Self-insuring state workers carries many uncertainties

CAPITOL NEWSLETTER
Matt Pommer • Wisconsin Newspaper Association

Wisconsin’s health industry groups want Gov. Scott Walker to think twice about moving to selfinsurance for the 250,000 state workers and their families.

Consultants have said the move, which could occur in 2018, might save $42 million or end up costing an additional $100 million. The potential savings include $18 million in fees under Obamacare.

But Donald Trump’s surprise victory on Nov. 8 seems to have changed the picture. Trump campaigned with a promise to repeal Obamacare on the first day he is president.

That won’t occur on Jan. 20 and perhaps not for many months. The country needs to know what will follow. Remember the Republican campaign rhetoric called for “repeal and replacement.”

The questions involved in replacement are the same ones faced by Obamacare – how to get healthy people to buy health insurance and how it will be financed.

One possible approach is to dump the problems into the laps of the 50 governors and the 50 legislatures. It’s an idea that is supported by Gov. Scott Walker who now is in a leadership role with the Republican Governors Association.

Obamacare provides large chunks of money to expand Medicaid, the program for poor adults, many of whom who have outlived their resources. Wisconsin opted not to fully expand Medicaid under Obamacare. Walker said the federal budget couldn’t afford the expanded program.

All of the states, regardless of their Medicaid decisions, will want to maximize their aid. Cutting programs or raising their own funds might be looming on the horizon.

Those are different concerns than those raised by the State Hospital Association, the State Medical Society and other providers. Currently state workers can choose among the 17 health maintenance organizations for their care. Many of the HMOs are part of larger medical groups such as hospitals.

Competition is the keystone of the current state employee health program. It dates to the 1980s, and supporters say it has helped keep costs down. Walker has talked about going to self-insurance for several years.

He seems confident of lowering costs, pledging that any savings would be used to help public schools. Those urging caution say a change could impact both the state health care and health insurance markets.

Among other groups urging caution by Walker are those representing chiropractors, psychiatrists, radiologists, ophthalmologists, and emergency room physicians. Also signing the memo were the Counties Association and the Rural Wisconsin Cooperative.

There are a lot of Republican folks in those organizations. The issue was scheduled to go to the Group Insurance Board for a recommendation at the end of November.


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