CMS approved a $200 million state reinsurance plan for Wisconsin, sought by Republican Governor Scott Walker as a way to keep premiums down in the state’s individual market.
CMS approved a $200 million state reinsurance plan for Wisconsin, sought by Republican Governor Scott Walker as a way to keep premiums down in the state’s individual market. Walker, who is up for reelection, said his Health Care Stability Plan would lower 2019 premiums on a weighted average by 3.5% from 2018 and by an estimated 11% without the waiver.
Walker said not everyone would see a decrease, but it is better that the 44% increase people saw in premiums last year, he said.
Based on the actuarial report completed by the state, Wisconsin estimates it will pay $34 million for reinsurance in 2019 under the program. The federal government will pay the remaining $166 million in “pass through” funds representing federal savings from the program, Walker’s office said in a statement.
The program will provide coverage for claims between $50,000 and $250,000. The Wisconsin Health Care Stability Plan will pay 50% of those costs up to $200 million. The plan is aimed at people who buy insurance through the Affordable Care Act (ACA) but make too much money to qualify for federal subsidies.
Wisconsin pursued the change through the CMS Section 1332 state innovation waiver process. Waivers are approved for 5 years and cannot add to the federal deficit.
Walker, an opponent of the ACA, is up for reelection, and Democrats in the state said the reinsurance plan is an election-year ploy that will not do as much as expanding the state’s Medicaid program would.
Politico reported earlier in the year that the reinsurance plan is a key piece of his strategy to win reelection. The report said Walker previously used the waiver process to shift thousands of people from the state's Medicaid program to the ACS exchanges, where they qualify for heavily subsidized premiums.
About 225,000 people enrolled in ACA health plans during the last enrollment period, Politico said.
Alaska, Hawaii, Minnesota, and Oregon also have waivers approved by CMS for state reinsurance programs.
The Wisconsin Hospital Association approved of the state’s stability plan, but cautioned that hospitals are experiencing losses from the state’s Medicaid program. In a statement, the association said "recouping these losses adds more than $1 billion annually to the cost of health care and health insurance in Wisconsin.”