Minnesota’s congressional delegation is calling for quick federal approval of a state program to moderate premium increases next year in the individual health insurance market.
Earlier this year, state lawmakers created a “reinsurance” program to help stabilize the market in Minnesota that primarily serves people under age 65 who are self-employed or don’t get health insurance through their employer.
The program is contingent on federal approval, however, and the chief executive of the state’s MNsure exchange told a U.S. Senate hearing earlier this week that action is needed “in the next few days.”
State law calls for the public release of final 2018 health insurance rates in the market by Oct. 2, yet those rates will look substantially different depending on whether the reinsurance program moves forward.
“This matter is urgent because the Minnesota Department of Commerce must imminently finalize approval of the individual market rates,” according to the Sept. 14 letter signed by the state’s two U.S. senators and eight members of the U.S. House of Representatives.
“Accordingly, on behalf of our constituents, we urge you to complete your consideration of Minnesota’s waiver application as soon as possible,” says the letter to Steven Mnuchin, the Treasury secretary, and Tom Price, the secretary of Health and Human Services (HHS).
A spokeswoman for HHS offered no comment Friday on the letter.
Minnesota lawmakers have called for spending $271 million in each of the next two years to fund the reinsurance program, which the state Commerce Department says will lower premiums by about 20 percent from where rates otherwise would fall. The program offers a financial safety net to health insurance companies by covering a portion of costs for enrollees with unusually expensive health care problems.
If the reinsurance program is approved, average premiums charged by Minnesota’s largest individual market insurers for 2018 actually would decline next year in many cases, according to proposals made public in late July. In some cases, the proposed average rate cuts would exceed 10 percent, although one insurer might still assess an average increase of up to 11 percent for some customers.
Without the reinsurance program, the range of proposed premium changes in Minnesota would shift upward significantly to between 3 percent and 32 percent.
Minnesota is seeking approval for the program under the federal Affordable Care Act, which has brought sweeping changes to the individual market.
When the changes kicked in during 2014, premiums for individual coverage sold through MNsure were among the lowest in the country. Rates since then have skyrocketed, however, and regulators say the market for 2017 nearly collapsed.
“The governor and both Democratic and Republican leaders strongly support this effort to address premium costs and access to affordable health care in our state,” says the letter to Mnuchin and Price.