Wisconsin’s new state budget will continue funding for minimum Medicaid rates paid to assisted living and group homes that serve older people and adults with disabilities in the state’s Family Care program.
Last year, Gov. Tony Evers’ administration used $258 million in pandemic relief dollars to put the minimum rates in place after Republicans in the state Legislature declined to authorize them. The move was meant to shore up financial support for assisted living facilities, encouraging them to raise wages for in-demand caregivers.
Evers’ administration pushed the Legislature to continue funding the minimum rates once the pandemic dollars expired.
In the end, the measure made it into the bipartisan budget deal approved July 3.
The move guarantees minimum payments to group homes and other long-term care providers that serve people enrolled in Family Care, a state Medicaid program that provides long-term care, such as help with eating, dressing and bathing, to adults with cognitive or physical disabilities. There are nearly 57,000 people enrolled in Family Care and two related programs as of April, state data show.
For many facilities, the minimum rates are higher than what they were previously paid, the state Department of Health Services projected.
Wisconsin officials hoped the standardized rates would result in higher wages for caregivers, for whom demand is only growing. The rates are based on an assumption that workers are paid $15.75 an hour, although there’s no requirement for employers to pay that rate.
The 2025-27 budget provided funding to continue the rate schedule as-is, marking a win for advocates who worried the new model would end after the expiration of pandemic funds.
“We think that legislators really heard how important caregiving and Medicaid-provided caregiving is to their constituents,” said Rene Eastman, senior vice president of policy and finance at LeadingAge Wisconsin, a trade group that represents mostly nonprofit nursing homes and assisted living facilities.
In all, it will cost $258 million annually to continue, including a little over $100 million in state funds and nearly $160 million in federal funds.
“Without these critical investments, many assisted living facilities would have endured significant rate decreases at a time when wages and inflation continue to increase,” said Michael Pochowski, president and CEO of the Wisconsin Assisted Living Association.
He said the actions from last week “will help many assisted living facilities avert possible closure or exodus from the Family Care program.”
Minimum rates intended to create stability for assisted living facilities
Assisted living facilities and home care providers serving Family Care members routinely negotiate Medicaid rates directly with private companies that contract with the state to manage Family Care members’ care.
Before, there was no floor or standard rate.
For providers, that created inconsistency — and concerns about being undercut for care.
DHS and the Evers administration pushed for years for standard rates, as part of broader efforts to improve pay for assisted living facilities.
“The system now has at least a degree of predictability,” said Rick Abrams, chief executive of the Wisconsin Health Care Association, a trade group that represents nursing homes and assisted living facilities. “Before, if you were a good negotiator, you probably were able to negotiate a better rate.”
Health insurance giants Humana and Molina Healthcare manage services for three out of every five people enrolled in Family Care. A Humana subsidiary called iCare owns Inclusa, and Molina owns My Choice Wisconsin.
The recent entry of those major health insurers into Wisconsin’s long-term care space sparked concerns among disability rights advocates, who feared it would lead to more denials of care and cuts to services for Family Care members.
There also were concerns among assisted living homes that the health insurers would slash rates paid to them or cause delays in payments, making it harder for them to stay open.
Evers’ office has said that by establishing minimum rates, the state can require that companies like Molina and Humana pass some rate increases on to long-term care providers, giving them more stability and consistency.
The standard rates apply to assisted living facilities, including group homes, and supportive home care providers that offer supports with things like meal preparation and ensuring clients take their medications.
Cleo Krejci covers K-12 education and workforce development as a Report For America corps member based at the Milwaukee Journal Sentinel. Contact her at CKrejci@gannett.com or follow her on Twitter @_CleoKrejci. For more information about Report for America, visit jsonline.com/rfa.
Contact Sarah Volpenhein at svolpenhei@gannett.com or 414-607-2159. Follow her on X at @SarahVolp.
This article originally appeared on Milwaukee Journal Sentinel: Wisconsin’s new budget retains higher minimum rates for many assisted living homes in state’s Family Care program
Reporting by Cleo Krejci and Sarah Volpenhein, Milwaukee Journal Sentinel / Milwaukee Journal Sentinel
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