Summary of Findings
This is the 12th annual report on Wisconsin’s regional health insurance costs.
The report documents conclusively the dramatic statewide impact of health insurance hyperinflation in Wisconsin before the passage of the Affordable Care Act (ACA) and after. Although health insurance inflation overall has moderated since the passage of the health care reform law, especially for large employers, this report shows that Wisconsin still has much work to do to address high health insurance costs and large regional disparities.
A major new finding this year is that health insurance rates actually went down from 2017-2018 for large and medium sized employers, an unprecedented result in the history of the report. This is in striking contrast to increases on the individual and small employer markets. The implications of this apparent decoupling of rates between different types of health insurance is discussed in the report.
Also new this year, the report documents the cost savings to consumers that would result if Wisconsin opened BadgerCare at cost to small employers and people who buy insurance on their own.
The report is also extremely relevant to the debate over whether to repeal the ACA, and if it is repealed what should replace it. The report offers historical comparisons of health insurance hyperinflation in Wisconsin before and after the implementation of ACA, broken down by each metro area in the state.
The 2018 Wisconsin Health Insurance Cost Ranking Report sheds light on how health insurance hyperinflation is impacting the major regions of the state, and therefore provides valuable insights for policymakers. As in the past eleven reports, this year’s report shows that although costs are high across Wisconsin, some regions of the state pay thousands of dollars more for health insurance than others.
Key Findings in 2018 Report (See cost ranking charts in full report)
Key Findings in 2018 Report (See ranked charts in next section)
1. Wisconsin Health Care Hyperinflation is a Long Term Trend. Wisconsin large group health insurance costs (premiums and deductibles) have more than tripled since the year 2000, increasing 209% statewide, with regional rates of inflation varying between a low of 168% in Madison to highs of 366% in Green Bay, 258% in Oshkosh, 248% in Appleton, and 220% in Milwaukee, for benefits packages that are less generous (See Chart 7).
2. The Rate of Health Care Hyperinflation Was Much Higher Before the Implementation of ACA. The rate of health insurance hyperinflation for large group insurance was 15x higher in the 13 years before the implementation of ACA than it has been in the 5 years since (15% per year statewide before vs 1% per year after, see Charts 3 & 4). Over three-quarters of Wisconsinites under the age of 65 get their insurance on the large group market. While this does not prove that the ACA is responsible for the decrease in the rate of inflation, it does call into question the claim that the health care law caused health insurance rates for most health consumers to dramatically increase.
3. The Rates for Large Group Health Insurance are Increasing Much More Slowly than Small Group and Individual Market. For the first time in the 12 year history of this report, the rates for large group insurance declined (Chart 10). Also, the annual inflation rate since the full implementation of the ACA 5 years ago is only 1% (Chart 4). The most trusted national data shows a very low rate of inflation for employer-based coverage between 2017 and 2018. On the other hand, rates continue to increase dramatically for individual market and small group insurance (Charts 11 & 12). This decoupling between insurance markets has substantial implications which are discussed in the policy implications sections below (also see methodological note on large group insurance at the end of last section).
4. Opening Access to Public Insurance for Individuals and Small Employers Would Dramatically lower costs. The proposed BadgerCare Public Option bill would reduce premiums and deductibles by an average of over $1,700 on the small group market and over $4,400 on the individual market, and even more in some high cost metro areas (Charts 15 and 16). This is discussed further in the policy implications section.
5. Regional Cost Disparities Persist. As in all 12 years of this report, there continue to be wide cost variations between higher and lower cost areas of the state. For example, there is a $1,785.72 difference in annual premiums on the large group market between Oshkosh, the highest-cost area, and Madison, the lowest-cost area (Chart 2). There is an even larger disparity on the individual market of $3,939.76 per year between Green Bay, the highest cost area, and the part of Wisconsin east of the Twin Cities (chart
6). Regional disparities are evident for all kinds of insurance (Chart 1, Chart 5).