1995 - 1996 LEGISLATURE
August 7, 1995 - Introduced by Representatives Wood, Underheim, Grobschmidt,
Huber, Klusman, Krusick, Springer, F. Lasee, Albers, Ziegelbauer, Goetsch,
Ladwig, Musser, Baldus, Boyle, Reynolds, Hasenohrl, Kreuser, Hahn, Otte

and Olsen, cosponsored by Senators Weeden, Huelsman and Andrea.
Referred to Committee on Health.
AB500,2,2 1An Act to repeal 49.47 (6) (a) 1. and 49.47 (6) (a) 6m.; to renumber 632.72 (1)
2and 632.755 (2); to renumber and amend 49.002 (2), 49.01 (5m), 49.043, 49.06
3(3), 49.47 (6) (a) (intro.), 49.47 (6) (a) 6., 49.47 (6) (a) 7. and 635.01; to
4consolidate, renumber and amend
49.035 (1) (intro.) and (d) and 49.046 (3)
5(b) 1. to 3.; to amend 20.435 (4) (eb), 40.51 (8), 40.51 (9), 40.51 (15m), 46.275
6(6), 46.278 (8), 49.015 (3), 49.032 (4r), 49.035 (2) (b) 7. and 8., 49.035 (2) (cm)
7(intro.), 49.035 (4e) (a) and (b), 49.035 (6) (am) and (b), 49.43 (8), 49.43 (10),
849.45 (8m) (intro.), 49.45 (24m) (a), 49.45 (37) (intro.), 49.46 (2) (a) (intro.), 49.46
9(2) (b) (intro.), 49.475 (1) (a), 613.03 (3), 625.12 (2), 625.15 (1), 625.22 (1), 628.34
10(3), 628.36 (2) (b) 5. and 632.70; and to create 20.145 (9), 40.51 (17), 46.27 (11)
11(e), 49.002 (2) (b), 49.01 (5m) (b), 49.02 (5m), 49.02 (20), 49.035 (4e) (d), 49.043
12(2), 49.046 (3) (b) 2., 49.046 (4) (bm), 49.06 (3) (b), 49.44, 49.45 (50), 49.46 (2)
13(bm), 49.465 (10), 49.47 (6) (ag) 7., 49.47 (6) (as), 49.47 (15), 49.49 (7), 632.72
14(1c), 632.755 (2) (a), 635.01 (2) and chapter 637 of the statutes; relating to:
15creating a basic health insurance plan, establishing a subsidy program for
16premiums under that plan, seeking a federal waiver or federal legislation
17regarding medical assistance, medical assistance benefits and providers,

1medical benefits under the general relief and relief of needy Indian persons
2programs, granting rule-making authority and making appropriations.
Analysis by the Legislative Reference Bureau
This bill requires the department of health and social services (DHSS) to
request a waiver, developed in consultation with and approved by the commissioner
of insurance (commissioner), from the secretary of the federal department of health
and human services to allow the state to receive federal funding to provide health
care coverage under a basic health insurance plan (basic plan), to be designed by rule
and administered by the commissioner, to certain persons who are eligible for
medical assistance for reasons related to aid to families with dependent children
eligibility (covered persons). If the waiver request is denied, DHSS is required to
seek federal legislation instead of a waiver. Any waiver or legislation must seek to
obtain an amount of federal funding, expressed as a percentage of total program
costs, including both administrative and benefit costs, to cover eligible persons under
the basic plan that either exceeds or is substantially equivalent to the amount of
federal funding, expressed as a percentage of total program costs, including both
administrative and benefit costs, available to provide medical assistance to covered
persons. If DHSS determines that a waiver is approved, or legislation is enacted,
that meets the maintenance of federal effort requirement and if DHSS determines
that state legislation has been enacted making appropriations specifically for the
purpose of providing health care coverage under the basic plan to covered persons
and specifically for the purpose of funding premium subsidies, DHSS is required to
certify its determination to the commissioner on the first day of the first month
beginning after the waiver is approved or the legislation is enacted. The
commissioner is required to implement that basic plan coverage no later than the
first day of the 12th month beginning after the certification is made.
