Health care trajectory in wisconsin positive amid systemic changes

Economic Trends 2016


In health care, particularly in Wisconsin, it’s impossible to look ahead to 2016 without recounting high points of 2015:

  • The UW Extension reported that patients traveling to Wisconsin for our high-quality health care added $3 billion to the state’s economy and supported some 6,400 jobs here.
  • A study by the University of Wisconsin-Whitewater tabbed Wisconsin as having the third-most efficient health care system in the country, delivering a strong ROI for employers’ health care dollars.
  • The respected National Committee for Quality Assurance gave seven Wisconsin-based, provider-owned health insurance plans its highest ratings, making Wisconsin one of NCQA’s top-performing states.
  • The highly regarded Agency for Healthcare Research and Quality ranked Wisconsin as having the second-highest quality health care in the nation.

Wisconsin has been at or near the top of the AHRQ rankings since 2005.


Bottom line: Wisconsin’s hospitals and health systems remain on a positive trajectory and are well-positioned for the systemic changes gripping the health care system.


Looking ahead, 2016 will see continuing evolution in how health care is paid for and, as a result, how health care is delivered. The latest example begins this April when Medicare starts paying larger hospitals a single “all-in’’ fee for a knee or hip replacement. Known as a “bundled payment,” it means being paid once for an entire “episode” of care rather than each time a service within that episode is rendered. Further, the final bundle amount will be adjusted for the quality of care given – better outcome means higher payment, and vice versa. In other words, hospitals are bearing more of the risk (and reward) that has typically been the realm of insurance companies. Shifting risk and moving payment from volume to value is driving greater efficiency, better outcomes and massive reconfiguration of how health care systems are structured, aligned, resourced and staffed. Given Wisconsin’s longstanding commitment to high-quality outcomes and high-value care (see previous), these are reforms Wisconsin can leverage to our advantage.

2016 also marks the third year of Obamacare and, by most measures, insurance coverage has expanded across the country since its inception. In Wisconsin, there’s been an estimated 19 to 32 percent reduction in the number of uninsured, including some 180,000 people obtaining insurance on the exchange. While this is positive, there are problems on the horizon. Nearly 90 percent of those with exchange coverage in Wisconsin receive a large (and costly) federal subsidy that pays most of their premiums (insurance companies also receive a subsidy to keep premiums lower). Costs are adding up fast, and at the same time, some large insurance companies are threatening to pull out of the exchanges. These developments may boost efforts to repeal and replace Obamacare, but unwinding what is rapidly becoming a new entitlement will be easier said than done, and carries with it massive implications for employers, insurance companies, health care providers and taxpayers… all in an election year.

There are potent forces converging to rapidly redraw the health care landscape, and no one can be sure what the next 12 months will bring. But of one thing we can be certain – health care is one of Wisconsin’s greatest assets. High-quality, high-value health care has become synonymous with Wisconsin and is one of the reasons we are on solid ground as health care changes around us.

-Eric Borgerding is president and chief executive officer of the Wisconsin Hospital Association.

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