Reinsurance explained: Walker's plan to lower health care costs in WisconsinSubmitted: 02/20/2018
Ben Meyer
Ben Meyer
Managing Editor / Senior Reporter

Reinsurance explained: Walker's plan to lower health care costs in Wisconsin
WAUSAU - Gov. Scott Walker sees health insurance premiums going up and insurers leaving Wisconsin's Obamacare marketplaces.

He has a plan he says will help fix both problems.

After touring the new cardiac intensive care unit at Aspirus Wausau Hospital on Tuesday, Walker promoted his plan.

"In my mind, Washington has failed [on health care]. Wisconsin is going to lead," he said.

Part of Walker's plan calls for using $50 million in state money and $150 million in federal money to make Obamacare plans more affordable through a concept called reinsurance.

Reinsurance money would help protect insurance companies from huge costs in certain expensive cases.

"That reinsurance aspect helps protect us from extreme variances in the care that we have to cover," said Aspirus President and CEO Matt Heywood. "That helps us be able to lower our rates."

Aspirus is a part-owner of insurance carrier Aspirus Arise. Aspirus anticipates being able to lower its premiums if Walker's plan becomes law. Walker believes that will be true in the in the individual marketplaces across the state.

"Premiums will go down dramatically for people on the individual market," he said.

Walker also hopes the change would attract more insurance companies to Wisconsin.

"I know that right now, we don't have enough choices, particularly in rural parts of the state," he said.

In 2017, most northcentral Wisconsin counties had three or four insurance carrier options on the individual marketplace. In 2018, most counties only had two options, as insurers pulled out.

"This would, one, help drive down premiums," Walker said "It wouldn't just go to insurers, it would help drive those premiums down, and two, that it would help encourage more of those plans."

Heywood said Aspirus doesn't take political stances, but he's a supporter of the plan.

"We take a stance on something we think that's good for our patients and it's good for health care," Heywood said. "Regardless of a Republican or Democrat proposing this, we would think this is the right thing to do for our patients and our communities."

Minnesota, Alaska, and Oregon all have similar plans to Walker's reinsurance proposal. The plan is up for votes this week in both the Assembly and Senate.

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