Today Citizen Action released a new report update to our widely covered comparison of Minnesota and Wisconsin health rates, “A Tale of Two States.” The new report which compares 2015 individual market premiums in Minnesota and Wisconsin continues to show, as in previous research has, large cost disparities between the two states.
Key Preliminary Report Findings:
Statewide comparisons show large disparities. Controlling for population densities...
Average Silver plans are 60% more in Wisconsin, averaging $1,692 more per person per year, and
The average Silver plan in Wisconsin has a $600 higher annual deductible.
This disparity is even higher between Wisconsin Metros and the average across Minnesota.
Wisconsin Metros are seeing between 20% to 89% higher starting plans than the average across Minnesota and especially the Twin Cities Metro.
- This means that Wisconsinites are paying between $480 to $2,125 more per per year depending on location.
Western Wisconsin border counties continue to be far higher than their Minnesota neighbors. Superior, La Crosse and Hudson were between 78-89.5% more expensive, or between $1,872 and $2,125 more per person per year
Health insurance premiums in Milwaukee are 52% higher than the average across Minnesota, and 66% higher than in the Twin Cities.
- This disparity would skyrocket too if the Supreme Court rules against the tax credits in states with federal marketplaces like Wisconsin. For someone just over the poverty line their plans would suddenly be between 1,500% and 2,400% more than their income equivalent in Minnesota, depending on which WI area they live in
Figure 1: Wisconsin vs Minnesota vs US, Statewide, 2015, Silver Plan, 40 year old applicant
|Ave premium, monthly:||$373||$232||$314|
Figure 2: Cost Minnesota & Wisconsin Metros (Without Tax Credits), - Lowest Cost Silver Plan Monthly Premium, 40 year old & percent above Minnesota average.
|1. Twin Cities Metro||$181 (-0.8%)|
|2. Average across Minnesota||$198 (0%)||
Annual Cost Above MN
|3. Madison/Janesville||$238 (+20%)||+$480|
|4. Fond du Lac||$250(+26%)||+$624|
|5. Sheboygan||$258 (+30%)||+$720|
|6. Green Bay/Manitowoc||$266(+34%)||+$816|
|7. Appleton/Oshkosh||$272 (+37%)||+$888|
|8. Milwaukee/Racine/Kenosha||$301 (+52%)||+$1,236|
|9. Wausau/Stevens Pt/Wis Rapids||$302 (+52.6%)||+$1,248|
|10. Rhinelander||$303 (+53%)||+$1,260|
|11. Eau Claire||$323 (+63%)||+$1,500|
|12. Superior||$354 (+78.9%)||+$1,872|
|13. La Crosse||$359 (+81%)||+$1,932|
|14. Hudson||$375 (+89.5%)||+$2,124|
These disparities have the biggest impact on middle class Wisconsinites, because the progressive tax credits available under the Affordable Care Act successfully mitigate the impact on lower income families (see Figure 3). In these cases, the federal government is more than making up the gap for Wisconsin’s higher rates. On the other hand, many more low income adults in Wisconsin than Minnesota are paying private insurance premiums because Wisconsin rejected enhanced Medicaid funding provided by the Affordable Care Act while Minnesota has maintained original eligibility and accepted enhanced federal funding.
Figure 3: Metro Cost Disparity if King v. Burwell Decision Takes Away Tax Credits, Comparing Wisconsin metros to average Minnesota equivalent at 133% and showing how much more the same plan will be annually without credits
|% Increase Over Minn Equiv.||Annual Cost Increase w/o Tax Credits|
|1. Madison||+1,487%||+$2,676 a year|
|2. Fond du Lac||+1,567%||+$2,820|
|4. Green Bay||+1,673%||+$3,012|
|9. Eau Claire||+2,053%||+$3,696|
|11. La Crosse||+2,293%||+$4,128|
How Do We Fix It?
We have identified numerous public policy differences between the states that research has shown has an impact on the cost of private health insurance. We present a number of policy suggestions that can begin to address this cost disparity. To learn more about any particular policy suggestion we encourage you to download the report.
1. MEDICAID: Wisconsin should accept federal enhanced Medicaid funds and look into a “Basic Health Plan” to return BadgerCare to the former income eligibility of 200% of poverty line.
2. RATE REVIEW: Wisconsin should institute a “prior authorization” insurance rate review system to ensure that insurance rates are not excessive and reduce waste before consumers face them.
3. TRANSPARENCY: Wisconsin should use rate review to outlaw nondisclosure of negotiated health rates to providers and bring transparency to medical costs.
4. SUBSTANDARD PLANS: End the practice of allowing new non-Affordable Care Act compliant health plans to be sold.
5. MERGE POOLS: Consider cost reduction strategy of merging individual and small group markets risk pools. Allow large group employers of over 100 employees to join the marketplace in 2017.
6. MARKETPLACE: Create a Wisconsin-based health insurance marketplace to ensure all Wisconsin consumers continue to have access to quality affordable coverage across the state.
7. ACTIVE PURCHASE: Consider instituting an “active purchasing” marketplace to further reduce future insurance prices for Wisconsin consumers.
8. PUBLIC EMPLOYEE LEVERAGE: Add local county, city and school employees to public employee health plan to bring market leverage to regional health markets beyond Madison. Explore allowing private employers to join.
9. MEDICAID LEVERAGE: Use Medicaid to drive integrated delivery systems and develop medical homes for consumers.
Download the report to learn more. And be sure to use the links and buttons below to help share this report with others!