MNsure officials laid out figures Wednesday under which the exchange would put $10 million into fixing its website this year and the organization would become self-sufficient in 2015, as required by federal law.
Next year’s $39.7 million budget does not seek additional funding from the Legislature, but it relies on getting federal approval to carry over $5 million in grants to fill a shortfall created by lower-than-expected enrollment in private health plans.
MNsure leaders say they feel confident that federal officials will allow the state added flexibility to hold on to the last slice of a package of two-year grants totaling $155 million. Those funds were originally earmarked to build the MNsure system and to staff and operate the agency in its first year.
Officials said they could still balance the budget even if they aren’t allowed to use the federal grant to plug the budget gap.
By law, MNsure is required to submit a preliminary 2015 budget to state lawmakers before March 15. A final budget will be presented in October.
The two-year budget figures were discussed in broad strokes at a MNsure board meeting Wednesday. The board deferred detailed decisions about reallocating funds and other line items until after the end of open enrollment on March 31.
Adjustments to the current year’s budget come as enrollment has fallen shy of anticipated levels, and the state has had to hire 100 additional call-center operators to guide consumers through the process.
To date, more than 118,600 Minnesotans have signed up for a health plan through the MNsure website. But the mix of enrollees is different than expected: Fewer people have used the new online marketplace to buy private insurance while more have enrolled in Minnesota’s public health programs, Medical Assistance and MinnesotaCare.
The discrepancy affects the budget in a meaningful way, because MNsure collects a fee from insurance companies based on the premium price of private health plans sold on the commercial market.
But MNsure has been able to reduce some costs, mainly through staff reductions and a less-costly marketing campaign. It also doesn’t expect to spend as much on navigators, who help people find coverage, mainly because fewer people used them.
In all, MNsure identified about $18.5 million in savings this year that can be redirected to customer service and improving the MNsure website and IT system.
“They’re not aspirational reductions,” Wes Kooistra, MNsure’s deputy director of operations, told the board. “They’re reductions based on what’s happened so far.”
By rejiggering the current budget, MNsure could spend $10 million to fix underlying problems with the MNsure system that have given consumers headaches and made for a clunky handoff of information to the insurance companies. Another $2.5 million would go to the call center.
The board didn’t discuss details about reallocations for IT support, and putting that money to a different use also requires federal approval. But the intent would be to spend the funds this year both to hire a new lead vendor and to overhaul the complex computer system that taps into various state and federal databases to determine eligibility for public programs and tax credits.
MNsure is bracing for a rush of traffic in coming weeks as consumers face a March 31 deadline to purchase insurance or face a tax penalty. Consumers who don’t buy coverage by then will not be able to buy private insurance until Nov. 15, though there are some exceptions for certain “life events” that cause a change in insurance. Some of those situations include changing jobs, moving, getting married or divorced or having a baby.
Improving enrollment numbers will remain vital for MNsure to meet its budget goals in the years ahead, when it won’t have government grants as a safety net.
The 2015 budget assumes that average monthly premiums will be about the same as they are this year — about $290 per person — and that about 100,000 people will buy coverage.
At the meeting, several community workers raised concerns that the budget appeared to slash money allocated to navigators, who have been trained and certified by MNsure to get the word out to the uninsured in hard-to-reach communities such as rural areas, immigrant communities and among those who are homeless, in need of mental health services or disabled.
“More people need [help] than realized,” said Teri Breton, a navigator and St. Paul resident. “It is a complicated thing to get insurance, to buy insurance and to get Medical Assistance or MinnesotaCare. It is like doing my taxes, that so many people need help with.”
Department of Human Services Commissioner Lucinda Jesson also urged the board to budget cautiously but be generous with navigator funding. A conservative approach to the navigator budget would be a “self-fulfilling prophesy at this point,” she said.
Under the proposed 2015 budget, the navigator outreach effort would actually grow by $4 million, MNsure officials stressed, but the line item was confusing because of initial assumptions about how many people would use navigators.
Original estimates assumed that 50 percent of enrollees would work with a community-based navigator, when only 12 percent have done so to date. Next year, officials believe more navigators will be working in communities and more people will know about them. They expect that about 25 percent of enrollees will work with navigators to sign up for insurance on MNsure next year.