Milwaukee County stops taking fathers to court to pay back Medicaid for childbirth costs

Milwaukee County is on the verge of ending the practice of demanding that unwed fathers pay back the Medicaid program for the cost of covering the birth of their children.

Dane County, which in 2020 stopped going to court to claw back those Medicaid dollars from fathers, is poised to drop pending cases that remain open from before that year.

Both developments are an advance for equity on behalf of newborns and their parents living in poverty, advocates say.

Birth-cost recovery is the term for suing the fathers of children born to single mothers whose birth costs were covered by Medicaid (also known as BadgerCare in Wisconsin). Although the practice has been defended as a form of child support enforcement, critics say that description is misleading.

“The Birth Tax is NOT child support, as none of the money collected supports the direct care or protection of the child,” according to a December 2022 report from ABC for Health. The Madison-based nonprofit is a health care advocacy organization for low- and moderate-income Wisconsin residents, including those grappling with medical debt.

“It is instead put toward federal and county government budgets,” the report states. “The policy diverts resources and money that could otherwise go to the baby and custodial parent to the state, and the counties keep at least 15% of what they collect as a bounty payment.”

The practice has had a disproportionate impact on Black and other non-white ethnic and racial groups, says Bobby Peterson, executive director of ABC for Health.

Prof. Tiffany Green, a health care economist at the University of Wisconsin-Madison who has researched the impact of birth- cost recovery programs, said a study she conducted pointed to better child support payments when birth-cost recovery (BCR) stopped.

“With the caveat that our results of preliminary, we found that BCR cessation was linked to increased probability of paying support to birthing parents (i.e., mothers and other individuals who gave birth), and that the amount of that support increased,” Green told the Wisconsin Examiner Monday. That pattern appeared “particularly pronounced among the fathers of Black children,” although not among fathers of white children. Future research will explore possible explanations for those differences, she added.

Dane County stopped filing new birth-cost recovery actions in its 2020 budget, but the December 2022 ABC for Health report found that the county had continued to pursue and collect on judgments from 2019 and before.

The Dane County budget, which County Executive Joe Parisi signed without vetoes after it passed the county board Monday, Nov. 6, includes language stating the county will ask the state to “release all birth cost recovery judgments entered in Dane County Circuit Court.”

The Milwaukee County budget, which passed the Milwaukee County board Thursday, Nov. 9, also includes a provision to discontinue seeking birth- cost recovery. Supervisor Caroline Gómez -Tom advocated the amendment and Milwaukee County Executive David Crowley supported it. Milwaukee County officials said the county cannot end existing court orders, however.

“There are glaring racial disparities in the Birth Cost Recovery system. To achieve race and health equity and become the healthiest county in the state, it’s critical Milwaukee County discontinues this practice,” Crowley said in a statement issued jointly with Gómez -Tom immediately after the budget passed.

Ending Medicaid birth-cost recovery has been a longstanding goal of ABC for Health, which calls the practice “the birth tax,” Peterson said. While the practice was most pronounced in the state’s two largest-population counties, the organization is now turning its attention to other counties where it continues, he added.