The basic plan is to be designed to provide basic coverage of hospital, surgical
and medical services and items. It must provide both single and family coverage; it
must require a copayment of at least $2 for every service or item covered; it may be
exempted by the commissioner from any health insurance mandate; and it may not
provide abortion coverage except in a case of sexual assault or incest or if the abortion
is medically necessary to save the life of the woman or to prevent grave, long-lasting
physical health damage to the woman due to a medical condition existing prior to the
abortion. Any employer, including the state and its political subdivisions, and any
individual who is a resident of this state and who does not have coverage under the
basic plan through an employer, except for an individual who has coverage under the
health insurance risk sharing plan (HIRSP), is eligible to purchase coverage under
the basic plan. Such an employer or individual who voluntarily terminates coverage
under the basic plan is not eligible again for coverage under the basic plan for 12
months.

The commissioner may, but is not required to, divide the state into regions for
the purpose of pooling individuals and employes with coverage under the basic plan.
The commissioner must select insurers to provide coverage under the basic plan by
using a competitive sealed proposal process.
An insurer that is selected by the commissioner to provide coverage must
provide coverage under the basic plan, without regard to health condition or claims
experience, to any employer that agrees to pay the premium and comply with all
other plan provisions and to any of the employer's employes and their dependents;
to any individual who is eligible for coverage and who agrees to pay the premium and
comply with all other plan provisions and to such an individual's dependents; and to
any individual who is entitled to coverage and to such an individual's dependents.
Coverage under the basic plan must be community rated. The community rates,
however, may be modified according to the insured's age, gender, geographic area and
tobacco use and by whether the insured's coverage is single or family. The
commissioner must by rule prescribe rate bands for the modifications and may also
by rule prescribe rate restrictions that provide for a transition to the modified
community rates.
The basic plan may not deny, exclude or limit benefits on account of a
preexisting condition for more than 12 months after the commencement of coverage
(and may not deny, exclude or limit benefits on account of a preexisting condition for
any amount of time for a person who has coverage because he or she is eligible for
medical assistance) and may not define a preexisting condition more restrictively
than a condition for which the insured sought or should have sought medical care
during the 12 months immediately preceding coverage or more restrictively than a
pregnancy existing on the effective date of coverage, except that coverage may not
be excluded for covered expenses for such a pregnancy that exceed $5,000. An
individual who has been a resident for at least 6 months or an employe may obtain
coverage without any preexisting condition exclusion or limitation if he or she
applies for coverage during a biennial 30-day open enrollment period specified by
the commissioner by rule. Additionally, the basic plan must waive any period
applicable to a preexisting condition exclusion or limitation that was satisfied under
another health care plan, including medical assistance but excluding HIRSP, under
which the insured had coverage that terminated 60 days or fewer before the effective
date of coverage under the basic plan. These preexisting condition exclusion or
limitation and portability provisions are very similar to those required under current
law for a group health benefit plan issued to a small employer (one that employs
between 2 and 25 employes with a normal work week of 30 or more hours). Under
current law, a group health benefit plan issued to a small employer may not exclude
or limit benefits on account of a preexisting condition for more than 12 months after
the commencement of coverage and may not define a preexisting condition more
restrictively than a pregnancy existing on the effective date of coverage or a condition
for which the insured sought or should have sought medical care during the 6 months
immediately preceding coverage. Additionally, such a plan must waive any period
applicable to a preexisting-condition exclusion or limitation that was satisfied under
another plan, including medical assistance, under which the insured had coverage

to a date not less than 30 days before the effective date of coverage under the new
plan.
The bill requires the commissioner to establish and administer a program to
subsidize premiums for coverage under the basic plan. An individual or an employe,
other than one eligible for medical assistance, would be eligible for a premium
subsidy if he or she had a family income in the preceding year that was less than
200% of the poverty line for a family the size of his or her family. For an individual
or an employe with a family income that did not exceed 100% of the poverty line, the
amount of the premium subsidy would be 100% of the premium cost. For an
individual or an employe with a family income of between 100% and 200% of the
poverty line, the amount of the premium subsidy would be reduced from 100% of the
premium cost by one percentage point for every percentage point that the
individual's or employe's family income exceeded 100% of the poverty line.
