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Health insurance inflation slowing in Wisconsin, report says

Health insurance inflation has slowed considerably in Wisconsin since the Affordable Care Act went into effect, according to a report released on Wednesday.

"We're not saying ... that the Affordable Care Act caused the inflation rate in health insurance to come down," said Robert Kraig, executive director of the consumer advocacy group Citizen Action of Wisconsin, and lead author of the report. "What we are saying is that claims that health insurance costs have spiked because of the Affordable Care Act are not supported by this data."

The rate of inflation for large group premiums and deductibles from 2000-13 averaged 15 percent annually in Wisconsin, according to the report. But from 2014-17 — post-Obamacare — the state's annual rate averaged 2 percent.

The data from the report are "contrary to a lot of conventional wisdom in the last election," Kraig said.

The figures for Superior were 14 percent before Obamacare and 2 percent after.

In a telephone news conference, Kraig, state Sen. Jon Erpenbach, D-Middleton, and others used the report as a warning to President-elect Donald Trump and the Republican-led Congress as well as to Wisconsin Gov. Scott Walker to use caution in undoing health care reforms of recent years.

"If it's just repealed, we're looking at huge increases in inflation again," said Erpenbach, who asserted that the slowdown in the inflation rate was related to Affordable Care Act reforms.

What hasn't changed, Kraig said, is a significant regional disparity in the cost of health insurance, with the lowest rates in Madison and the highest in the northern part of the state.

In Northwestern Wisconsin, that may have as much to do with what care costs as it does with insurance, Kraig said.

"Superior and Douglas County and (the surrounding area) have been consistently high throughout the history of this report, and it's high for all types of insurance," he said. "That indicates that the underlying price of medical care is probably the factor."

It's difficult to pin that down because of lack of transparency in pricing by pharmaceutical corporations and hospitals, said Kevin Kane of Citizen Action of Wisconsin, who co-authored the report.

"Part of what we keep uncovering here is that there are tremendous geographic variations that cannot be explained by quality, it can not be explained by the ... insurance companies alone," Kane said.

Among the 20 Wisconsin metropolitan areas studied, Superior had the sixth-highest overall health insurance cost for 2017 and the fourth-highest in the large group market, according to the report. Its single annual cost for premiums and deductibles in that category of just over $10,000 compares with a state average of just over $9,500 and a Madison cost of just under $8,000.

In terms of quality of health insurance plans, Superior ranked near the top, tied with Madison at 3.5 stars on a 5-star scale.

Based on the data, the cost of health insurance doesn't seem to correlate with quality, Kraig said.

"It's not a matter of you get what you pay for in health insurance," he said. "Quite the contrary."

This was the group's 11th annual report on Wisconsin regional health insurance costs.

Kraig, Kane and Erpenbach were joined by Tammy Wolfgram, who with her father owns a golf club in Hartland, Wis.

She and her late husband both had pre-existing conditions, Wolfgram said, and their youngest daughter had epilepsy. Before the Affordable Care Act, "we could not find private insurance who would accept us," she said.

But after the act became law, they didn't have to worry about being rejected, Wolfgram said. Her daughter, now over 26 and on her own, has affordable insurance through the federal website with low total out-of-pocket costs.

"If the Affordable Care Act is just repealed, I don't know what we'll do, especially for my daughter," Wolfgram said. "She would just be out in the cold."