August 17

Madison)-The market competition approach used in the State Group Health Program again proved its effectiveness in controlling costs, as the Group Insurance Board approved an overall 1.6 percent non-Medicare premium increase for 2017.  The premium trend was announced in an August 16 Department of Employee Trust Funds (DETF) news release, which also noted the favorable comparison against nationwide health insurance premium projections of 5 percent to 6 percent increases for 2017. 

"Wisconsin's fully insured health plans showed once again the current competition model makes Wisconsin's State Group Health Program one of the most effective cost control programs in the country," said Nancy Wenzel, CEO of the Wisconsin Association of Health Plans. 

"Why would taxpayers support a plan to abandon the current approach and its proven track record in exchange for higher financial risk for the state, disrupted health care services for patients and a weakened competitive health insurance market for purchasers?" Wenzel said.

The Group Insurance Board (GIB) is considering a consultant's recommendation to replace the market competition approach with a state government run, self-funded model.  On July 22, DETF issued a request for proposals (RFP) for self-funded administration of the program and will use the results to evaluate the recommended self-funded approach.  Wisconsin's community-based health plans believe actual, consistent program experience validates self-funding is the wrong direction for the State Program.  Further, community-based plans believe an RFP won't show the full impact of the proposed changes on the state program, on taxpayers, on the health insurance market and on local communities.

An Extended Record of Effectiveness

The overall 1.6 percent premium increase for the 2017 State Group Health Program continues a seven-year run of health care cost control and financial savings for the state of Wisconsin.  For the five-year period preceding 2016, DETF reported premium trend of 2.5 percent per year for the State Group Health Program.  And in 2016, DETF reported a reduction of 2.5 percent in premium.  The reduction contrasts significantly with the 6.7 percent increase experienced by other Wisconsin employers, according to M3 Insurance. 


State Group Health Program Premium Trend





2011 - 2015


*Compared to 6% increase projected nationwide by the National Business Group on Health.

**Compared to 6.7% premium increase for Wisconsin employers reported by M3 Insurance.



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