Changing Minnesota’s approach to health insurance wouldn’t be simple after years of work to establish the MNsure exchange.
Following a landmark U.S. Supreme Court decision last week, Republicans renewed their calls to dump the state’s MNsure system in favor of the federal government’s online marketplace for health insurance.
MNsure supporters countered the switch could be costly, and a bad fit with Minnesota’s large public health insurance programs.
Nevada, Oregon and New Mexico already have switched to healthcare.gov, and a fourth, Hawaii, is in the process of doing so, said Sabrina Corlette, director of the Center on Health Insurance Reforms at Georgetown University.
The court’s ruling upholding subsidies took away one key argument for maintaining a state-based exchange, she said, but that doesn’t mean all states should jump to the federal system.
“It’s not an easy decision,” Corlette said. “There is definitely some autonomy, some state control that you lose by shifting to healthcare.gov. … On the other hand, it may be financially a much more sustainable decision.”
A big reason states like Minnesota opted to create their own exchanges was to provide a “one-stop shop” for health insurance. The goal was to create one website where people could get coverage, whether they qualified for tax credits, Medicaid or Minnesota Care.
“The downside of going to healthcare.gov … is that it is much more challenging to try to integrate that with the unique state systems,” Corlette said.
In 2013, Minnesota was one of more than a dozen states to launch its own health insurance exchange as part of the federal Affordable Care Act. Exchanges are marketplaces where individuals can purchase policies from commercial health insurance companies.
The federal health law clearly allows for people buying through state-based exchanges to obtain federal tax credits that significantly discount premium costs.
Last week, the Supreme Court, in a 6-3 vote, rejected arguments saying those subsidies aren’t available to people buying through healthcare.gov.
Republicans said the ruling could prompt Minnesota to switch to a “federally supported state-based marketplace,” where the state would be responsible for performing all exchange functions except providing the information technology system. Consumers would apply for and enroll in coverage through healthcare.gov.
Another option, Republicans said, is a state partnership model, where Minnesota would continue to provide in-person assistance to consumers while handing off all other tasks to the federal government.
Rep. Tara Mack, R-Apple Valley, said the issue should be considered by a new state task force on health care finance that’s scheduled to generate recommendations by early next year on improving health care access and quality in Minnesota.
“I think we need to take a serious look at partnering, and going toward the federal exchange, in areas where it’s just working better … than it is on MNsure,” Mack said.
IT problems from the get-go
Minnesota received about $155 million in federal grants to launch MNsure, but the exchange suffered from a balky website and overwhelmed call center in the months following its launch in October 2013. There were significantly fewer problems during a second open enrollment period that started in November 2014, as MNsure added staff and improved its technology.
MNsure received $34 million more in federal grant money late last year, in part to fund ongoing fixes to the IT system. It continues to cause trouble for state and county workers who use MNsure for people enrolled in Medicaid and MinnesotaCare insurance.
The grant triggered Medicaid spending that takes the MNsure tab to more than $250 million, Republicans say.
The technology problems thus far at MNsure, plus the expense of trying to fix them, bolster arguments for exploring whether healthcare.gov is a viable option, said Peter Nelson, public policy director at the Center of the American Experiment, a conservative group in Golden Valley.
But there are a lot of unanswered questions about how it would work, Nelson acknowledged, saying: “I think we’re in a learning process.”
Last week, MNsure supporters were busy raising a lot of those questions.
Joe Campbell, a MNsure spokesman, argued that by giving up the exchange, Minnesota would lose the right to seek waivers under the federal health law that could allow for future innovations. Republicans and Democrats have put forward ideas for improvements under these waivers.
Brian Beutner, the former chairman of the MNsure board, said that the idea of moving to the federal exchange is a “great sound bite” that masks a more complicated reality.
All health exchanges in the country let consumers purchase commercial insurance policies, but MNsure also was built to replace the antiquated information technology system used in the state’s Medicaid and MinnesotaCare public insurance programs.
Many ongoing IT fixes at MNsure are focused on the “back end” system for these public programs, Beutner said.
“When you try to unscramble all that, I’m not sure it’s possible,” he said. “My guess is — purely speculative — that you’d be spending a lot of state money now to improve that back-end, rather than federal money.”
Minnesota could move to the federal exchange for people buying commercial policies, said Thompson Aderinkomi, a former MNsure board member. But he added: “We would still need MNsure to do Medicaid eligibility.”
Mack said she agrees that the IT system for public programs must be fixed, and she has questions about how they would connect with the healthcare.gov system. But she said other states that have switched to the federal exchange apparently are building off the federal system for their public programs.
Waivers could be a better way to improve the system, Mack said, but it’s not clear which ones would be granted by the federal government.
The “one-stop shop” idea behind MNsure is a great concept, Mack said, but the exchange’s track record so far suggests that it’s too ambitious. “The reality,” she said, “is that we are so far from it being what it was supposed to be.”