Changes to Health Insurance Coverage in Wisconsin
Health insurance providers are set to discontinue personal and family plans through the Affordable Care Act market in 11 counties across Wisconsin next year. This change will affect approximately 24,000 individuals, who will need to seek new coverage options.
The General Ground Healthcare Cooperative plans to exit the market in counties including Milwaukee, Kenosha, Racine, and several others. A spokesperson noted that this difficult decision was made to maintain sustainable operations amid significant industry changes. Although affected members will continue to receive benefits until 2025, they will be required to find new health plans once open enrollment begins on November 1.
The statement stressed that this choice was not taken lightly, emphasizing the need to adapt to rising costs. Despite this, Common Ground will continue providing health coverage in 13 other counties, such as Brown and Waukesha.
Since 2014, Common Ground has offered ACA Marketplace coverage in Eastern Wisconsin. However, the decision to terminate coverage in certain counties is unrelated to recent mergers with Caresource. They clarified that this decision was motivated by rising care costs in these specific areas.
As of December 2023, Common Ground remained financially stable. State reports indicated notable losses in 2021 and 2022, yet positive results were anticipated in 2023.
Factors influencing the exit include increased operational costs and the expected expiration of expanded pandemic-era tax credits. Nationwide, insurers are anticipating a roughly 20% increase in premiums next year. Enhanced premium tax credits, introduced during the Biden administration, had previously expanded eligibility and helped reduce costs, encouraging high enrollment. However, these subsidies are set to expire soon unless renewed.
Dan Sachs, a risk and insurance associate professor, highlighted that the looming end of these tax credits likely played a role in Common Ground’s decision. Without these subsidies, he suggested that healthy individuals might opt out of insurance, leading to a less diversified customer pool and potentially increasing costs for those with chronic conditions.
He remarked that when subsidies are removed, it typically becomes less profitable for insurers to provide coverage, which could explain why companies might withdraw.
There’s also a growing concern about premium increases; recent forecasts indicated that without enhanced subsidies, ACA premiums could rise significantly.
In response, Governor Tony Evers, along with 17 other governors, plans to send a letter to Congress urging them to expand the enhanced grants to alleviate potential financial burdens on the public.
He pointed out that many people struggle with rising costs and shouldn’t have to choose between essential health care and basic living expenses.
In addition to these changes, some health insurers are opting to exit the ACA Marketplace entirely. Chorus Community Health Plan, another insurer in Wisconsin, has announced its departure from the ACA Marketplace in 2026, citing persistent financial challenges. Reports indicated significant underwriting losses over the past few years.
Nationwide, CVS Health’s AETNA will also discontinue personal plans on the ACA exchange starting in 2025, reflecting broader trends in the market.
Sachs noted that the combination of removing premium tax credits and overall market instability makes it difficult for insurers to sustain profitable operations, leading to more exits from the ACA landscape.
He recounted how early generous subsidies initially attracted many insurers, but as support dwindled, numerous companies withdrew. The cycle appears to be repeating now, with concerns rising as enhanced premium tax credits are set to end.
