Republican Jeff Johnson hammered on the Dayton administration's handling of MNsure Friday, in what has swiftly become a principal theme of his campaign for governor.
It was Johnson's third press conference on MNsure since the news earlier this week that PreferredOne, which offered the lowest rates and sold the most plans on the state health insurance exchange in the last year, is pulling out. Four insurance companies continue to sell plans on the site, but Johnson and Republican allies seized on the news as they try to take advantage of the Dayton administration's struggles to get MNsure operating efficiently.
This time, Johnson called for Minnesota's legislative auditor, a Capitol watchdog agency, to expand an ongoing MNsure audit to include a look at the Dayton administration's role in setting PreferredOne rates. Johnson said the situation "looks fishy," but was not able to offer any evidence or even specific allegations of wrongdoing.
"That's what we need to find out," Johnson said.
A day earlier, Dayton when asked by reporters said his administration did not dictate anything to PreferredOne. The company has made no allegations to that affect, either.
"The Commerce Department and the administration do not dictate to these companies what the rates are," Dayton said. "The notion that we set these rates is another one of the fallacies that those who are opposed to the system want to perpetuate."
While Johnson has tried to turn the MNsure issue against Dayton, the DFL has hit back against Johnson by highlighting some of his own past votes on health care. Specifically, Johnson acknowledged Friday that as a state legislator in 2003, he voted for a budget backed by then-Gov. Tim Pawlenty, a fellow Republican, that eliminated about 38,000 adults without children from state-provided health care coverage.
"That was a decade ago in the midst of a very deep deficit that we were in the middle of and that was part of the governor's plan to balance the budget without tax increases," Johnson said.
Earlier in his campaign, Johnson talked more frequently of scrapping MNsure altogether. He still says he'd seek a federal waiver from complying with the federal Affordable Care Act, but has also acknowleged that if elected he would likely have to continue to deal with MNsure.
"We have MNsure sitting in front of us and we have to figure out how to move on from that," Johnson said.
Jeff Johnson, the Republican nominee for governor, expanded his attack on Gov. Mark Dayton's record on health insurance and management of MNSure, the state's troubled health insurance exchange.
He appeared at Mack Engineering -- a small Minneapolis manufacturing company of machined components for companies such as John Deere and Honeywell – where co-owner Jennifer Salisbury said her company was experiencing skyrocketing health insurance premiums for the company and its 28 employees.
The company is an example of a small group insurance plan that is not in compliance with Obamacare because it does not meet mandated coverage requirements that are designed to give every person an adequate health plan. The Obama administration offered states more time to get small group plans in compliance, but Minnesota declined so that all employers would be treated the same, rather than having some in compliance and others not. Currently, 75 percent of small group plans are Obamacare-compliant.
Johnson said that by declining the extra time, Dayton had caused undue hardship on small businesses such as Mack Engineering.
“This is another example of Gov. Dayton hurting small businesses and their employees,” he said. “He wouldn’t stand up for the Mack Engineerings of Minnesota.”
Jeremy Drucker, a spokesman for Dayton’s re-election campaign, replied in a statement: “What Commissioner Johnson is proposing is to penalize the majority of Minnesota companies who are now providing improved health care coverage for their employees. They would be socked with higher insurance costs if the minority of employers…were allowed to continue to offer substandard plans.”
Drucker added that the cost increases cited by Johnson are due to improvements, such as requiring more comprehensive coverage and no longer allowing disqualification for pre-existing conditions.
Anne O’Connor, a spokeswoman for the Commerce Department, said an analysis showed that continued noncompliance would increase costs for groups in compliance between 6 and 10 percent. That's because the non-compliant plans would sweep up the healthiest, cheapest customers, thereby increasing costs for everyone else.
Johnson may sense an opening this week on health care related issues as MNSure faced another setback. PreferredOne, which offered the lowest rates and had signed up nearly six out of 10 consumers who shopped on the online marketplace, announced it was pulling out of the exchange, which led to speculation that rates could increase as its customers seek alternative coverage.
Republican U.S. Senate candidate Mike McFadden said the withdrawal of the largest insurer from MNsure, the state’s health care exchange, is evidence of the Affordable Care Act’s failure, blaming President Obama and his opponent, Sen. Al Franken, for enacting what he called a broken system.
PreferredOne was the top-selling insurer on MNsure, but its CEO said they’d be pulling out of the exchange, saying their participation was “not sustainable.” PreferredOne insured six out of 10 MNsure consumers who now will have to seek out other providers and may result in higher healthcare premiums.
“I’m a businessman, and as a businessman I know that when someone provides 60 percent of the market and is the low-cost provider drops out of the program, you’re going to see a significant increase in premiums. This doesn’t work.” McFadden said, pointing to a chart from the Hoover Institution that illustrated the tangle of functions that make up the ACA. “I’m very disappointed in President Obama and Sen. Franken because this program has been based on lies.”
