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Group Insurance Board Approves Self-Funding State Employee Health Care

February 10, 2017

On February 8, the state Group Insurance Board (GIB) authorized the Department of Employee Trust Funds (ETF) to enter into contract negotiations with seven possible plan administrators across the state, moving the state employee health care program to a self-funded model. If approved by the Legislature’s Joint Finance Committee, the self-funded model will take effect January 1, 2018. 

The move to a self-funded model has been under consideration by the state for the past several years. Last summer, ETF released an RFP seeking responses from vendors, with potential vendors asked to bid on a statewide model and/or on a regional basis. After reviewing the results of the RFP, the GIB considered several options for moving forward ranging from contracting with a single statewide vendor on a self-funded basis to maintaining the current competitive structure under a fully-insured model. 

In the end, the GIB approved moving forward with self-funding the entire program and authorized ETF to enter into contract negotiations with a mix of statewide and regional administrators, as follows: 
  • Statewide Coverage: Compcare Health Services Insurance Corporation (Anthem Blue Cross Blue Shield)
  • Northern Region: Security Administrative Services
  • Eastern Region: Compcare Health Services Insurance Corporation (Anthem Blue Cross Blue Shield), and Network Health Administrative Services, LLC
  • Southern Region: Dean Health Plan and SPWI TPA, Inc. (Quartz)
  • Western Region: HealthPartners Administrators, Inc. 
Quartz is a third party administrator operated by the merged Unity Health Plan and Gundersen Health Plan organization. 

The state Legislature’s Joint Committee on Finance has final approval over any contract approved by the GIB. In a paper released in advance of the meeting, ETF indicates that to move forward for January 1, 2018, contract negotiations must be completed by the end of March, and Joint Finance Committee review and approval would have to occur by the end of May. 

This story originally appeared in the February 10, 2017 edition of WHA Newsletter