Gov. Scott Walker’s plan to switch to a self-insurance model for state workers’ medical care has little support in the state Legislature, top Republicans said Thursday.
Assembly Majority Leader Jim Steineke said at a UW-Madison faculty forum that he hasn’t found any lawmakers who are excited about the plan, The Associated Press reported.
The Joint Finance Committee, which must approve the proposal, likely will erase it from Walker’s state budget, Steineke said.
Lawmakers are worried the plan won’t generate $60 million in savings over the next two years, as Walker has promised, Steineke said.
Assembly Speaker Robin Vos agreed “there is skepticism regarding the projected savings” and “you would have trouble finding lawmakers who are excited about the proposal,” his spokeswoman, Kit Beyer, told the Wisconsin State Journal.
Sen. Alberta Darling, co-chair of the budget committee, “has some questions about the proposal,” such as “where the savings come from” and how the proposal “impacts both state employees and the private sector,” her spokesman, Bob Delaporte, said.
Rep. John Nygren, the committee’s other co-chair, didn’t respond to a request for comment. Nygren and Darling have previously expressed concerns about moving to self-insurance.
Despite the pushback from Walker’s fellow Republicans who control the Legislature, the governor reiterated his support for self-insurance. Under the plan, the state would contract with six health insurance companies to pay medical claims for 250,000 workers and family members directly — and take on the financial risk for large claims — instead of paying premiums to 17 HMOs, which currently accept the risk.
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“The governor believes it would be unwise for the Legislature to throw away $60 million,” Walker spokesman Tom Evenson said. “We spent almost a year looking at this, and we think there’s a convincing case to provide $60 million in savings that in turn, can be put into public education.”
Consultants hired by the state have said the move could save $40 million a year or cost $100 million. The Group Insurance Board, which oversees the benefits, approved Walker’s proposal last month, saying it would save at least $60 million over two years.
The state Department of Employee Trust Funds, which administers the benefits, continues to negotiate contracts with the health insurance companies and plans to submit contracts to the budget committee for approval, spokesman Mark Lamkins said. ETF staff have said they could make other changes, including using fewer health plans, if the committee doesn’t approve self-insurance.
The proposal is expected to go before the budget committee later this month or next month.
Judith Burstyn, a UW-Madison chemistry professor and president of PROFS, which held the forum Thursday, had a mixed reaction to the idea that self-insurance might not be approved. Pay raises for university employees are tied to the $60 million in savings from self-insurance in Walker’s budget, she said.
“From the perspective of the health insurance part, I’m somewhat relieved,” Burstyn said. “But it raises the question of what’s going to happen to the pay plan if we don’t go to self-insurance and we don’t save that money?”
State Journal reporter Matthew DeFour contributed to this report.