Upon implementation of the basic plan, medical benefits will no longer be
available under the general relief or relief of needy Indian persons programs,
although agencies administering these programs are required to assist recipients
under these programs in obtaining coverage and a premium subsidy under the basic
plan. In addition, medical assistance benefits for covered persons will be limited to
coverage under the basic plan or, in some cases, payment of medicare premiums,
copayments and deductibles.
For further information see the state fiscal estimate, which will be printed as
an appendix to this bill.
The people of the state of Wisconsin, represented in senate and assembly, do
enact as follows:
AB500, s. 1 1Section 1. 20.145 (9) of the statutes is created to read:
AB500,4,32 20.145 (9) Basic health plan. (c) Premium subsidies. A sum sufficient for the
3premium subsidies under s. 637.27.
AB500,4,64 (i) Recovery of premium subsidies. All moneys received from the recovery,
5under s. 637.30 (2), of premium subsidies, for the payment of premium subsidies
6under s. 637.27.
AB500, s. 2 7Section 2. 20.435 (4) (eb) of the statutes is amended to read:
AB500,4,108 20.435 (4) (eb) General relief aid. The amounts in the schedule for state aid to
9counties for eligible general relief costs as determined under s. 49.035 (4e) (a) and
10(b)
.
AB500, s. 3
1Section 3. 40.51 (8) of the statutes is amended to read:
AB500,5,42 40.51 (8) Every Except as provided in sub. (17), every health care coverage plan
3offered by the state under sub. (6) shall comply with ss. 631.89, 631.90, 631.93 (2),
4632.72 (2), 632.87 (3) to (5), 632.895 (5m) and (8) to (10) and 632.896.
AB500, s. 4 5Section 4. 40.51 (9) of the statutes is amended to read:
AB500,5,86 40.51 (9) Every Except as provided in sub. (17), every health maintenance
7organization and preferred provider plan offered by the state under sub. (6) shall
8comply with s. 632.87 (2m).
AB500, s. 5 9Section 5. 40.51 (15m) of the statutes is amended to read:
AB500,5,1210 40.51 (15m) Every Except as provided in sub. (17), every health care plan,
11except a health maintenance organization or a preferred provider plan, offered by the
12state under sub. (6) shall comply with s. 632.86.
AB500, s. 6 13Section 6. 40.51 (17) of the statutes is created to read:
AB500,5,1714 40.51 (17) If one of the plans offered by the state under sub. (6) is the basic plan
15under ch. 637, that plan is required to comply with only those health insurance
16mandates, as defined in s. 601.423 (1), that the commissioner of insurance
17determines by rule under s. 637.05 (1) apply to the basic plan under ch. 637.
AB500, s. 7 18Section 7. 46.27 (11) (e) of the statutes is created to read:
AB500,5,2319 46.27 (11) (e) Beginning on the first day of the 12th month beginning after the
20date on which the department makes a certification under s. 49.44 (5), the
21department may not provide home and community-based services under this
22subsection to persons eligible for medical assistance under s. 49.46 (1) (a) 1., 1m., 6.
23or 12., (c), (cg), (co), (cr) or (cs) or 49.47 (4) (a) 1. or 2.
AB500, s. 8 24Section 8. 46.275 (6) of the statutes is amended to read:
AB500,6,10
146.275 (6) Effective period. This section takes effect on the date approved by
2the secretary of the U.S. federal department of health and human services as the
3beginning date of the period of waiver received under sub. (2). This section remains
4in effect for 3 years following that date and, if the secretary of the U.S. federal
5department of health and human services approves a waiver extension, shall
6continue an additional 3 years, except that, beginning on the first day of the 12th
7month beginning after the date on which the department makes a certification under
8s. 49.44 (5), the department may not provide services under this section to persons
9eligible for medical assistance under s. 49.46 (1) (a) 1., 1m., 6. or 12., (c), (cg), (co), (cr)
10or (cs) or 49.47 (4) (a) 1. or 2
.
AB500, s. 9 11Section 9. 46.278 (8) of the statutes is amended to read:
AB500,6,2112 46.278 (8) Effective period. Except as provided under sub. (2), this section
13takes effect on the date approved by the secretary of the federal department of health
14and human services as the beginning date of the period of waiver received under sub.
