Thursday, June 07, 2007

The WHP Goes Through the Actuarial Wringer

I'll leave the details to future posts, but it looks like the Wisconsin Health Plan stood up well in a 170-plus page review by the gold standard of health care actuaries, the Lewin Group.

There wasn't anything new to the overall structure of the WHP, which the Wisconsin Health Project discusses here and I discuss here, but some of the funding details were altered and the Lewin Group also provided a definitive say on the savings from the WHP, which amounts to around $8.9 billion over the first decade. And that's with providing coverage to over 99 percent of the Wisconsin population.

And the Lewin study also details how the WHP would result in a hefty property tax cut for homeowners and businesses -- to the tune of just under $1 billion -- which would be funded through pulling the "Rolls Royce" public worker health benefits into the WHP fold. I imagine that would be music to a fiscal conservative's ears (but I know better than that).

More to come later...

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7 Comments:

Anonymous Anonymous said...

Some funding changes, are you serious? Employees share of tax went from 2% to 4%, while employers share can be as high as 12%. I do not know what report you were looking at. Go to Cuba if you want socialized medicine.

June 14, 2007  
Blogger Seth Zlotocha said...

Yeah, because employees and employers pay nothing for health care now, right? That 3.95 percent employee assessment would result in the average Wisconsin family paying $1,448 less than they do now for premiums. And even with the 11.55 percent employer assessment, employer spending on health care would decrease by $24 per worker for firms that currently provide their employees insurance. And this doesn't even get into the savings through business and household property tax cuts.

And I would love to see you explain how exactly the WHP amounts to socialized medicine.

June 14, 2007  
Anonymous Anonymous said...

Again, I guess the rich will be subsidizing this. So, if I make 200,000 and healthy I will pay more than someone making $50,000 and smokes and drinks. Does not seem fair does it. I HATE LIBERALS

June 14, 2007  
Anonymous Anonymous said...

It is socialized medicine, because my cost for health care is based upon my ability to pay and not on my health factors. I have a high paying job and my heath care is provided for by my employer. Under this plan, my taxes will go up big time. I make over $150,000. I am healthy and a non smoker. This does not seem fair to me.

June 14, 2007  
Blogger Seth Zlotocha said...

For starters, the employee assessment is based on social security wages, so it caps at $97,500.

And, no, you won't pay more making $200K and being healthy under the WHP than someone making $50K who smokes and drinks. There is a $700 annual difference between HSA funding and the deductible amount under the plan, which will need to be paid out of pocket in addition to co-pays prior to the deductible and 15% co-insurance payments after the deductible. The total out of pocket maximum is $2000 per year, so that person who smokes or drinks and faces health problems because of it -- either immediately or down the road -- will need to pay those out-of-pocket costs, while you, as a healthy person, can bank your $500 HSA contribution from year to year so you can save up for when your health does eventually take a turn for the worse (probably when you get over the age of 55, but possibly sooner).

And, lastly, your definition of "socialized medicine" is any plan that is even partially funded by taxes? Simply because funding for the system as a whole is partially socialized (see the cost sharing described above) doesn't mean in the least that the care you're receiving -- i.e., the "medicine" part of your politically-charged catch phrase -- is socialized. By that definition, any market that is subsizized by public revenue in any way is socialist (better tell our farmers). Providers and payers under the WHP are private, the government doesn't own or operate either (unless the provider is already government owned, such as the case with UW Hospital). In fact, the goal of the WHP is to shift more people into privatized care by virtually eliminating the uninsured population and, in the long term, phasing out Medicaid.

June 14, 2007  
Anonymous Anonymous said...

I have a few questions. What if a doctor does not want to be a part of this? At least now doctors can negoiate with some insurance companies for reimbursements. Under this plan, they would be at the mercy of one entity. The Government would be in control over reimbursements. Doctor fees under medicare are lower than the commercial plans. Mediaid rates are even lower. Under this plan the Government is going to force doctors to accept lower fees? If WHP comes to pass, can doctors then unionize and strike? It seems to me that to lower prices is to have more competition on the provider and insurance side, not less. Also, what type of medical issues will be covered. Since this will be tax funded are abortions going to be convered, what about all the so-called dieasese that liberals are going to want covered? This is just another entitlement program that liberals want us to pay for. Medicare is on the verge of paying more money out than it takes in in a few years unless provider reimbusements are cut or benefits are cut or taxes raised. Medicare only covers basically people over 65, under this plan, tax payers will be covering everybody. I hope the State Assembly does not pass this terrible plan.

June 15, 2007  
Blogger Seth Zlotocha said...

If you're truly curious about the WHP, why don't you just read about it? I don’t have access to any special insider info on the plan. Everything I know about it is outlined on the WHP website and in the Lewin Group report I cite in the post.

Don’t get me wrong. I’m all for having a substantive discussion on the WHP. But some of these points you’re tossing out for why it’s supposedly a terrible plan have no basis in reality. First it was the unfounded notion of the healthy and wealthy funding care for the unhealthy and less wealthy/poor, now it’s the completely false contention that the government is going to be setting reimbursement rates for providers and forcing those providers into negotiations.

The WHP is made up of private health plans that negotiate on their own with providers; the government doesn’t dictate that process. And if a doctor doesn't want to negotiate with one of the private health plans, she or he isn't by any means forced to do so.

Based on the cost of each private plan and the benefits included, the government puts those plans into tiers – Tier 1 being the least expensive and lowest amount of coverage, Tier 3 being the most expensive and most amount of coverage. And, if anything, the plan is a bonus to providers because it eliminates the need for charity care (which is just shifted onto the insured in our current system, anyway) and, in the future, it’s aim is to phase out Medicaid, which is a program that has extremely low reimbursement rates. If you want more, there’s an entire section on provider reimbursements on pages 53-54 of the Lewin report. The bottom line, according to Lewin, is that provider reimbursements would increase by about $110 million under the WHP. I don’t think any doctors will be going on strike over that.

As for what’s covered, the WHP expects coverage to be "substantially similar" to what’s currently offered to state legislators and employees through the state health insurance system. The specific coverage in those plans is outlined here. As for abortions, only therapeutic abortions – those to preserve maternal health – are required to be covered under a state health plan, so only therapeutic abortions would need to be covered under the WHP.

June 15, 2007  

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