Making Health Insurance Affordable One Step at a Time

“You are getting things done one step at a time, aren’t you?” the man said to me. He was talking about the new law requiring insurance companies to cover adult children up to age 27 on their parents’ plan.

The law – set to go into effect on New Years Day – was part of a Five Point Plan to Reform Health Insurance I wrote last January.

Reforming health care is no small task. But as Washington grapples with the big picture, the final part of my plan was signed into law this past week.

The five proposals that are now law will allow parents to cover their adult children on their own insurance plan; will limit the time pre-existing conditions can be held against someone to a year; will let consumers who have a quarrel with a health insurance company to have a free independent review if they want to resolve a dispute; will permit people to change plans within the same insurance company without additional underwriting and will make it is easier for people to get into the state’s high risk health insurance plan.

That final piece fell into place last week as the Governor signed two bills I authored allowing ease in accessing what the state calls “ Health Insurance Risk Sharing Program ” or HIRSP (as everything has to be known by initials!)

The high risk plan is now available to anyone who has been denied coverage by just one health insurance company. The plan has new low cost alternatives and subsidizes premiums for people making up to $33,000 a year. Recently, the HIRSP Board was able to reduce rates, send a rebate to those who paid high rates and expand subsidies to more low-income people because it lowered health care costs by 24% and lowered drug costs by 57%.

In a time when health care costs are rising by double digits every year, HIRSP is a quiet success story. The plan is paid for with absolutely no tax dollars – even though it was set up by the Legislature and has operated since 1981. It is run by an independent board representing health and consumer interests. The money for HIRSP comes from insurance companies who pay about twenty percent of the costs along with people’s premiums and doctors and hospitals that provide care at a reduced rate.

Without HIRSP, another 16,500 people in Wisconsin would be without insurance. Thirty four states have a high risk pool. But most states struggle with high costs.

The Wisconsin high risk plan has been so well managed – administrative costs are a low 4% and costs have come down. I would encourage anyone who might have thought the plan too expensive to look at it again. Feel free to call my office for help accessing more information for yourself or those you know who have serious health problems and have been denied coverage by an insurance company.

Having my Five Point Plan for Health Insurance Reform become law helps people by improving Wisconsin’s health insurance regulations.  In 2008 a Families USA report gave Wisconsin a failing grade for health insurance regulation. 

We think of Wisconsin as progressive but – surprisingly – this was not the case. For example, according to the Kaiser Foundation, thirty other states allow parents to cover their adult children on their health insurance policy but we did not.

Wisconsin will now join Louisiana, Mississippi and twenty five other states who forbid holding a pre-existing condition for more than a year against someone purchasing an individual plan.

Even as we make common sense change in Wisconsin, we look to Washington for the sorely needed comprehensive health care reform. The word on the street is U.S. Senate leader Harry Reid is very serious about passing reform before Christmas. He warned all Senators they will be in session on Christmas Eve or until the job is done.

The work is far from done and is painstakingly slow. But progress has been made and more Wisconsin families will find affordable health insurance as the New Year dawns.