Gov. Scott Walker has asked for a federal waiver to operate a state-based reinsurance plan designed to stabilize the state’s individual health insurance market and hold down premiums under the Affordable Care Act.
Following a 44 percent average spike in Obamacare premiums this year, Walker’s office estimates the $200 million program would lower premiums by 11 percent from what they otherwise would have been, amounting to a 5 percent decrease in premiums compared to 2018.
Under the plan, the state would pay $34 million for reinsurance in 2019, while $166 million would come from federal funds.
The plan to prop up the health care law comes as action has seemingly stalled at the federal level, Walker said.
The move also follows a lawsuit filed earlier this year by state Attorney General Brad Schimel and Texas Attorney General Ken Paxton challenging the constitutionality of the ACA.
“We are taking action to address the challenges created by Obamacare and bring stability to the individual market,” Walker said. “Our Health Care Stability Plan provides a Wisconsin-based solution to help stabilize rising premiums in order to make health care more affordable for those purchasing in the individual market. With Washington D.C. failing to fix our nation’s health care system, Wisconsin must lead.”
The reinsurance program would pay insurers about 50 percent of claim costs between $50,000 and $250,000.
In recent years, several large health plans have dropped coverage in Wisconsin’s individual market or reduced their service areas. This year, 75,000 residents were forced to find new health plans because of insurers exiting the exchange.
Premiums went up an average of 44 percent this year, from an average of $520 to $751 a month. However, government subsidies offset the increases for many consumers.
Premiums are expected to drop to $711 next year under Walker’s plan.
Insurers currently on the exchange in Milwaukee County are Network Health Plan, Common Ground Healthcare Cooperative and Children’s Community Health Plan.