, damn lies and statistics” is alive and well.

  3. Jake formerly of the LP says:

    This reminds me that we need to contact the Milwaukee Common Council and make them pull the tax-exempt status on the Bradley Foundation’s mansion on the City’s East Side. This is absolute propaganda and lies, and it’s peddling a political agenda witj no public good involved.

    And as for that fraud Noah Williams and CROWE, they are Koched-up garbage masquerading as academia, and are sullying UW-Madison’s name.

    https://madison.com/ct/news/local/education/university/uw-madison-s-new-crowe-think-tank-funded-by-koch/article_e1cdb3eb-8bfa-5fc8-8d4f-56d9a9c12e3f.html

    FIRE THEM ALL, including the GOP slime who are trying to hide behind this cherry-picked fraud of a study.

  4. mkwagner says:

    This study flies in the face of reality. If the Medicaid expansion will raise insurance rates on individuals with private insurance, then would we simply have to examine the increase health insurance rates in states that did accept the expansion such as Minnesota… Well wait, Minnesota health insurance rates are 50% less than they are in Wisconsin. WILL, how do you explain that?

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