Report 2016: Wisconsinites Still Paying Far More Than Minnesotans for Healthcare

For the 3rd year in a row, Citizen Action's Minnesota Vs Wisconsin Healthcare Report shows that Wisconsinites are continuing to pay far more for healthcare than their Midwestern neighbor. Click here to read the whole report.

 Joining Citizen Action on a call to release this report was Ranking minority member of the Wisconsin Senate Health and Human Services Committee State Senator Jon Erpenbach, author of the legislation to improve Wisconsin's insurance rate oversight State Representative Debra Kolste, and member of the Minnesota State House of Representatives Committee on Health and Human Services Reform and Healthcare Economist State Representative Jennifer Schultz. Click here for a recording of the call.

KEY FINDINGS:

  • Statewide Wisconsin health cost to consumers - premiums and deductibles - continue to be far above Minnesota rates. The most common Silver plan leaves Wisconsin consumers paying 47% more (+$2,711) annually than Minnesota consumers

  • Looking at both premiums and deductibles, the overall cost disparity between states is actually increasing for 2016, with Wisconsin health insurance costs inflating faster than Minnesota’s. 

  • For individual Wisconsin metro areas, the second lowest cost silver plan total cost to consumers range from 13% to 91% higher in Wisconsin, compared to the average cost in Minnesota. 

  • These percentage differences translate into $737 - $5,207 more per person per year in premiums and deductibles in Wisconsin for a 40 year old depending on geography of applicant. (see Figure 3)

The findings in this report should be a wakeup call that state policy has a significant impact on health insurance costs, and that solutions should be near the top of the agenda in Madison.

As in all the previous studies, this report suggests that the two states differing approaches to implementing the Affordable Care Act partially explain the gap in health insurance rates between the two states. The obsession of Wisconsin elected leaders on obstructing the Affordable Care Act has distracted them from taking common sense steps that could improve  the Wisconsin health care system and make it more affordable.

Figure 1: Statewide weighted average of most common plan, annual premiums plus deductibles. 2016 vs 2015

 

Wisconsin

Minnesota

Percent higher in Wisconsin

2015

$6,796

$4,745

+43%

2016

$8,422

$5,711

+47%

Annual inflation

+28%

+20%

 

Analysis of annual cost of 2nd lowest cost plan for a 40 year old applicant without children or tax credits. Number shows 12 months of premiums plus plan deductible. Numbers are weighted by population density.


Public discussion of Minnesota’s health insurance inflation has up to this point failed to include the impact of deductibles. This exclusive focus on premiums has distorted understanding of overall costs to consumers. For example, in Minnesota metro areas such as Rochester and Duluth, the overall cost to consumers of both premiums and deductibles together has actually gone down for 2016.

Deductibles represent a major cost for consumers. Deductibles must be met before the insurer payments kick in for most medical services.

Figure 2: Most common plan for 40 year old by Minnesota metro, annual premiums plus deductibles, 2016 vs 2015. See full report

Comparing full consumer cost, both premiums annually and deductibles, within major metro areas reveals dramatic and shocking regional differences in what consumers pay.

 

Figure 3: Higher Costs to Consumers by Wisconsin Metros compared to Minnesota average, 2016, annual premiums and deductibles.

 

Additional Percent Consumer in Metro will Pay Annually Compared to Average Minnesotan

Extra Annual Cost Consumers Will See Compared to Equivalent Average Minnesotan

Statewide average

+47%

+$2,711

Madison

+13%

+$737

Janesville/Beloit

+13%

+$737

Superior

+18%

+$1,049

Eau Claire

+21%

+$1,217

Oshkosh

+26%

+$1,509

Kenosha

+30%

+$1,729

Hudson

+32%

+$1,845

Fond du Lac

+35%

+$1,993

Waukesha

+41%

+$2,341

La Crosse

+48%

+$2,734

Rhinelander

+52%

+$2,953

Appleton

+52%

+$2,994

Sheboygan

+52%

+$2,994

Green Bay

+54%

+$3,099

Manitowoc

+54%

+$3,096

Milwaukee

+82%

+$4,701

Racine

+87%

+$4,953

Wausau

+91%

+$5,207

Stevens Point

+91%

+$5,207

Wis Rapids/Marshfield

+91%

+$5,207

Analysis of annual cost of 2nd lowest cost plan for a 40 year old applicant without children or tax credits. Number shows 12 months of premiums plus plan deductible.

 

Figure 4: Total consumer cost by Wisconsin Metro, monthly and annually, 2016. See full report

 

Figure 5: Analysis of Wisconsin/Minnesota Border Cities cost average, 2016, annual premiums and deductibles

 

Percent Higher in Wisconsin City Compared to Minnesota City

Extra Annual Cost Consumers Will See in Wisconsin city vs Minnesota border city

La Crosse, WI vs Winona, MN

+27%

+ $1,827

Superior, WI vs Duluth, MN

+42%

+ $2,012

Hudson, WI vs Stillwater, MN

+35%

+ $1,982

Analysis of annual cost of 2nd lowest cost plan for a 40 year old applicant without children or tax credits. Number shows 12 months of premiums plus plan deductible.


Figure 6
:
Analysis of Wisconsin/Minnesota costs to consumers at different income levels, annual premiums plus deductibles, 2016. See full report

To learn more about the public policy implications and variations between Minnesota and Wisconsin that can help explain the large price disparities, click here to read the whole report.

Policy Proposals in this report

  • Wisconsin should increase its rate review authority, as has been proposed in a bill by Senator Chris Larson and Rep. Debra Kolste. In addition, Wisconsin could explore an “active purchasing” model to directly challenge high premiums and out-of-pocket costs
  • Wisconsin should immediately accept enhanced Medicaid funds to strengthen BadgerCare and begin to plan to accept “Basic Health Plan” dollars which can be used to return BadgerCare eligibility to 200% of poverty line for adults. Wisconsin should also explore federal waivers that can be used to ease health insurance costs for low income consumers.
  • Wisconsin should follow Minnesota, and end the sale of substandard non-Affordable Care Act-compliant health plans.

Questions? Email Kevin Kane at Kevin.kane@citizenactionwi.org

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