After years of fighting Obamacare, Gov. Scott Walker is now seeking to stabilize the state marketplace under the law.
Wisconsin plans to seek federal permission to cover expensive medical claims for health insurers on the marketplace, which should lower premium increases and could bring back companies that dropped out, the governor said in an interview with reporters on Friday ahead of his election-year State of the State address Wednesday.
The state will also ask to permanently continue SeniorCare, a prescription drug program Walker has previously sought to pare down, he said.
Walker also said he’ll ask the state Senate to pass a bill authored by Democratic lawmakers and passed by the Assembly that would enshrine into state law access to private insurance for people with pre-existing conditions.
In the most significant of his health care proposals, Walker will ask the Legislature to join a few other states in adopting a reinsurance program to prop up the individual market, which is used by some 216,000 residents, in a state innovation waiver allowed under the Affordable Care Act, or Obamacare.
“Health insurance — the biggest thing I hear from people across the state when I’m in listening sessions and sit-downs and discussions, is stability — that’s the biggest thing people are concerned about,” Walker said.
Walker’s proposals aimed at stabilizing the state Obamacare marketplace is the latest plan he has put forward that reflects long-held priorities of Democrats, who begrudgingly said they would likely support the health care plan but called his recent proposals insincere and aimed at winning re-election in November.
Last year, Walker proposed an increase in funding for K-12 schools in the current state budget that surpassed what state Superintendent Tony Evers, a Democrat, proposed and came after years of education cuts and frozen funding. And earlier this month, Walker called for closing the state’s troubled youth prison after years of unanswered calls to do so from Democrats amid allegations of widespread abuse of inmates and staff assaults.
“I don’t know the governor deserves credit for trying to put out a fire that he started,” said Assembly Minority Leader Gordon Hintz, D-Oshkosh. “Give me a break on this pivot.”
Senate Minority Leader Jennifer Shilling, D-La Crosse, called Walker’s plan “a total flip-flop from legislative Republicans, who have repeatedly voted against improving access to affordable health care over the years.”
But Walker said his proposals on education, corrections and now health care are a reflection of listening to voters in recent months.
“I don’t think those are Democratic issues — those are Wisconsin issues,” he said.
Premium hikes would be curbed
By paying 80 percent of claims between $50,000 and $250,000, the proposed reinsurance program, to start in 2019, would significantly reduce premium increases for people on the Obamacare marketplace, Walker said.
The premiums went up an average of 36 percent this year, compared with less than 5 percent for people who get insurance through employers, he said. For the vast majority of people on Obamacare, federal subsidies mask the premium increases.
The state needs to act because Congress hasn’t repealed Obamacare, Walker said.
“Their failure to act on this issue is yet another call for us to step up and lead,” he said. “I wanted to get premiums for that individual market more compatible with where the group insurance premiums are.”
The program would cost about $200 million a year — $150 million in federal money and $50 million from the state, which would come from Medicaid savings, not the general budget, Walker said.
The federal government has let Alaska, Minnesota and Oregon set up similar programs. Other states have applied for or are expected to seek waivers, which became available under Obamacare last year. They allow for alternative models of providing health insurance, as long as the coverage is as comprehensive and affordable as other plans, and covers as many people.
Wisconsin plans to seek other changes through a waiver beginning in 2020, Walker said. J.P. Wieske, deputy commissioner of insurance, has said such changes could include health savings accounts or the return of a high-risk pool.
Molina Healthcare, Anthem Blue Cross Blue Shield in Wisconsin and Health Tradition Health Plan left Wisconsin’s marketplace this year, requiring about 75,000 people to select other insurance, Wieske said.
“Some of the insurers who have left the market have mentioned (the reinsurance program) specifically as something that they’re interested in,” Wieske said.
Tim Lundquist, director of government and public affairs for the Wisconsin Association of Health Plans, said the state should consider the innovation waiver to help maintain the state’s competitive health insurance market.
Donna Friedsam, health policy programs director for the UW Population Health Institute, said Minnesota’s reinsurance program has reduced premium increases in that state.
“It has been very helpful in helping to stabilize those prices, and could be very helpful here,” Friedsam said.
About 92,000 elderly residents have SeniorCare, which costs $30 a year plus deductibles, co-pays and other expenses depending on income level.
In recent years, Walker has proposed making people on the program enroll in Medicare Part D, which this year costs an average of $43 a month. The federal plan would have become their primary drug coverage, with SeniorCare covering gaps.
The proposals failed amid bipartisan opposition. Walker said he will now seek permanent approval for the program instead of having to ask every few years to let it continue.
Robin Rudowitz, a Medicaid expert with the Kaiser Family Foundation, said she’s never heard of a state getting a permanent waiver for any Medicaid program, and doesn’t believe it’s possible. But President Donald Trump’s administration recently approved a 10-year waiver for a program in Mississippi, longer than the regular waiver periods of three or five years, Rudowitz said.
Under Obamacare, insurers must cover people with pre-existing conditions. But Wisconsin should codify the requirement into state law so people with illnesses can have stable insurance, Walker said.
Sen. Jon Erpenbach, D-Middleton, who authored the legislation protecting pre-existing conditions that Walker is pushing the state Senate to approve, said that if Walker was being sincere he would also be talking about accepting federal money to expand Medicaid in order to ensure funding of the proposed program. Walker has turned down $690 million in such funding since 2014. Erpenbach said the $200 million cost Walker proposed is unrealistic.
A recent analysis from the nonpartisan Legislative Fiscal Bureau requested by Erpenbach shows the state would have saved about $200 million this fiscal year if the state had accepted the federal funding.
Erpenbach also said the governor was misleading the elderly on protecting the SeniorCare program permanently because it would likely take an act of Congress to do so.
“The governor has done some polling and he’s found himself on the wrong side of history on the issue of health care,” Erpenbach said.
Assembly Speaker Robin Vos, R-Rochester, said he’s supportive of Walker’s plan.
“It’s not the responsibility of the states to clean up the mess from the failed experiment known as ObamaCare,” Vos said in a statement. “However, I’m glad that Governor Walker is stepping up to find a work around.”