Wisconsin insurance board mulls move to self-insurance

Consulting firm says that skipping health insurers could lead to millions of dollars in savings

Insurance News

By Allie Sanchez

Wisconsin is considering shifting to self-insurance to provide health care for some 250,000 state employees.

A report by local media explained that under self-insurance, the state would pay benefits directly to the Department of Employee Trust Funds instead of paying a fixed premium to health insurance companies. Under the scheme, the trust fund will have greater control over how the funds are invested and disbursed, with the potential to improve member care and service quality.

Further, The Daily Cardinal said that Segal Consulting has told the state Group Insurance Board that trimming down the current 18 health insurance plans to just one or two could save Wisconsin $42 million annually. The report also said that Governor Scott Walker has earmarked the potential savings for public education.

However, Jack O’Meara, head lobbyist for the Public Representation Organization of the Faculty Senate, said that his organization, which lobbies on behalf of University of Wisconsin-Madison faculty, will most likely block any move towards self-insurance.

O’Meara added that instead of squirreling away more savings as a result of self-insurance, the government is more likely to lose around $18 million.

Gov. Walker’s administration has been exploring self-insurance as far back as 2013; however, his government has yet to take concrete steps to adopt it. Segal Consultants is encouraging insurers to conduct market research that would expedite the transition to self-insurance, targeting a 2018 deadline.

 

Related stories:
New Mexico auditor wants re-examination of health insurer’s tax filings
Iowa holds back on state employee health benefits

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