They Let Billions Get Stolen from Medicaid. Your Health Insurance Just Got More Expensive.

Minnesotans who pay for their health insurance through the individual market will again see double-digit increases in premiums for 2027 if proposed hikes are green-lit. Rates are proposed in the summer and finalized in October by the Minnesota Department of Commerce, just as voters are deciding who to vote for.

On the heels of last year’s brutal rate increases that averaged 21%, with Medica seeing an increase of over 30%, this year’s hikes will only add more pressure on policymakers as affordability takes center stage in the upcoming election. When insurance premium increases are approved and finalized weeks before Election Day, voters will receive notices of these premium hikes in the mail around the time ballots begin arriving. That should give heartburn to anyone on the ballot accused of not doing enough to control health care costs.

Minnesota Health Insurance Rate Increases

Individual Market – Plan Year 2027

Health Insurer2027 Rate Increase
Aspirus Health Plan, Inc.New Issuer for 2027
Blue Plus10.3%
Health Partners, Inc.12.4%
Health Partners Insurance Co.12.3%
Medica Insurance Company13.0%
Quartz Health Plan MN10.0%

Note: Aspirus Health Plan, Inc. is a new issuer entering the Minnesota individual market for 2027 and does not have a prior-year rate for comparison. Source: MN Dept of Commerce

Noticeably absent from the 2027 offerings is UCare. The 42-year-old company went into receivership and folded last year. The demise of that company underscores the extent to which subsidies, refinancing, and regulation have continued to grow spending in a state that needed to cut it. The inability to control spending has warped the economics of the market through intergovernmental transfers, sick taxes, and reinsurance. For UCare, those manipulations drove cost increases with no fundamental solutions to overspending, overutilization, and fraud that broke their business model.

Cost Drivers Remain Unchecked

Reinsurance is a means by which insurance company risk is partially socialized to taxpayers. This Minnesota-specific plan was passed into law and is now absorbed into the market, but the people writing the premium checks again seem not to have gotten a break. Voters were told that their premiums would go up 25% if the reinsurance program wasn’t passed. Well, it was passed, and premiums went up 25% anyway. Last year, Minnesota Senate Democrats proposed raising the sick tax by 11%.

Voters received a similar message around health care provider taxes, often called “the sick tax.” Governor Mark Dayton, a Democrat, killed the sick tax as federal Obamacare money flowed into the state, only to have Gov. Walz and a bipartisan group of legislative leaders revive the sick tax to prevent insurance premium increases.

Subsidies go up. Taxes go up. Spending goes up. But the increases are increasingly shouldered. by the people paying the lion’s share of health care costs. More than 1.2 million Minnesotans—one in five—are on MNCare and Medicaid. Add Medicare and other taxpayer-supported plans, and the remaining premium-paying families and businesses are pushed beyond the threshold of pain.

Minnesota families are rationing care and essentially acting as their own insurers of last resort. With sky-high premiums, the only way many can keep the lights on is to accept very high deductibles. This makes most care an out-of-pocket expense for middle-class families in the individual market. It also means mom and dad might save precious out of pocket dollars for the kids and pray that their needed care or diagnostics can wait.

An Issue of Fairness

Last year, Governor Walz and Democrats in the legislature rejected a proposal to save over $300 million in fraud and improper payments by simply asking insurance companies to perform minimum checks before receiving taxpayer-funded payments on behalf of Medicaid enrollees. The proposed “I’m not a robot” legislation would have required insurance companies to contact enrollees to verify that they live in the state and are still alive before continuing to receive monthly payments on their behalf. Does that seem out of line to ask? Walz and DFL leaders said no.

Minnesotans are tired of being the butt of jokes on late-night TV. Up to $9 billion was stolen from Minnesota taxpayers through fraud. It is time to focus on the easiest way to lower health care costs: cleaning up the fraud mess.