On November 30, the Group Insurance Board (GIB) convened to discuss the nine responses received under the state’s Request for Proposals (RFP) to move employees to a self-insurance model. Under a self-insurance model, the state would assume the risk for claims and directly pay benefits. Currently, the state contracts with and pays a fixed monthly premium to 17 health insurers.

Prior to the meeting, the Department of Employee Trust Funds (ETF) released a report outlining the current State of Wisconsin Group Health Insurance Program (GHIP), benefits and concerns with self-insurance, and the RFP results. The report cited possible concerns to include increased risk for the state under the self-insurance model and potential administrative costs. As a benefit, ETF cited the elimination of Affordable Care Act (ACA) Market Share Fees, which would not apply under the self-insured model.

For several years, the state has been examining moving to a self-insurance model. Last year, ETF contracted with Segal Consulting to review the potential, if any, cost savings if the state made such a change. In their November 2015 report, Segal Consulting found there are financial reasons for the state to self-insure, potentially resulting in $40 million to $50 million in annual savings.

GIB moved into closed session to discuss the details of the RFP responses. However, several GIB members questioned the benefits of the current GHIP. The board is expected to consider potential changes to the state insurance program at its December 13 meeting. If GIB moves forward with a self-insurance proposal, the Joint Committee on Finance would have the opportunity to review and take action on a proposed contract.