Health insurance hikes on State Capitol front burner

Health insurance on State Capitol front burner

MINNEAPOLIS -- At the State Capitol Republicans and Democrats alike have recognized the urgency of helping those who are struggling with rising costs and dwindling options in the individual health insurance market.

That's roughly five to six percent of all of those insured, roughly 280,000 people who aren't part of any group plans and have to buy coverage directly from insurance companies.

"It’s a relatively small group of people, but when they look at those prices they might consider not purchasing health insurance at all," Sen. Kathy Sheran, a Mankato Democrat, told reporters at a Friday afternoon press conference.

"If we don't help them we put them at risk of bankruptcy because it only takes one, or two, or three incidents to really throw people into crisis."

House Republicans held a separate event at the State Office Building Friday, inviting consumers to vent their frustrations about the new reality they face now that Blue Cross Blue Shield has exited the individual insurance market.

"We are worried about possibly getting no insurance, and if we do we could see premium rates at $2,000 a month, and for a deductible of $13,000 a year," Julie Jahr, a farmer from Arlington, Minn. explained.

"I’m not sure where all of that is going to come from."

Jahr said her family originally had a Preferred One plan, but when that company dropped out of the market she switched to Blue Cross.  When Blue Cross decided not to offer individual plans for 2017, it led to other providers raising rates and in some cases announcing enrollment caps.

Those who earn up to 400 percent the poverty rate can qualify for discounts or subsidies known as "premium tax credits" to help offset the costs of their monthly payments. That threshold ranges from $47,000 for a single person to $97,000 for a family of four.

Those discounts are only available for those who shop for plans using the portal. Jahr said she bought her plan through a local insurance agent and hadn't gone through MNsure to check on whether her family would qualify for those tax credits.

Lawmakers are focusing their efforts on those who earn too much to qualify for those discounts, but can't afford the premiums and steep deductibles that come with the plans available in the individual market.

Democrats, while agreeing the situation is urgent, say a special session on the issue would be more likely after the Nov. 8 election. But Republican leaders say it's a crisis that must be addressed immediately.

Possible solutions

Both parties have proposed short-term help, in the form of rebates or tax credits, to help those consumers weather the storm.  Another idea, from DFL members, would be to expand Minnesota Care especially in areas of Greater Minnesota where consumers are facing fewer choices and narrowing provider networks.

Minnesota Care is a low-premium plan subsidized by a tax on medical providers. DFL lawmakers had earlier proposed expanding eligibility for that program, but also introducing high premiums to help support it.

Some of the longer term solutions for stabilizing the individual insurance market were passed by the Minnesota Senate in 2015, but gained no traction in the House.

That year the legislature did pass a bipartisan bill that instructed Gov. Mark Dayton to seek a federal waiver that would allow consumers to get federal subsidies without going through the MNsure exchange, because dealing with local agents and brokers was easier at the time than navigating the website's dashboard.

Dayton did seek the waiver, but was instructed that the federal government doesn't want to consider it at this time. But even if such a waiver were granted it still wouldn't address the issue of the prices that insurance companies set.

Much of the angst at the Capitol has been directed at the MNsure exchange, and Republicans often refer to insurance rates as "MNsure rates" to further accentuate the link frustrated consumers make with an agency created by DFL lawmakers.

But in reality the rates are set by the insurance companies, and approved by the Minnesota Dept. of Commerce. MNsure is a web portal for shopping for private insurance plans, and checking on eligibility for discounts. 

"It's simply a website, where people can shop and compare," Sen. Sheran said. "To say that Mnsure is driving the cost of health care is the same as saying the website for buying airline tickets is driving the cost of airline tickets! No, the airlines set the rates."

Affordable Care Act

Much of the angst consumers are feeling in rooted in changes in the insurance industry brought about by the Affordable Care Act. Insurers are no longer allowed to deny coverage to those with preexisting conditions, or to apply lifetime caps to coverage.

The plans sold today much meet minimum requirement, to make sure basic preventative care is covered, including many tests and checkups that weren't covered in the no frills, high deductible catastrophic plans sold before the ACA.

Insurance carriers were suddenly selling plans to an older, sicker group of people in the individual market, and not enough younger consumers joined that market to create a pool of healthy people who buy coverage but rarely use it.

"The original rates offered by companies weren’t sustainable, they didn’t reflect the cost of care that the companies were covering," Sen. Tony Lourey, a Democrat from Kerrick, told reporters.

But Lourey, who was one of the architects of the MNsure exchange, said improving the system has been difficult in the political climate of the divided legislature, where state Republicans favor scrapping MNsure and national Republicans want to repeal the ACA.

"We just can’t throw out everything, all the progress we’ve made and turn our entire system over to the feds as some have called for; we need to keep what’s working and improve what needs improvement." 

Earlier in the week Gov. Dayton declared that the Affordable Care Act is no longer affordable for many, a quote that was tweeted and re-tweeted by Republicans across the nation, including Donald Trump.

The statement rang true for many who are in the individual market, including Francine Gersh of Golden Valley.

"My insurance company just sent me my renewal letter and said my already horrible plan will be getting much worse, and is going to cost me $1,886.30 a month," Gersh told reporters and lawmakers Friday.

"It’ll be a new network which excludes all of my doctors. It will however include an extremely complicated system of coverage with embedded deductibles, multi-layered tiers of co-pays."

She said even under the current plan she had to pay $4,000 out of pocket for treatments her husband was prescribed for dry eye syndrome, because Health Partners denied payment. Gersh said the HMO would not allow her to apply that out-of-pocket cost to her annual deductible. 


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