Governor Signs Budget That Impacts Insurance Market Rules and Public Programs
July 22, 2009 – Governor Jim Doyle has signed a budget bill that changes the rules in the individual health insurance market and expands eligibility for public programs. Effective in 2010, all health plans sold in the individual market will have to use a uniform application. In addition, insurers will be prohibited from "looking back" more than one year to establish a pre-existing condition exclusion. The exclusion period for pre-existing conditions is reduced from two years to one year and the new rules allow an individual to change their coverage policy upon renewal without being subject to new pre-existing condition exclusions or premium rating based on health status. The new individual market rules enacted in the budget bill also require independent third party review of pre-existing condition exclusion denials and coverage rescissions. In response to the state's estimated $6.6 billion state budget deficit, the budget bill also calls for a $625 million reduction in Medicaid funding resulting in significant changes to the state's Medicaid program including reductions in provider reimbursements for specific procedures, modifications to provider reimbursements based on quality outcomes, the introduction of evidence-based health care initiatives, and the reduction of administrative rates for insurers. The state budget also increased the state's hospital assessment to leverage additional federal matching funds to be used for increased reimbursements to hospitals, and in part, to pay for an expansion of the state's Medical Assistance programs for childless adults with family incomes at or below 200 percent of the federal poverty level.
