The state budget committee voted unanimously Thursday to reject Gov. Scott Walker’s proposal to move about 250,000 state workers to a self-insurance system.
Under the proposed change, the state would pay employee medical bills directly through a third-party administrator instead of paying premiums to an insurance provider.
Lawmakers had previously signaled they planned to reject the move, arguing it’s too risky. Leaders of the finance committee reiterated that point Thursday.
“Our competitive marketplace is really a model for the nation, and we think with what’s happening nationally this is the wrong time for us to make major shifts in the marketplace,” said Sen. Alberta Darling, R-River Hills, co-chair of the budget committee.
The governor had linked $60 million in estimated savings to the proposed move to self-insurance. The budget committee identified $63.9 million in other savings.
Those changes include $22.7 million in negotiation savings, $25.8 million from the state insurance board’s reserve fund, and $15.4 million from increased usage of health plan tiers and plan design changes. They say they’ll achieve those by making changes to employee benefit plans and using money from the state insurance board’s reserve fund.
Committee co-chair Rep. John Nygren, R-Marinette, said those plan design changes will not result in state employees seeing premiums, co-pays or other expenses rise more than 10 percent in each of the 2018 and 2019 calendar years.