Board Overseeing State Employee Health Benefits Delays Decision on Self-Insurance

Earlier this week, the board that oversees state worker health benefits—the Department of Employee Trust Funds’ Group Insurance Board (GIB)—postponed making a decision on whether and how to restructure the state group health insurance program. It will resume its discussion of options at its next meeting in January.

January 2018 is the earliest any program structural changes would take effect. Benefit or plan design changes are not being discussed in this process.

One reason the WASB is monitoring this issue is that during his appearance before the State Education Convention last January, Governor Scott Walker repeated a pledge he had announced during his 2016 State of the State address, to invest an unspecified amount of savings created by the proposed restructuring of state employee health care coverage into public education. It is unclear at present what the nature of those savings, if any, might be.

A move to self-insurance means the state would pay for health care directly and take on the risk for claims, instead of paying premiums to 17 HMOs. However, even a partial move to self-insurance would have to be approved by the Legislature’s Joint Finance Committee (JFC).

Earlier this week, the JFC co-chairs sent a letter to the GIB expressing concerns that even a move to regionalization for insurers could impact the state’s health care system without saving the state any money. The JFC co-chairs requested a meeting with the GIB chairs to further discuss the issue.

At this week’s meeting, ETF staff provided the GIB with seven scenario options based on the priorities identified by board members at a November 30 meeting.  Restructuring options presented to the GIB ranged from maintaining a version of the current program with improvements to contracting with one or two statewide vendors on a self-insured basis, as well as various regionalization options.

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