15(3). This section remains in effect for 3 years following that date and, if the secretary
16of the federal department of health and human services approves a waiver extension,
17shall continue an additional 3 years, except that, beginning on the first day of the
1812th month beginning after the date on which the department makes a certification
19under s. 49.44 (5), the department may not provide services under this section to
20persons eligible for medical assistance under s. 49.46 (1) (a) 1., 1m., 6. or 12., (c), (cg),
21(co), (cr) or (cs) or 49.47 (4) (a) 1. or 2
.
AB500, s. 10 22Section 10. 49.002 (2) of the statutes is renumbered 49.002 (2) (a) and
23amended to read:
AB500,7,724 49.002 (2) (a) It Before the first day of the 12th month beginning after the date
25on which the department makes a certification under s. 49.44 (5), it
is the declared

1legislative policy that general relief is the payer of last resort in all cases, except those
2cases involving crime victim awards under s. 949.06, where a dispute may arise over
3payment for costs associated with maintaining the health and welfare of recipients
4of general relief, including disputes concerning health care costs with private or
5public payees of health care costs, other governmental welfare programs,
6rehabilitation programs and programs requiring institutionalization or long-term
7medical and psychiatric treatment.
AB500, s. 11 8Section 11. 49.002 (2) (b) of the statutes is created to read:
AB500,7,149 49.002 (2) (b) Beginning on the first day of the 12th month beginning after the
10date on which the department makes a certification under s. 49.44 (5), it is the
11declared legislative policy that general relief is the payer of last resort in all cases,
12except those cases involving crime victim awards under s. 949.06, where a dispute
13may arise over payment for costs associated with maintaining the welfare of
14recipients of general relief.
AB500, s. 12 15Section 12. 49.01 (5m) of the statutes is renumbered 49.01 (5m) (a) and
16amended to read:
AB500,8,417 49.01 (5m) (a) "General Before the first day of the 12th month beginning after
18the date on which the department makes a certification under s. 49.44 (5), "general

19relief" means such services, commodities or money moneys as are reasonable and
20necessary under the circumstances to provide food, housing, clothing, fuel, light,
21water, medicine, medical, dental, and surgical treatment (including hospital care),
22optometrical services, nursing, transportation, and funeral expenses, and include
23includes wages for work relief. The food furnished shall be of a kind and quantity
24sufficient to provide a nourishing diet. The housing provided shall be adequate for
25health and decency. Where there are children of school age the general relief

1furnished shall include necessities for which no other provision is made by law. The
2general relief furnished, whether by money or otherwise, shall be at such times and
3in such amounts, as will in the discretion of the general relief official or agency meet
4the needs of the recipient and protect the public.
AB500, s. 13 5Section 13. 49.01 (5m) (b) of the statutes is created to read:
AB500,8,166 49.01 (5m) (b) Beginning on the first day of the 12th month beginning after the
7date on which the department makes a certification under s. 49.44 (5), "general
8relief" means such services, commodities or moneys as are reasonable and necessary
9under the circumstances to provide food, housing, clothing, fuel, light, water,
10transportation, and funeral expenses, and includes wages for work relief. The food
11furnished shall be of a kind and quantity sufficient to provide a nourishing diet. The
12housing provided shall be adequate for health and decency. Where there are children
13of school age the general relief furnished shall include necessities for which no other
14provision is made by law. The general relief furnished, whether by money or
15otherwise, shall be at such times and in such amounts, as will in the discretion of the
16general relief official or agency meet the needs of the recipient and protect the public.
AB500, s. 14 17Section 14. 49.015 (3) of the statutes is amended to read:
AB500,8,2518 49.015 (3) After December 31, 1986, a A general relief agency may waive the
19requirement under sub. (1) (b) or (2) (a) in a medical emergency or in case of unusual
20misfortune or hardship. Before the first day of the 12th month beginning after the
21date on which the department makes a certification under s. 49.44 (5), a general
22relief agency may also waive the requirement under sub. (1) (b) or (2) (a) in a medical
23emergency.
Each waiver shall be reported to the department. The department may
24deny reimbursement under s. 49.035 for any case in which a waiver is
25inappropriately granted.
