Increased funding will bolster workforce delivering care to older adults and people with disabilities

MADISON — Gov. Tony Evers on Aug 1st, announced he is directing the Wisconsin Department of Health Services (DHS) to invest $258 million in funding already designated for home and community-based services (HCBS) to create and fund a minimum fee schedule, effectively raising wages for direct care workers and providers serving older adults and individuals with disabilities. With Gov. Evers’ action today, Wisconsin will join 20 other states that have a minimum fee schedule for HCBS providers, including neighboring Midwest states of Illinois, Iowa, Minnesota, and Michigan.

The minimum fee schedule will establish minimum amounts managed care organizations (MCOs) must pay providers for certain adult long-term care services. According to DHS, the affected Medicaid programs include Family Care, Family Care Partnership, and Program of All-Inclusive Care for the Elderly (PACE), and these programs serve nearly 57,000 older adults and adults with disabilities. DHS estimates this funding and the creation of the minimum fee schedule, together, will provide a 15 percent rate increase for most supportive home care services and a 40.5 percent rate increase for most of the services provided at residential facilities, among other rate increases.

“I declared 2024 the Year of the Worker in Wisconsin to continue focusing on our efforts to address our state's generational workforce challenges, chief among them efforts to bolster our healthcare and direct care workforces,” said Gov. Evers. “Our healthcare workers have faced significant challenges these past few years, and these investments will go a long way toward helping make sure workers receive the support and fair compensation they deserve. While this is an important step in helping us be able to recruit, train, and retain talented folks in our healthcare workforce, it’s going to be critical for these investments to continue in our next biennial budget so we can address chronic challenges and continue building a strong, stable healthcare industry for the future.”

“This is the right thing to do for Wisconsin’s long-term care system and the providers who care for our state’s most vulnerable,” said DHS Secretary Kirsten Johnson. “It’s a critical investment, making for a stronger workforce able to offer quality care and services, and ensuring people are able to stay in their homes and communities longer.”

The minimum fee schedule is a list of the lowest prices MCOs would be allowed to pay for services. By establishing the minimum fee schedule, Gov. Evers is ensuring the department can require MCOs to pass along rate increases to providers, ensuring stability and consistency in terms of revenue and expenditures for providers and MCOs alike. Gov. Evers first proposed creating a minimum fee schedule for certain long-term care services in his 2023-25 biennial budget, but Republican lawmakers who comprise a supermajority of the Joint Committee on Finance stripped this provision from the final budget. While the Wisconsin State Legislature and Gov. Evers have approved long-term care rate increases in the past, those increases have not come with a requirement as to the minimum amount to be passed along to providers.  

The HCBS minimum fee schedule will direct $258 million from DHS’ allocation of American Rescue Plan Act (ARPA) funds designated specifically for HCBS programs and services. DHS estimates $350 million is available in ARPA HCBS funding to strengthen the state’s HCBS programs, address direct care workforce issues, and develop strategies to delay the need for long-term care. The minimum fee schedule applies to services for which no specific rates exist in fee-for-service Medicaid, and consequently, each MCO establishes a rate through its contract with the provider. These services include: