Tag Archives: citizen action of wisconsin

Opinion: Walker has rigged health insurance system to raise rates

A much larger number of Wisconsinites than previously believed are enrolled in substandard health plans that don’t meet the standards of the Affordable Care Act. In fact, almost as many people are enrolled in substandard “lemon” health plans in Wisconsin as in individual coverage through Healthcare.gov.

The state’s inadequate health insurance situation was revealed by J.P. Wieske, the deputy insurance commissioner for Gov. Scott Walker’s administration, in testimony before the Homeland Security Committee last week.

Wieske’s admission has major implications for the availability of affordable health care in Wisconsin. It provides evidence that the Walker administration is working to sabotage the health care law.

In the hearing Wieske testified (p. 6–7) that 203,000 Wisconsinites are covered by so-called “transitional plans,” the technical term for most plans not in compliance with the ACA. These are also often referred to as “grandmothered” plans. Currently 239,034 Wisconsin health consumers are enrolled in individual coverage on Healthcare.gov. The numbers show how much larger the ACA marketplaces in Wisconsin would be if transitional plans were prohibited.

Under the ACA, states were allowed to “grandmother” plans sold during the health care law’s implementation period, even when they did not meet the standards of the new law. The consumers in transitional plans tend to be healthier, because the insurance corporations were still permitted at the time to discriminate against people with health conditions. Wisconsin exercised the option to continue these plans, while Minnesota and many other states working to improve health insurance access banned them.

Transitional plans have two highly negative consequences for health consumers.

  • Substandard “lemon” plans increase prices in the ACA marketplace by skimming healthier people. These people were able to buy insurance before discrimination against people with health conditions was banned. This deprives healthier individuals from the ACA marketplace, leaving the remaining population sicker and costlier, and raising rates.
  • Substandard “lemon” plans might be cheaper, but they become dangerous for health consumers when they face a major injury or illness. The plans often have gaps in coverage or extremely high cost sharing.

There is strong evidence that allowing the health insurance industry to continue to sell transitional plans increases prices.

  • From the Rand Corporation: “Non-ACA-compliant plans … have a far more detrimental effect on the ACA-compliant market, raising premiums by as much as 10 percent and decreasing enrollment.”
  • From the American Academy of Actuaries: “In states with the transition policy, ACA-compliant plans exhibited less favorable experience, because lower-cost individuals were more likely to retain their prior policies.”
  • From Milliman Actuaries: “Integrating these underwritten members into the ACA pool is expected to improve the health status of the market as a whole, which could lower the relative cost of coverage on average.”

It is hard to escape the conclusion that the Walker Administration is deliberately trying to destabilize the Affordable Care Act by allowing insurance companies to skim healthier consumers. The impact of this policy is to rig the health care system against Wisconsin families who need access to quality affordable coverage.

The only party who benefits from the continuation of “lemon” health plans is the insurance industry, which is allowed to continue to profit by separating the healthy from people with health conditions.

— Robert Kraig and Kevin Kane, Citizen Action of Wisconisin

 

Watchdog: Seller of EpiPen heavily lobbied Wisconsin GOP

Citizen Action of Wisconsin says Mylan, the seller of EpiPen, “contributed thousands of dollars to GOP state legislators in Wisconsin and spent tens of thousands on lobbying to influence the Legislature to help it increase its market in Wisconsin. The legislation is helping Mylan build the monopoly it needs to overcharge for the medication.”

Since 2014, Mylan’s corporate PAC made thousands of dollars in contributions in Wisconsin exclusively to Republican state legislators, focusing on those who serve on the Senate Health Committee, according to CAW based on data compiled by the Wisconsin Democracy Campaign.

Mylan also spent $42,000 between 2013 and 2014 and $24,500 between 2015 and 2016 lobbying in Wisconsin on issues “… affecting the manufacture, distribution, or sale of prescription drugs and medical devices,” as well as on what became 2013 Wisconsin Act 239 and 2015 Wisconsin Act 35 and broadly on “anything relating to generic pharmaceuticals.”

These two measures expanded the scope of users of EpiPens to “recreational and educational camp, college, university, day care facility, youth sports league, amusement park, restaurant, place of employment, and sports arena,” as well as “public, private, or tribal schools.”

Together this expansion is projected to cost the state $77,500 per year for the state to administer.

CAW said “in return for its political donations and lobbying, Mylan has successfully induced state legislators into participating in its marketing scheme to wring windfall profits out of Wisconsin families seeking protection from severe allergic reactions.

The group cited a Wisconsin Public Radio radio report and said Mylan has used state legislation to expand the EpiPen market “in order to position itself to reap a cash windfall from raising prices. With no justification other than profit, Mylan has increased the price of EpiPens by 5 fold since 2007, to the current price of $633 for a two-pack.”

“It is hard to imagine much worse than a family priced out of a medication that could save their child’s life because of the greed of a drug corporation,” said Robert Kraig, executive director of CAW. “Mylan is engaging in grossly unethical business practices with the assistance of state legislators. Under current Wisconsin law, drug corporations like Mylon have the unlimited ability to charge unjustified prices for life-saving medication.

“What Mylan is doing is like selling food or water at a grossly inflated price during a natural disaster. Wisconsin families are trying to pay the inflated price because of the potential life-saving value of the drug.”

CAW said lawmakers should stop promoting the expansion of the EpiPen market and take up state Rep. Debra Kolste’s legislation on prescription drug transparency, which would force Mylan to justify the price of its medications.

Citizen Action: Walker administration withholds health insurance rates

The Walker Administration — for the second consecutive year — is withholding the rates for the health insurance marketplace, according to Citizen Action of Wisconsin.

The group says the administration is leaving consumers, health advocates and policymakers in the dark and it called on the Wisconsin Office of the Insurance Commissioner to promptly release the figures. 

The deadline for 2015 rate submission for insurance companies selling marketplace plans in Wisconsin was June 27.

At that time, the OCI said it would need up to 60 days to analyze the rates.

Citizen Action of Wisconsin says two-thirds of states have released 2015 rates for healthcare.gov, in advance of the open enrollment period that begins on Nov. 15.

“Last year the Walker Administration tried to use the rate release process to spin the numbers and make misleading attacks on health care reform,” said Robert Kraig, executive director of Citizen Action of Wisconsin. “We are growing concerned that the Walker Administration will either withhold the 2015 rates until after the election, or attempt to release them in a biased and partisan fashion. Consumers and health advocates have a right to know what the insurance rates will be, and how Wisconsin stacks up with other states.”

The Republican governor, who is running for re-election against Democrat Mary Burke in November and who may run for president in 2016, is a staunch opponent of federal Affordable Care Act and the Obama administration’s efforts to expand health care opportunities.

Earlier this year, Citizen Action of Wisconsin released a report showing that marketplace rates in Wisconsin are $251 per year higher on average because of Scott Walker’s decision to reject enhanced funding for Badgercare, and $747 higher on average because of the Walker administration’s refusal to implement what CAW described as a robust rate review.