AB500, s. 15
1Section 15. 49.02 (5m) of the statutes is created to read:
AB500,9,62 49.02 (5m) Beginning on the first day of the 12th month beginning after the
3date on which the department makes a certification under s. 49.44 (5), the general
4relief agency shall assist general relief recipients in applying for health care coverage
5under the basic plan under s. 637.05 and in applying for a premium subsidy under
6s. 637.27.
AB500, s. 16 7Section 16. 49.02 (20) of the statutes is created to read:
AB500,9,108 49.02 (20) Subsections (5), (6c), (6g), (6r), (8), (9) and (10) do not apply
9beginning on the first day of the 12th month beginning after the date on which the
10department makes a certification under s. 49.44 (5).
AB500, s. 17 11Section 17. 49.032 (4r) of the statutes is amended to read:
AB500,9,1612 49.032 (4r) If a general relief agency provides a monthly general relief benefit
13to an eligible dependent person which exceeds the monthly benefit amount required
14under sub. (1) (c), the department shall reimburse the general relief agency at the
15rate set forth under s. 49.035 (1) (d), from the appropriation under s. 20.435 (4) (eb),
16for the amount paid to the eligible dependent person.
AB500, s. 18 17Section 18. 49.035 (1) (intro.) and (d) of the statutes are consolidated,
18renumbered 49.035 (1) and amended to read:
AB500,9,2119 49.035 (1) As provided in sub. (4e), the department shall reimburse, except for
20medical costs: (d) A, a county for up to 37.5% of the eligible costs paid by the general
21relief agency for general relief provided under s. 49.02.
AB500, s. 19 22Section 19. 49.035 (2) (b) 7. and 8. of the statutes are amended to read:
AB500,9,2423 49.035 (2) (b) 7. Up to 40% of eligible medical costs that are incurred by the
24county before the first day of the 12th month beginning after the date on which the

1department makes a certification under s. 49.44 (5), that are incurred
on behalf of
2an individual client and that are not more than $10,000 per claim period.
AB500,10,63 8. Up to 70% of eligible medical costs that are incurred by the county before the
4first day of the 12th month beginning after the date on which the department makes
5a certification under s. 49.44 (5), that are incurred
on behalf of an individual client
6and that exceed $10,000 per claim period.
AB500, s. 20 7Section 20. 49.035 (2) (cm) (intro.) of the statutes is amended to read:
AB500,10,128 49.035 (2) (cm) (intro.) A county for up to 60% of the eligible medical costs that
9are incurred before the first day of the 12th month beginning after the date on which
10the department makes a certification under s. 49.44 (5)
for individual clients who are
11enrolled in a prepaid health care system with a uniform fee per person, if the
12following requirements are met:
AB500, s. 21 13Section 21. 49.035 (4e) (a) and (b) of the statutes are amended to read:
AB500,10,2114 49.035 (4e) (a) If claims for reimbursement of eligible general relief costs at the
15maximum rates under subs. (1) and (2) do not exceed the total of the funds available
16under s. 20.435 (4) (eb) and the payments to county hospitals and county mental
17health complexes under par. (c) for that fiscal year, the department shall determine
18the amount of a county's reimbursement from the appropriation under s. 20.435 (4)
19(eb) by applying the maximum rates under subs. (1) and (2) to the county's eligible
20costs and subtracting the amount paid to county hospitals and county mental health
21complexes in the county under par. (c).
AB500,11,522 (b) If claims for reimbursement of eligible general relief costs at the maximum
23rates under subs. (1) and (2) do exceed the total of the funds available under s. 20.435
24(4) (eb) and the payments to county hospitals and county mental health complexes
25under par. (c) for that fiscal year, the department shall prorate the funds available

1under s. 20.435 (4) (eb) among the counties. Under this paragraph, the department
2shall determine the amount of a county's reimbursement from the appropriation
3under s. 20.435 (4) (eb) by subtracting the amount paid to county hospitals and
4county mental health complexes in the county under par. (c) from its prorated share
5of the funds available under s. 20.435 (4) (eb).
AB500, s. 22 6Section 22. 49.035 (4e) (d) of the statutes is created to read:
AB500,11,107 49.035 (4e) (d) This subsection does not apply with respect to claims for
8reimbursement of eligible general relief costs that were incurred on or after the first
9day of the 12th month beginning after the date on which the department makes a
10certification under s. 49.44 (5).
