Cases are rising, but more restrictions aren’t necessary
Of recent, Minnesota has been on the news, and not for a good reason – cases are rising in our state compared to most. For all its strict restrictions, Minnesota…
Republicans in the Minnesota House and Senate began the 2017 legislative session with a plan to provide immediate and temporary relief to the thousands of Minnesotans who are stuck with outrageous premium hikes and canceled policies in the chaotic individual health insurance market.
On top of this immediate relief to Minnesotans, the plan proposes a handful of regulatory reforms to improve Minnesota’s health care system over the long-term.
These are just the first steps being proposed by Republicans to fix the present crisis created by the imposition of the Affordable Care Act regulations on the state’s health care system.
What are these first steps exactly?
The immediate relief consists of two components that are both limited to 2017. First, the plan provides $285 million in immediate premium assistance to people with incomes ranging from 300 and 800 percent of the federal poverty guideline. These are the Minnesotans who make too much to qualify for federal tax credits and not enough to avoid feeling the pain of the 50 to 67 percent rate increases for 2017 premiums.
Throwing money at the problem is no long-term fix, but for this year the premium assistance functions largely as a quick and simple risk adjustment mechanism to adjust for the individual market’s much higher risk profile compared to the group market. The state’s former high risk pool successfully adjusted and shared the cost of high risk individuals across both the individual and group health insurance markets. Now the individual market pays the entire bill for those high risks. Long-term the state should go back to a high risk pool or implement a more refined risk adjustment mechanism to improve the stability of the individual market.
Second, the plan provides immediate relief to the many Minnesotans who found their doctor would no longer be in their health plan network in 2017. Over 100,000 people lost access to the Blue Cross Blue Shield of Minnesota network when the company decided to leave the market. Thousands more lost access to the HealthPartners network after the company stopped offering coverage outside the Twin Cities and St. Cloud regions. The Republican plan would provide some funding for people to continue receiving treatments from the same provider for a short time.
The regulatory reforms look to deliver more long-term solutions and primarily aim to expand options for consumers, tighten up consumer protections and stabilize the individual market.
Small businesses would get expanded health care options. One reform would make it easier to create a self-funded health plan coupled with reinsurance to cover high-cost employees. Another reform would take advantage of a recent federal law that allows small employers to reimburse employees’ individual health insurance premiums.
Consumers would potentially find new for-profit HMOs to choose from in the individual market. Minnesota’s largest company, UnitedHealth Group, can’t participate in Minnesota’s individual insurance market because state law bans for-profit HMOs. This ban would be lifted.
On the consumer protection side, consumers would be given more transparent information on proposals to increase rates, as well as protection against surprise billing that can happen when providers bill out-of-network charges for provider services delivered at an in-network hospital.
Finally, the plan requires the Department of Commerce to develop a plan to create a verification system to guarantee people don’t game the individual market enrollment process — a critical policy necessary to stabilize the market so long as insurance companies are mandated to provide coverage to all comers.
Altogether, these reforms are just the first steps toward fixing Minnesota’s health care system. Much more will need to be done to undo and unwind the Obamacare regulations that created the present crisis.
Anyone expecting an immediate fix will be disappointed. The disruption to Minnesota’s health insurance market took years to create and will take years to fix. The largest obstacle to a timely fix is the fact that anything the state might do will be subject to future actions taken by Congress and president-elect Trump.
Without yet knowing what the federal government might do, Minnesotans will need to be patient with state lawmakers as they develop the fixes Minnesota’s health care system needs for long-term stability and success.