Gov. Tony Evers (D) gave his third biennial budget address on February 15, unveiling his 2023-25 executive budget. He proposes an operating budget of $103.8 billion over the next two fiscal years, adding a net 816.55 FTE positions. For comparison, the 2021-23 state budget spent $87.5 billion with a net reduction of 174.19 FTE positions.
The complete budget bill, budget in brief, and other executive budget documents are available here. The governor has also published his prepared remarks and a recording of his address, as well as selected excerpts.
By law, Gov. Evers’ budget will be introduced as a bill in the Wisconsin Legislature. The Joint Committee on Finance (usually Joint Finance Committee, JFC) will spend several months reviewing and altering the proposal. Based on past experience, we expect the following to happen:
- The Legislative Fiscal Bureau (LFB) will release a plain-language summary of the budget recommendations in about a month, that is, by the middle of March.
- JFC will hold agency briefings and conduct public hearings on the budget recommendations.
- The co-chairs of JFC will identify non-fiscal policy items and slate them for removal from the budget bill, which should occur roughly by the middle of April.
- JFC will vote, agency by agency, on changes to the budget.
- By June, the full budget should be available for debate and passage by both houses of the Legislature.
Republican legislative leaders reacted quickly and harshly to Gov. Evers’ address, with Republican Majority Leaders Sen. LeMahieu and Rep. August calling the proposal “out of control” and a “liberal wish list,” respectively. JFC Co-Chairs Sen. Marklein and Rep. Born issued statements promising to remove all of the governor’s taxing and spending proposals and non-fiscal policy provisions and start over. Meanwhile, Democrats on the finance committee released a joint statement supporting Gov. Evers’ executive budget.
Below is an overview of notable health care and insurance provisions in Gov. Evers’ budget proposal, separated by issue area.
Department of Health Services (DHS)
- Expands Medicaid eligibility for parents and adults from 100 percent of the federal poverty line ($27,750 annually in 2022 for a family of four) to 138 percent of the federal poverty line ($38,300 annually in 2022 for a family of four). Medicaid expansion is estimated to generate an additional $1.6 billion GPR over the biennium.
- Includes $1 billion GPR base funding for the Medicaid program that was transferred in the 2021-23 budget to the Medical Assistance Trust Fund.
- Extends postpartum eligibility from 60 days to 12 months ($11.5 million GPR over the biennium).
- Establishes and expands various Medicaid benefits including:
- A Medicaid community health benefit for nonmedical services ($10.1 mil GPR)
- Psychosocial rehabilitation services provided by noncounty providers ($691,900 GPR)
- Coverage of services provided by community health workers ($6.5 mil GPR)
- Coverage of room and board costs for residential substance use disorder treatment ($16.6 million GPR)
- Coverage of telehealth origination costs for schools ($3.6 mil GPR)
- Acupuncture services ($1 million GPR)
- Doula services ($449,300 GPR)
- Expanded coverage of certified peer specialists ($1.3 GPR)
- Coverage of continuous glucose monitoring devices and insulin pumps through the pharmacy benefit ($4.6 GPR)
- Increases payments to hospitals though a rate increase for hospital services, contingent on Medicaid expansion ($23.1 million GPR).
- Increases acute care and critical access hospital payments.
- Increases pediatric supplemental payments ($5.4 million GPR).
- Rate increases for various services including primary care ($64 million GPR, contingent on Medicaid expansion), emergency physician services ($10.9 million GPR), autism treatment services ($4.1 million GPR), and outpatient mental health and substance use disorder services and child adolescent day treatment ($5.7 million GPR).
- Provides $529,200 GPR for an easy enrollment program that allows uninsured individuals to have their income tax returns checked for Medicaid eligibility or eligibility for the health insurance exchange marketplace.
- Maintains a 5 percent rate increase for home and community based services, previously funded with one-time federal assistance ($80 million GPR).