AB500, s. 23 11Section 23. 49.035 (6) (am) and (b) of the statutes are amended to read:
AB500,11,1512 49.035 (6) (am) Requires Before the first day of the 12th month beginning after
13the date on which the department makes a certification under s. 49.44 (5), requires

14prior authorization or health care provider certification for a specified period of time
15by the general relief agency for all nonemergency medical care that is provided.
AB500,11,2316 (b) Develops Before the first day of the 12th month beginning after the date on
17which the department makes a certification under s. 49.44 (5), develops
and files
18with the department on or before October 1 of each year a medical cost containment
19plan for the subsequent calendar year. The plan shall include provisions limiting the
20inappropriate use of emergency room care and controlling payments to providers and
21may include provisions on supplying case management services. The department
22shall approve or disapprove the plan within a reasonable period of time after the plan
23is timely filed.
AB500, s. 24 24Section 24. 49.043 of the statutes is renumbered 49.043 (1) and amended to
25read:
AB500,12,4
149.043 (1) Any Except as provided in sub. (2), any municipality or county may
2purchase health or dental insurance for unemployed persons residing in the
3municipality or county who are not eligible for medical assistance under s. 49.46,
449.468 or 49.47.
AB500, s. 25 5Section 25. 49.043 (2) of the statutes is created to read:
AB500,12,86 49.043 (2) This section does not apply on or after the first day of the 12th month
7beginning after the date on which the department makes a certification under s.
849.44 (5).
AB500, s. 26 9Section 26. 49.046 (3) (b) 1. to 3. of the statutes are consolidated, renumbered
1049.046 (3) (b) 1 and amended to read:
AB500,12,1411 49.046 (3) (b) 1. Payments Except as provided in subd. 2., payments for medical
12care may be made for any benefit authorized under s. 49.46 (2). 2. Payments and
13shall be equal to the rates established under s. 49.45. 3. Recipients of aid for medical
14care are subject to the copayment provisions established under s. 49.45 (18).
AB500, s. 27 15Section 27. 49.046 (3) (b) 2. of the statutes is created to read:
AB500,12,1816 49.046 (3) (b) 2. This paragraph does not apply with respect to payments for
17medical care incurred on or after the first day of the 12th month beginning after the
18date on which the department makes a certification under s. 49.44 (5).
AB500, s. 28 19Section 28. 49.046 (4) (bm) of the statutes is created to read:
AB500,12,2420 49.046 (4) (bm) Beginning on the first day of the 12th month beginning after
21the date on which the department makes a certification under s. 49.44 (5), the
22administering agency shall assist recipients of aid under this section in applying for
23health care coverage under the basic plan under s. 637.05 and in applying for a
24premium subsidy under s. 637.27.
AB500, s. 29
1Section 29. 49.06 (3) of the statutes is renumbered 49.06 (3) (a) and amended
2to read:
AB500,13,73 49.06 (3) (a) A Except as provided in par. (b), a general relief agency may adopt
4written criteria to deny eligibility for general relief medical benefits to a person who,
5in contemplation of becoming eligible to receive general relief benefits, disposes of
6his or her assets for significantly less than full value during the 90 days immediately
7before the person applies for general relief medical benefits.
AB500, s. 30 8Section 30. 49.06 (3) (b) of the statutes is created to read:
AB500,13,119 49.06 (3) (b) This subsection does not apply after the first day of the 12th month
10beginning after the date on which the department makes a certification under s.
1149.44 (5).
AB500, s. 31 12Section 31. 49.43 (8) of the statutes is amended to read:
AB500,13,1913 49.43 (8) "Medical assistance" means any services or items under ss. 49.45 to
1449.47 and 49.49 to 49.497, or any payment or reimbursement made for such services
15or items, and, beginning on the first day of the 12th month beginning after the date
16on which the department makes a determination under s. 49.44 (5), coverage under
17the basic plan under s. 637.05 provided to persons eligible for medical assistance
18under s. 49.46 (1) (a) 1., 1m., 6. or 12., (c), (cg), (co), (cr) or (cs) or 49.47 (4) (a) 1. or
192
.
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