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Wisconsin pushes higher health insurance costs

MedSave Admin | July 23, 2009

Wisconsin's new 2009-2011 state budget contains various new laws that will require the largest increases in health care spending that we have seen in any state. The new laws were signed into law this week by Governor Jim Boyle.

Some of the most costly provisions include:

  • Autism benefits are added up to $50,000 per year for intensive services for a minimum of four years and $25,000 per year for non-intensive services;
  • Coverage is extended to adult, unmarried child less than 27 years old
  • Coverage is extended for full-time students regardless of age
  • Pregnancy coverage is expanded to include outpatient health care, preventive care, drugs and devices
  • Coverage for contraceptives is added including the cost of doctor visits, consultations, examinations, and related procedures
  • The pre-existing condition "look back" period is limited to 12 months
  • Pre-existing conditions cannot be excluded from coverage for more than 12 months
Although the actual impact of the new laws on health insurance rates has not been published as of this date, it is fair to assume that the new law will trigger the largest insurance rate hikes ever seen by Wisconsin employers and individual insurance buyers. The cost impact is likely to be phased in over the next several years rather than hit as a shocking blow to policyholders.

We expect the cost pressure will cause more Wisconsin businesses to consider dropping their health insurance or seeking lower cost alternatives. The only remedy for businesses is to change from a major medical policy to a mini-med or limited benefit insurance. Most benefit professionals consider this approach too risky for the employees who are accustomed to full medical coverage.

Some types of individual health insurance is exempt from the new requirements and are likely to gain in popularity. Preferred risk plans. like CeltiCare, and age-rated health insurance will become a better value for younger buyers who are less likely to have problems with pre-existing medical conditions. Short term medical insurance, also exempt from most of these requirements, will be a more attractive option to those without pre-existing medical conditions.

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