Insulating between floor joists

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I live in Minnesota, so a northern climate. I want to expose the ceiling in my basement and paint the ceiling joists and associated ductwork, electrical, etc. There is currently an early 1980's suspended ceiling that I want to eliminate to make it feel like there is more headroom in the basement.

The walls are concrete block and are furred out and covered with drywall. Currently there are pieces of batt insulation cut and stuffed into the space between the joists on the outside wall. How can I insulate or cover this area if I am going to spray paint the floor joists? It doesn't seem like simply spraying the insulation with paint will look very good.

Any ideas?
 

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