Study: Insurance costs in Madison lower than rest of state
A study released Tuesday finds that the costs for employers of providing health insurance are lower in Madison than in any other part of the state, which the study's authors believe is due to the more competitive bidding power Madison companies and state employees have when shopping around for insurance coverage. The report found up to a 26 percent difference between the rates different cities and counties pay for health insurance in Wisconsin.
The average cost for a family health insurance policy in Madison is $4,146 cheaper than it is in the state's most expensive market, Eau Claire, according to the 3rd Annual Wisconsin Health Insurance Cost Ranking report released by Citizen Action of Wisconsin.
Northwestern Wisconsin has higher health insurance costs than anywhere else in the state, while inflation has hit northeastern Wisconsin especially hard. "This is shocking, stunning, amazing," said state Sen. Dave Hansen, alluding to the 262 percent jump over the past decade in health insurance costs for the Green Bay area he represents. "Too many people are falling through the cracks."
A slew of studies identify Wisconsin as one of the most expensive states in the country when it comes to shopping for health insurance. A 2005 GAO study found that out of the 319 metropolitan areas surveyed, eight of the top 10 cities in the country for physician costs and two out of the top 10 for hospital costs are in Wisconsin.
Rates have increased 30 percent faster in the state, excluding Madison, than the national average. The cost of employer-based premiums in the city has jumped 113 percent over the past decade, which is actually less than the national average of 149 percent, according to a national survey released by the Kaiser Foundation. Yet at the beginning of the decade, before prices shot up around the rest of the state, Madison's costs were similar. The study suggests that a key reason for the relative stability of the Madison market its huge pool of state employees, which forces insurance companies to remain competitive in bidding for their business.
Still, for Madison residents, as well as for others across the state, sluggish wages have not kept up with skyrocketting insurance and medical costs. Consumers in Madison are feeling the pinch, too. "Nobody would say health insurance is cheap in Madison, it's just that the area is not as badly hit as the rest of the state," said Robert Kraig of Citizen Action of Wisconsin.
Several state senators described the startling regional variances unveiled in this report as an issue that needs to be tackled. "We need to get a handle on why there is such regional variation before we understand what to do about it," said State Senator Kathleen Vinehout(Alma) during a conference call.
Agreed Senator Miller: "This report is a call to action."
