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Walker seeks federal waiver for reinsurance program

Associated Press

MADISON, Wis. (AP) — Gov. Scott Walker’s administration filed a request with the federal government seeking a waiver that would allow Wisconsin to offer a $200 million reinsurance program designed to lower premiums and attract more providers to the private marketplace.

Walker told reporters on Wednesday that if the program is in effect premiums will go down by 5 percent in 2019, a shift after they increased 44 percent this year as enrollment dropped and fewer providers offered coverage. Walker said he was confident President Donald Trump’s administration would grant the waiver this summer.

“We feel very, very positive about our ability to get an approval and do so on a timely basis,” he said.

Under the reinsurance program, the government would provide money to health- insurance providers to pay about 50 percent of medical claims costing between $50,000 and $200,000 starting in 2019. J.P. Wieske, deputy Wisconsin insurance commissioner, said insurance providers will be required to file reports that will allow the savings to be calculated to by showing what rates would have been without the program.

Other states have seen success with their reinsurance programs. Rates are at least 20 percent lower this year in Alaska and Minnesota, and about 7 percent less in Oregon, the only three states with a reinsurance program. There was also a reinsurance program under the federal health care law for its first three years.

Democrats have criticized the policy, calling it an election-year attempt to disguise how damaging Walker’s opposition to the Affordable Care Act has been. The Legislature passed the bill authorizing the reinsurance program with bipartisan support.

Walker, a longtime critic of the national health-care law known as “Obamacare,” has rejected federal money to expand Medicaid and argued for years that the health-care law should be repealed. But this year, as he faces re-election in November, Walker has pushed the reinsurance proposal as a way to stabilize the market and lower premium costs for the roughly 200,000 Wisconsinites who purchase insurance under the law.

Walker originally said the state’s share under the 5-year program would be $50 million annually, and the federal government would be picking up $150 million. But he said Wednesday the state’s share, to be taken from unspecified Medicaid savings, would actually be $34 million a year. The federal government, he said, would pay the rest.

There were 227,000 people enrolled in an ACA plan through the private marketplace in Wisconsin in 2017, but that dropped to just over 202,000 this year. The decrease came at the same time premiums increased 44 percent from an average of $520 to $751 a month.

Under the reinsurance program, they are projected to drop to $710 next year.

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