ETF Responds to LAB Audit of the State’s Group Insurance Programs

MADISON, Wisconsin, Feb. 15 -- The Wisconsin Department of Employee Trust Funds issued the following news:

Low-growth health insurance costs and high satisfaction among employers participating in the state's Group Health Insurance Program are two key takeaways from an audit by the Legislative Audit Bureau. The audit evaluates the Group Insurance Board's oversight of the group insurance programs administered by ETF.

The LAB's independent actuary concluded the Group Insurance Board's reserve methodology is reasonable and appropriate. The Board has used reserves in seven of the past nine years to keep costs down and will continue to use the reserves as necessary.

"I'm pleased the LAB report identified no significant concerns. There are several good recommendations in the report, many of which we will implement, have implemented or are in the process of implementing. I appreciate that the LAB has pointed out ways we have improved the administration of the programs over time," said ETF Secretary Robert Conlin.

In a formal response to the LAB, ETF addresses various findings and provides helpful background information.

Group Health Insurance Program

Over the past decade the Group Health Insurance Program has gone through tremendous changes and the role of the Group Insurance Board has expanded. The administration and legislature also have directed the Board to decrease the state's cost of the program. Since 2015 the Board has successfully met mandated savings of more than $154 million from administrative efficiencies, plan design changes and health plan negotiations.

In addition to meeting budgetary directives to help balance the state's budget, the Group Insurance Board and ETF have made program improvements to offer members choices, quality care, and promote a healthier workforce.

Highlights of program improvements and outcomes include:

* The Group Health Insurance Program had an average annual cost increase of 3.7%, compared to the national average of 7.7% for 2009 through 2017.

* The Group Insurance Board approved using more than $140 million in program reserves to reduce and stabilize premiums paid by employees and employers from 2009 through 2017.

* The Well Wisconsin Program had a 70% increase in enrollments in plan years 2016 through 2018.

* The High Deductible Health Plan had a 37% increase in enrollments for plan year 2019, compared to the previous year.

* the deficit will be eliminated by 2021, due to increased contributions.

For more information, see the full LAB report (http://legis.wisconsin.gov/lab/) and ETF's formal response (http://etf.wi.gov/news/GIB_AuditResponse_Feb2019_Final.pdf).