State News

UW-Madison staff uncertain on move to self-insurance

Wisconsin’s Group Insurance Board met Wednesday to discuss potentially controversial changes to how the government provides health care to its 250,000 employees.

Image By: Katie Scheidt

Wisconsin’s Group Insurance Board met Wednesday to discuss the future of self-insurance in the state, in a potentially controversial move to change how the government provides health care to its 250,000 employees.

Many UW faculty are questioning what this means for them. Self-insurance does not affect how employees pay for insurance. Instead, the state would pay the benefits directly to the Department of Employee Trust Funds rather than paying health insurance companies a fixed premium. The ETF then has more control of how funds are spent and could potentially improve member care and quality of services.

A private firm, Segal Consulting, told the Group Insurance Board that cutting the current 18 health insurance plans to just one or two plans would save $42 million a year. Gov. Scott Walker said in his State of the State speech last year that all savings will go toward public education.

Jack O’Meara, head lobbyist for the Public Representation Organization of the Faculty Senate, said faculty are “concerned about the proposal.” He said that while his organization, which lobbies on behalf of UW-Madison faculty, does not currently have a position on the issue, they will likely oppose any move to self-insurance.

O’Meara said he was especially concerned about self-insurance if President-elect Donald Trump repeals Obamacare.

“It is likely they will lose the $18 million dollars in savings under the AFA that the consultants claim they will gain,” O’Meara said.

Although Walker’s administration has discussed self-insurance since 2013, little action has been taken. Segal Consultants are pushing for insurers to collect data that would assist the transition to self-insurance as soon as 2018.

Wisconsin currently has the most competitive health care market in the country. Members of the state’s Group Insurance Board are pushing for another meeting in February to approve self-insurance.

At a meeting last November, Dan Schwartzer, then Wisconsin’s deputy insurance commissioner, said the state should not rush the decision.

“I just think we’re cutting way too short this discussion,” Schwartzer said  at the time.

Many state employers share Schwartzer’s concern and feel disconnected from the decision.

“They are considering blowing up the health care system for state employees without bothering to involve any front-line employees in the discussion,” Rick Badger, executive director of the American Federation of State, County and Municipal Employees, told the Wisconsin State Journal.

Update 12/1/16 1:24 p.m.:   This article has been updated to clarify that Dan Schwartzer's quote was from November 2015. Schwartzer is no longer the state's deputy insurance commissioner. 

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