The biggest of all, he said, is that Obama care decreased the cost of insurance in the country. PreferredOne’s withdrawal is proof of that, he argued. However, he said he does not believe the insurance company should be held responsible for leaving MNsure. He remained focused on a system he said could be fixed by a “state-based, market-based, patient-centered” system that allows consumers to buy their insurance across state lines.
Franken spokeswoman Alexandra Fetissoff said that because of the ACA, 95 percent of Minnesotans are now insured, while the state’s uninsured rate has been halved.
“Mike McFadden would repeal the health law and take us back to a time when women were charged more for health coverage simply because they were women, people with preexisting conditions were denied coverage, half the bankruptcies in this country were connected with health care emergencies and young adults couldn't get covered under their parents' plan,” she said in a statement. “Once again, Mike McFadden has proven that he would rather jump at the opportunity to play politics than actually solve problems.”
McFadden made his statements on the day the Franken campaign launched another ad claiming McFadden’s investment firm, Lazard Middle Market, was involved in a merger that moved an American pharmaceutical company to Ireland to avoid paying U.S. taxes.
McFadden called the ad “patently false,” saying his firm did not represent the company that made the inversion, and that Franken praised a similar move by Medtronic to new headquarters in Ireland. However, while Franken praised the move as a potential job-creator, he also said the it "needs careful scrutiny."
McFadden said he said companies leave the country because they lack the tax incentives to stay.
“What this is evidence of is you have a president and a Democratic senator and a Democratic Senate that don’t understand tax policy and haven’t done anything over the last six years to make the United States have a competitive tax climate.” he said.
Republican candidate for governor Jeff Johnson blasted Gov. Mark Dayton on Tuesday for what he called "breathtaking incompetence," after it was revealed that the insurance company that sold more policies on MNsure than any other is pulling out of the exchange.
MNsure officials confirmed Tuesday that PreferredOne, the choice of nearly six in 10 consumers who have bought plans on the exchange, would no longer participate. Insurers are expected to release their 2015 MNsure rates in early October.
"Mark Dayton was desperate to be the first governor in the country to implement Obamacare in Minnesota through MNsure," Johnson said at a Capitol news conference. "He got to handpick his board and handpick his staff and it has been an unmitigated disaster since day one."
Johnson suggested that PreferredOne pulled out because it was offering artificially low rates on its plans under pressure from Dayton's administration. Jeremy Drucker, spokesman for Dayton's re-election campaign, called that ridiculous.
"Of course, administration officials encouraged insurers on MNsure to provide the lowest rates possible to the people of Minnesota," Drucker said. "However, the companies were solely responsible for the rates they decided to offer."
Dayton has owned up to MNsure's struggles. He apologized to consumers who struggled to buy coverage through the glitch-ridden website, and earlier this month he called MNsure's troubled launch the single biggest disappointment of his first term as governor.
Johnson said if elected, his first goal would be winning a federal waiver that would allow Minnesota to pull out of conforming to the Affordable Care Act. If that's not successful, Johnson said, he would seek to replace MNsure's board of directors and its leadership staff. He also said he'd try to increase competition among those companies selling plans on the site.
Drucker predicted that if Johnson is elected, he would seek changes that undermine MNsure's mission of boosting insurance coverage rates.
"This would be devastating to Minnesotans," Drucker said.
Standing in front of DFL Gov. Mark Dayton's temporary Capitol area office, Republican gubernatorial candidate Jeff Johnson said he would try to reverse the massive unionization of child care and home health workers now underway in Minnesota if he became governor.
"I would certainly try," Johnson said. "It would be hard to reverse but not impossible."
Republicans, including Johnson, have long hammered on Dayton and DFLers in the Legislature for approving a measure to allow child care and home health care workers to decide whether to unionize. The resulting unions would negotiate with the state.
The controversial 2013 legislative vote was a top priority for the Service Employees International Union, which is working with home care workers, and the American Federation of State, County and Municipal Employees, which works with child care workers.
Last month, home health care workers approved unionization. Child care providers are organizing a unionization vote for next year.
Johnson and anti-unionization activist Jennifer Parrish, a child care businesswoman, both suggested that Dayton's support of unionization was "payback" for union support and contributions during the 2010 election.
Although a quid pro quo of support in exchange for administrative action could be illegal, Johnson said he was not accusing Dayton of any illegal activity.
Jeremy Drucker, spokesman for the Dayton campaign, declined to comment on Johnson's accusation of payback. But he did say the governor believes in child care providers' right to organize.
"Governor Dayton supports giving child care providers the chance to hold an election and decide for themselves whether or not they want to form a union. This right was guaranteed by the U.S. Congress in 1935," Drucker said in a statement.
Dayton, who has been in Minnesota politics for decades, has long been considered union-friendly and during his term and campaign has received significant support from Minnesota unions. He has not always, however, moved in lock step with union interests and before the 2010 primary, many unions supported one of his Democratic opponents.
Jennifer Munt, a spokeswoman for AFSCME, said Johnson position shows he is "against working women."
As to the accusation of "payback," she said "we support candidates who support workers...for us that is our fundamental value."
Updated to remove photo and fix a typo.
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