State's medical costs reach 2nd highest, leaders do nothing

A new report showing Wisconsin has the second-highest medical costs in the nation reinforces what health care advocates have been saying for years about the state’s health care cost crisis. The report from the Health Care Cost Institute, based on claims data from the nation’s largest insurers, found that the medical costs in Wisconsin are an astounding 81 percent above the national average.

Citizen Action of Wisconsin’s annual health insurance cost ranking report, published for ten consecutive years, has documented a more than tripling of Wisconsin health insurance costs since 2000. Citizen Action of Wisconsin also documented late last year a large gap in costs between Wisconsin and neighboring Minnesota, including a deeply troubling 46 percent increase in deductibles in Wisconsin for this year alone.

Skyrocketing health care costs threaten the right of every Wisconsin family to receive the care they need when they need it.  According to a recent survey, 83 percent of doctors have patients who have foregone or delayed treatment because of high out-of-pocket costs. To be priced out of medical care is as much of a violation of freedom as the outright denial of coverage.

Much higher than average health care costs is also an unnecessary drag on Wisconsin’s economy, increasing the cost of doing business and living in the Badger state.

As shocking as Wisconsin’s health care costs are, even more stunning is the lack of constructive policy making on the issue in Madison. Neither Gov. Scott Walker nor the the Legislature’s Republican majority has made health care costs a major agenda item.

For example, Sen. Chris Larson and Rep. Debra Kolste introduced a rate review bill which would have required health insurance companies to gain pre-approval for large rate increases. The bill also got to the heart of the medical service price problem identified by the Health Care Cost Institute: It required insurers that use medical costs as a justification for rate increases to make public the prices they negotiate for medical services with hospitals and other providers.

But the bill didn’t even receive a legislative hearing, let alone a vote in either house of the Legislature.

Wisconsin’s much higher than average health care costs cannot be blamed on the Affordable Care Act. The refusal of Gov. Walker and the Legislature to take any meaningful action on the health care cost crisis is public policy malpractice of the highest order. The next stage of health reform must focus on cost and value. High health care costs are rooted in collusion between the health insurance industry and the large hospital systems to keep prices secret, confusing for patients, and largely unregulated.

Robert Kraig is executive director of Citizen Action of Wisconsin.