WEA Trust to stop offering health insurance in Wisconsin, lay off 110 employees

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Alexander Shur | Wisconsin State Journal

Madison-based WEA Trust, a health insurance company wounded by the passage of the 2011 Republican anti-union law Act 10, will stop offering health insurance at the end of 2022.

The company will lay off 110 employees, it said in a statement, and offer each employee a severance package and at least 60 days notice. It will continue offering long-term care, life and vision coverage for its members.

WEA Trust clients will have until the end of 2022 to find a new insurer. Nearby employers insured by WEA Trust include Reedsburg school district.

“The challenges related to healthcare consolidation, the costs associated with the global pandemic, and the drop in the stock market have made it difficult for local, not-for-profit organizations like ours who seek to provide families with high value personal care,” company president and CEO Vaughn Vance said in a statement.

“It became clear that we had to make the difficult decision to pivot as an organization before we sacrificed what has made WEA Trust unique for many years,” Vance continued.

WEA Trust was created by the Wisconsin Education Association Council in 1970 to serve Wisconsin school district employees.

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The company insured the vast majority of school districts before former Gov. Scott Walker’s Act 10 in 2011 blocked unions from negotiating over benefits, which led school districts to shop for cheaper alternatives, resulting in a stark revenue loss for the company. Conservatives heralded the change, saying it saved school districts tens of millions of dollars around the state.

“For years taxpayers across the state were getting a raw deal,” Walker said in a 2012 press release. “Collective bargaining stymied competition for benefits in the health insurance market, and instead directed property tax revenue to those affiliated with big government union bosses,” adding taxpayers were saving millions with the changes he enacted.

WEA Trust has since expanded to cover state, county and municipal workers.

WEA Trust spokesperson Steve Lyons said Act 10 had nothing to do with the company’s decision to pull out of the health insurance market in Wisconsin.

“It’s a difficult decision by WEA Trust, but it’s also a difficult day for the state of Wisconsin,” Lyons said in an interview, adding the company’s workers live and work in the state.

“When you call WEA Trust, not only do they know how to say Oconomowoc, they know where it is on a map,” he said.

This story was corrected to reflect that Columbus School District did not use WEA Trust for health insurance.

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