- Provides $30 million to increase the direct care and services portion of capitation rates for Family Care MCOs.
- Provides $30 million for direct care funding for personal care services.
- Includes one-time funding for grant to analyze low-value care in Medicaid and state employee health plans ($1.8 million GPR).
- Invests in Home and Community Based Services, including $44.5 million to develop a minimum fee schedule for HCBS.
- Recommends funding for a complex patient pilot program transitioning from acute care providers to long-term care settings ($15 million GPR).
- Creates a Medicaid pay-for-performance incentive for nonhospital providers participating in a health information exchange ($6.8 million GPR).
Office of the Commissioner of Insurance (OCI)
- Establishes a state-based health insurance marketplace under the federal Affordable Care Act
- Requires OCI to establish standards for insurer networks for all health insurance plans offered in the state, such as requiring that a covered service is available within a minimum time and distance of the plan holder.
- Adjusts the office’s base budget to reflect an estimate of reinsurance payments provided to insurers under the Wisconsin Healthcare Stability Plan to pay for high-cost individuals on the federal marketplace exchange.
- Recommends adjusting the spending limit of the Wisconsin Healthcare Stability Plan reinsurance program to reflect changes in the consumer price index for medical care spending, as determined by the U.S. Department of Labor.
- Provides $1 million in each year for the office to conduct an analysis and actuarial study for the development of a public option health insurance plan.
- Establishes a Prescription Drug Affordability Review Board to observe practices in the pharmaceutical industry, analyze other state and national prescription drug practices and policies, establish public sector entity spending limits, and set price ceilings on certain prescription drugs.
- Establishes an Office of Prescription Drug Affordability (16.0 FTE) to administer the prescription drug regulatory provisions included in this executive budget and to further analyze and develop policy initiatives aimed at reducing prescription drug costs and increasing affordability.
- Establishes an insulin program and recommends limiting out-of-pocket costs for a one-month supply of insulin to $35 under all health insurance plans offered in Wisconsin.
- Recommends importing generic, off-brand drugs from Canada into Wisconsin.
- Recommends the office conduct a study into the feasibility and effectiveness of coordinating a state-run prescription drug purchasing entity for state and local government payers or purchasers and any additional payers or purchasers that may wish to participate.
- Requires pharmacy benefit management brokers and consultants, pharmacy services administrative organizations, and pharmaceutical sales representatives be licensed to practice in the state.
- Recommends pharmaceutical sales representatives complete continuing education in ethical standards, whistleblower protections, and the laws and rules applicable to pharmaceutical marketing; disclose any contacts made with health care professionals; and disclose any items, including a product sample, compensation, material or gift, that are provided to a health care professional.
- Requires pharmacy benefit managers to owe a fiduciary duty to insurers and other payers with whom they contract to reduce the potential for unnecessary cost increases within the prescription drug market.
- Requires prescription drug cost reductions received from prescription drug manufacturer coupons and other discounts to count toward a plan holder’s deductible or out-of-pocket maximum. Only discounts for brand name drugs that have no generic equivalent and brand name drugs that have undergone prior authorization by a prescriber or the insurer are eligible in order to avoid incentivizing the purchasing of more expensive brand name drugs over their generic equivalents.
- Requires pharmacy benefit managers and other third-party payers to reimburse certain federal 340B drug discount program participants for prescription drug purchases at the same rate that non-340B program participants are reimbursed to end discriminatory reimbursement practices.
- Establishes parity provisions to ensure patients utilizing telehealth services are not charged or have their services limited any more than if they utilized an equivalent in-person service to increase the availability and affordability of telehealth services.
- Requires regulation of balance billing practices.
- Modifies the initial and aggregate plan duration for short-term, limited-duration health insurance plans from 12 months to 3 months and from 18 months to 6 months, respectively.
- Requires insurance plans to cover substance use disorder counselors, infertility treatments, and services provided by qualified treatment trainees.