Health insurance rebate money not going fast in Minnesota

The state of Minnesota is on pace to distribute far less in health premium rebates than lawmakers allotted earlier this year.

Minnesota Management and Budget (MMB) said Friday the state received requests for rebates worth about $47 million during the first four months of the year.

At that rate, the state would spend about $144 million on rebates this year — short of the $312 million that lawmakers set aside in January for the rebates and a related audit.

"We're reserving final judgment until July 15 on whether we believe there will be money left," said Keith Hovis, a spokesman for MMB.

The rebate program provides a 25 percent discount on insurance premiums throughout 2017. State law requires MMB to determine by July 15 whether the available appropriation will be sufficient for subsidies equal to 25 percent of the gross premium for the entire term.

The rebates are available only for certain people who buy in the individual market, where fewer than 5 percent of state residents get coverage. It's the market for people who are self-employed or don't get coverage from an employer or the government.

In January, Republican legislators passed and DFL Gov. Mark Dayton signed into law a measure providing rebates for individual market shoppers who make too much money for federal tax credits but are facing premium jumps of more than 50 percent.

Premium rebates from the state have been provided upfront to consumers by health plans, which subsequently seek reimbursement.

"It's wonderful to see so many Minnesotans getting help in 2017," said Jim Schowalter, chief executive of the Minnesota Council of Health Plans, in a statement. "I remain worried about how 100,000 people who dropped out [of the market] are paying for the care they need."

MMB on Friday said about 105,000 people tapped rebates during the first four months of the year.

State Republicans argued the tally is bigger than the 90,000 people that health insurers projected earlier this year would take advantage of the program.

"Democrats' embrace of Obamacare brought the individual market to the brink of collapse — Republicans responded by passing premium relief and reforms to stabilize the market and begin to undo the damage," said Rep. Greg Davids, R-Preston, in a statement.

Lourey blamed "Republican intransigence" for delaying creation of the program until late January, at which point open enrollment for 2017 had nearly concluded.

"Had we passed this in October, it would have actually stabilized the market in much better fashion," Lourey said.

Dayton and Republican lawmakers sparred last year about whether to call a special session of the Legislature to create the premium rebate program among other measures.

In the end, Dayton never called a special session, and Republicans passed legislation for the rebates in late January.

A spokesman for House Republicans on Friday questioned via e-mail whether Lourey had evidence to back up the assertion.

Christopher Snowbeck • 612-673-4744