The Wyoming legislature has a long history of exploring ways to get quality and affordable insurance to more citizens, but for a variety of reasons, nothing has really ever worked. The legislature has long opposed accepting federal dollars to expand Medicaid due to fears that the money would eventually dry up and the state would have a program it could no longer afford. But there is not an available state solution either.
This year a legislative committee started kicking the tires on a proposal by the insurance commissioner where the state could use what's called a 1332 waiver and create a program that could reduce the premium for citizens who are in the federal marketplace or exchange. The waiver allows states to try innovative insurance programs, and Wyoming is looking for something that could reduce premium costs, especially for those who don't currently get subsidies to buy insurance. Reinsurance is where an insurance company would see its risk reduced or its exposure to a catastrophic event reduced. The plan is to put the sicker and higher risk people into a separate reinsurance pool.
State Insurance Commissioner Tom Glause wants to use a combination of state and federal dollars to pay for any catastrophic event that could occur.
"That improves the overall risk of the pool and the lowers insurance rates. What you realize then is some savings from federal pass-through dollars that you can use to fund that reinsurance pool."
Wyoming gets money to provide low-income residents a subsidy to pay for the high cost of insurance. Glause said it's that federal money that the state could use to fund a good chunk of the reinsurance pool.
"About 95 percent of the population on the exchange receives a subsidy, so if we drive the premiums down and we drive subsidies down and then the government allows the savings from those subsidy's to be used to fund a reinsurance pool."
Some legislators have worried that it sounds too good to be true, but Wendy Curran of Blue Cross Blue Shield of Wyoming, the only carrier available through the exchange said she's interested in the plan and added that in a place like Wyoming where there is a small population, this could work.
"So that should, in theory, lower the cost for the insured population and still assure that those who would be in the high-risk pool would still be getting affordable or premiums as well."
Another fan is Anne Ladd who heads up the Wyoming Business Coalition on Health. They have worked for years to try and find ways to get people better and more affordable insurance.
"I think it could work, I know that we have had a negative experience with a high-risk pool in the past, but at that point, we were telling people you have to apply to the high-risk pool and you have to pay the premium for that high-risk pool. And so, as a result, the premiums were very high and nobody went into it" said Ladd.
Ladd noted that with state and federal dollars keeping premiums for that high-risk population low, that makes this unique. The key is that the entire pool is not paying for a high-risk case.
"So yes we are asking the state to take on the additional risk, the state, and the federal government, of covering these very sick people so that the rest of the population can pay a lower premium and pay a more reasonable cost for their coverage."
Ladd thinks it's something the state should try. Curran agrees, but she adds that the new waiver rule gives the state the opportunity to try a lot of things.
"I think that's the beauty of this is that the waiver, particularly with the new flexibility that was recently announced, lets people have that discussion, what makes sense for Wyoming."
Insurance Commissioner Glause and the consultants will unveil their plan and projected costs to the legislature's Joint Health, Labor and Social Services Committee on Monday. It could be a tough audience, longtime Senator Committee Chairman Charles Scott has been skeptical and referred to it as "a something for nothing scheme."