Out-of-Pocket Health Care Expenses to Rise for State Employees

The State of Wisconsin Group Insurance Board met today and voted to increase out-of-pocket health care expenses for state employees, including University of Wisconsin-Madison faculty. The changes go into effect January 1, 2016, and will net the state approximately $85 million over two years.

Governor Scott Walker proposed the changes as part of the 2015-17 biennial budget, which required the Department of Employee Trust Funds to identify and implement $81 million in savings from January 1, 2016 to June 30, 2017. The changes should also eliminate the so-called Cadillac Tax on employers who offer high-cost plans to their workers, set to go into effect in 2018.

Much of the savings will be realized through new deductibles and doubled out-of-pocket expenses for workers. Employees with single coverage will pay a $250 deductible and a maximum out-of-pocket expense of $1,000 annually, while employees on the family plan will pay a $500 deductible and out-of-pocket maximum of $2,000 annually. Essentially this is a pay cut of as much as $750 to $1,500 annually depending on the health insurance benefit plan an employee chooses.

Edited at 8:10 pm with correct figures for essential pay cut.