Wis. Launches First Health Insurance Cooperative

The first health insurance cooperative in Wisconsin is set to be introduced this month to help small businesses, nonprofits and individuals negotiate affordable insurance plans.

According to Associated Press, Co-op Care of Southeastern Wisconsin is preparing to roll out its health insurance plans at the end of this month and start signing up members, said Randall Marking, president of Innovative Benefits Solutions Inc., a Milwaukee firm that designs employer benefits packages.

The cooperative is the first to be organized under legislation signed by Gov. Jim Doyle in December 2003 authorizing creation of five regional health care purchasing alliances in the state (IJ, Sept. 5, 2005).

Aimed initially at farm families and small businesses, the member-owned regional health care co-ops eventually could serve the self-employed, employees of nonprofit groups, early retirees and others hard-pressed to pay premiums and deductibles typical of non-group health plans.

Last month, Doyle signed another bill into law that allows as many heath care co-ops to be organized as needed to benefit more people.

The Wisconsin Federation of Cooperatives is organizing a health care co-op in northwestern Wisconsin, in the Eau Claire area, aimed at providing farmers and small rural businesses affordable group health insurance plans.

Bill Oemichen, the federation’s president and chief executive, who pushed for enactment of the original legislation, said creation of the northwestern co-op is taking longer than expected but there is considerable interest among farmers, Associated Press reported.

“They’re seeing double-digit increases in premiums this year,” said Oemichen. “One guy had a 36 percent increase and, sadly, that appears to be pretty typical.”

Large companies can design their own health insurance plans, offering a choice to employees and negotiating the best rates from insurance and health care providers, Marking said.

“The small guy just doesn’t get to do that; they basically have to buy something off the shelf,” said Marking, who also works with large companies in the area.

“We’re in the midst of a big change in health care, and the small to midsize employers will be able to participate to the same degree as larger employers,” Marking said.

The move comes at a time when average premiums for health care plans rose 7.2 percent in southeastern Wisconsin compared with a 9.6 percent increase nationally, according to a recent survey released by United Benefit Advisors, an employee benefits advisory organization.

The organization polled 125 employers in southeastern Wisconsin and more than 8,700 employers nationwide with at least 25 employees, said Matt Weimer, director of group operations for Diversified Insurance Services Inc., Waukesha.

The survey will allow “companies to compare their design against other employers of similar size and industry code,” Weimer said. “A lot of times, smaller employers aren’t participating in larger surveys.”

Average premiums for single coverage rose to $352 in southeastern Wisconsin and $327 nationally, the survey said.

Meanwhile, in another recent study by the Wisconsin Hospital Association and Wisconsin Medical Society, more than 75 percent of participants said they would support a law reinstating a limit on medical malpractice awards.

The 500 poll participants cited concerns about rising health care costs, a possibility of doctors leaving Wisconsin to practice in other states because of higher medical liability costs and limited access to obstetrical care. Public Opinion Strategies, a national political and public affairs firm, conducted the poll.

The Wisconsin Supreme Court ruled last month non-economic damage caps on malpractice jury awards are unconstitutional, eliminating a cap of $350,000 set by the state legislature in 1995. Adjusted for inflation, the cap is currently $445,775.

Darcy Haber, director of the health care campaign for Wisconsin Citizen Action, a public interest advocacy group, questioned the survey’s findings. In a separate statement, Haber said the survey is “utterly bogus unless survey respondents were provided with an objective account of the current situation and a fairly-phrased question.”

Gene Ulm, a partner with Public Opinion Strategies, said 66 percent of respondents supported a new law before being asked to respond to statements regarding how access to health care changed in states that didn’t have caps.