Last Session The legislature created two programs to tackle the problem of skyrocketing individual health insurance. The Premium Subsidy program gave people on the individual market a 25% rebate on their premiums. The Premium Security program gave money directly to insurers to help buy down rates. Both of those programs are now ended as they were meant to provide temporary relief and stabilization of the health insurance market. As it turns out, not all of the money was spent so one of the very first items in the Governor’s supplemental budget this year is what to do with that money. The Premium subsidy money is going to a new program Dayton is proposing called the Minnesota Care Buy-in. The buy-in program would cost $58.3 M in the 2020-2021 Biennium.
That wouldn’t be enough to cover it, however, so there are some other revenue streams getting captured to go in it. One is the provider tax which funds Minnesota Care already, but which was set to sunset. Dayton proposes to remove the sunset. Also, there is leftover money from MCHA, the now-closed high-risk pool plan.
Minnesota Care was created during the Pawlenty administration to tackle the problem of uninsured Minnesotans who had no health coverage through an employer and who could not afford individual premiums. These people were working poor, not eligible for Medical Assistance or Medicaid. Many farmers, whose incomes fluctuate during the year-end up using Minnesota Care. With MNSure serving roughly this same clientele, there have been some proposals to scrap it. Even the Federal Government sees it as redundant to the Health insurance Exchange. With pressure from farmers, that idea got put aside.
Meanwhile, the legislature has a bill HF3543 (Davids) SF 3392 (Chamberlain) That would tweak MNSure.
- It would reduce the amount MNsure could collect from 3.5 percent to 2 percent, beginning in January 2019. This MNSure Tax is what partly funds MNSure. Since premiums have skyrocketed, this has had the effect of swelling the amount this tax collects. Lowering the premium tax as this bill does is estimated to save Minnesotans $30M.
- It would amend requirements for health plan certifications, allowing for more flexibility and potentially more plans to be eligible plans in Minnesota.
- It would require the Commerce Department to submit waivers to the federal government to allow individuals receiving tax credits to shop for health plans outside the marketplace; and
- It would require health carriers to take the MNsure tax into account when setting health and dental plans for 2019
On March 13, The House Commerce and Regulatory Reform Committee approved the bill on a 13-5 party-line vote, sending it to the House Health and Human Services Finance Committee. This week, on March the 27th, Senator Chamberlain presented it to the analogous committee in the Senate. In both committees, the DFL members championed the Governors’ Minnesota Care buy-in plan instead.
There are other bills that would give tax credits for individual premiums that don't qualify for the subsidy and one, from Rep. Gruenhagen that would re-establish MCHA so there are other ideas floating around that could be incorporated into a new health insurance fix. Without the Federal Government's action (and baring an unlikely 10th amendment health insurance law revolution) whatever action the state takes will require another round of federal waivers.
The Governor and the Legislature's approaches couldn't be more different, and it remains to be seen what will happen and what kind of relief people in the individual market can expect this session.