New plan targets the older uninsured

A new front has opened in the battle among Minnesota insurers to snag people left out of increasingly unaffordable traditional insurance plans.

Medica Encore is the latest in a flurry of attempts to tailor niche products to smaller segments of the market. It's the first plan to target 50- to 64-year-old early retirees who don't yet qualify for Medicare. Until now, most niche products had been aimed at young adults.

Medica estimates that there are 30,000 to 40,000 older Minnesotans who are uninsured because they retired early, were laid off or work for employers who don't offer group coverage.

"These are people who are accustomed to employer-based coverage and all of a sudden, they don't have it for some reason," said Craig Ashby, director of individual products at Medica.

The company is the state's third-largest health insurer, after Blue Cross Blue Shield of Minnesota and HealthPartners.

Medica Encore starts at $180 a month for a 50-year-old. It includes $400 for preventive care and a travel benefit that allows members to use a national network of providers. At that premium level, the deductible is $9,000.

There is no annual limit on prescription drugs, but there is a $5 million lifetime limit.

While Medica Encore is marketed to the early-retiree market, anyone between ages 3 months and 64 years may be eligible. The earliest date for enrollment is Sept. 1.

More seeking plans

Minnesota continues to have one of the lowest uninsured rates in the country, at 7.4 percent. But as employers pare back or stop offering coverage, more Minnesotans are shopping for individual insurance if they don't qualify for government programs.

The number of people who have individual coverage is up from 144,844 in 2003 to 192,355 in 2007, according to the Minnesota Council of Health Plans.

To attract customers who might otherwise go uninsured, health plans are offering niche products with pared benefits -- no maternity coverage, for example, and high deductibles -- in exchange for lower premiums.

Neither Blue Cross nor HealthPartners have immediate plans to introduce a direct rival to Medica Encore. Existing plans such as Simply Blue and Three for Free already attract a fair number of members from the early-retiree population.

Blue Cross is focused on having insurance brokers and customers understand existing plans rather than "adding confusion" to the market, said Laura Putnam, director of product management at Blue Cross.

HealthPartners recently introduced a new "plan finder" on its website that recommends a health plan once you enter your age and the benefits you most want.