Commissioner Nickel Op-Ed: Should the Federal Government Pick a
Health Plan Automatically for You?
Wisconsin consumers can currently choose from a variety of health insurance plans tailored to their specific needs including Wisconsin-based companies and national insurers, for-profit and non-profit plans, and a range of network options. Consumer choice has long been ingrained in all lines of insurance in Wisconsin and, as a result, Wisconsin is home to one of the largest insurance markets in the country.
Wisconsin also has one of the most competitive health insurance markets in the country. We have more than 20 insurers offering coverage in the individual market and more than 30 offering coverage in the small group market. It takes more than 15 insurers in the individual market to make up 80% of the market share and almost 20 insurers to make up an 80% market share in the small group market. By almost any measure, Wisconsin is one of the few states without a highly concentrated health insurance market. As a state, we have worked hard to preserve our competitive environment despite all the interference with our market by Obamacare.
Now, through a process known as "auto-enrollment," the federal government is determined to take those choices away from many consumers.
Obamacare's new auto-enrollment proposal is particularly frustrating. The proposal ignores centuries of contract law, is a violation of numerous Wisconsin consumer protection laws, and, most importantly, is harmful to Wisconsin consumers. We believe it is driven by federal officials that are facing significant market withdrawals by health insurers across the country and the need for a solution to sustain enrollment numbers.
Here is how the auto-enrollment proposal will work. In cases where a consumer's current health insurer is exiting the market and the policy was purchased through the federal exchange, the federal government will assign the consumer to a new health insurer if the consumer doesn't purchase coverage through the exchange. There is no way to opt-out. This process is called "auto-enrollment." The health insurer will receive a so-called "834" transaction and will be required to accept the new enrollee without necessarily knowing the consumer was involuntarily assigned to them. In order to ensure enrollment, the consumer's personal information—including financial information—will have to be sent from one insurer to the other insurer without the consumer's consent.
After the passage of Obamacare we have seen numerous insurers exit the health insurance market. This year, UnitedHealthcare—citing losses through the exchanges and as a result of Obamacare—announced a market withdrawal in Wisconsin and most other states. One Milwaukee-based health insurance company has closed its doors, so not only did consumers lose their health insurance plan, but hundreds of Wisconsinites lost their jobs. In Minnesota nearly 100,000 people will be losing their existing coverage due to another market withdrawal. The proposed assignment process—by forcing insurers to take on these unwilling consumers—could further destabilize health insurers leading to more market withdrawals. Government should not pick a consumer's plan.
Some might argue that the goal of getting more people health insurance coverage outweighs the consumer concerns. It has always been the goal of the Obama administration to use enrollment as THE metric of success, but enrollment is not and should not be the only metric for success.
The auto-enrollment proposal is seeded with a unique ability to sow chaos in an individual consumer's life. Health care is intensely personal. Consumers facing serious medical problems have their own needs. Because each health insurance plan includes an entirely different network of doctors and hospitals, consumers will not be able to maintain their relationship with their existing medical providers. Each insurer has a different prescription drug formulary which will provide different levels of coverage for consumer's existing medications. A consumer that has not agreed to an insurance contract—in fact may not even know the name of the insurer—cannot possibly know which medical providers are in the network, what the formulary covers, or what the insurer procedures are to cover medical care.
As the insurance commissioner appointed by Governor Scott Walker, we stand against costly federal intrusions into an individual's health insurance. As the impact of these decisions is felt in the Wisconsin market, consumers will continue to have fewer and fewer choices. Governor Walker has made it clear it is my job to protect Wisconsin consumers from the harmful effects of Obamacare as best I can. To that end and like many other issues, Wisconsin has informed the federal government that the auto-enrollment proposal is a violation of Wisconsin law.