Nearly 116,000 Minnesotans lost health insurance over the past two years, marking an abrupt turnaround in health coverage gains that began after enactment of the Affordable Care Act (ACA), according to a state study released Tuesday.
Minnesota's uninsured rate hit a record low of 4.3 percent in 2015 when more people got coverage through federally subsidized private insurance or because of higher income eligibility limits for the Medical Assistance program for the poor.
But in 2017 the uninsured rate rose to 6.3 percent, fueled by a decrease in the number of employers who offered coverage as well as people who exited the individual market, where health premiums took a big jump in 2016.
Uncertainty over the future of the federal health law, with some national surveys finding that half the population mistakenly believes the ACA has been repealed, also could be driving people away from seeking coverage, the state Health Department said.
Still, there were fewer people without health insurance in 2017 than in 2011, when 9 percent of state residents were without health coverage when the federal health law started to take effect.
However, the recent jump in the uninsured is the largest increase in the state since 2001.
"It is particularly concerning that we are seeing a decrease in health insurance coverage of this magnitude during a time of economic growth and low unemployment," said Stefan Gildemeister, state health economist at the Minnesota Health Department.
Health officials are concerned that the swelling number of those without health insurance will have spillover effects, contributing to higher rates of illness and taxing the resources of the health care safety net.
"We know the impacts of people going without access to regular sources of care," said Jan Malcolm, state health commissioner. "It is not that people don't want health coverage but they have lost access to affordable coverage."
In a survey of 12,000 Minnesotans conducted by the University of Minnesota School of Public Health, many of those interviewed said they lost access to health care coverage because they changed jobs or were no longer eligible.
More than half who lost coverage said they couldn't afford to keep their policy or couldn't afford to buy a new one.
"It really is a crisis," said Gary Wertish, president of the Minnesota Farmers Union. "Health care costs have been going up for a long time."
Many farmers are squeezed between higher health care costs and lower farm incomes, leaving them few options but to drop health insurance altogether in order to cut costs.
"It is very risky to not have health insurance," Wertish said. "It is really similar to senior citizens that are choosing between pills and having to buy food."
According to the state study, 100,000 fewer Minnesotans bought individual health insurance the past two years compared with 2015. Although that sector of the market has always been small in Minnesota, the Health Department said it has shrunk to the lowest level it has ever recorded, accounting for 4.4 percent of those with insurance.
Last year, the Legislature authorized premium rebates and a reinsurance program to help lower premium costs, but the full effect of those efforts has yet to be seen.
"It may keep people enrolled, but it may not be enough to help bring people back who are going without care," said Jim Schowalter, chief executive of the Minnesota Council of Health Plans, which represents that state's insurers.
The state study found that nearly 23 percent of the 350,000 people without insurance would be eligible for premium subsidies if they had shopped for a policy on the state's MNsure insurance exchange.
"Many of the people without insurance right now could get help paying for premiums," Schowalter said. "That is an important message for anybody who makes under $48,000 a year — look to see if they can get help because they probably can."
More employers, especially small businesses, have stopped providing health insurance to their employees altogether, another factor driving up the uninsured rate.
"Some have dropped coverage altogether which is not a good option for anybody," said Bentley Graves, director of health and transportation policy for the Minnesota Chamber of Commerce.
Between 2013 and 2016, nearly 7,000 Minnesota small businesses stopped offering coverage, Graves said.
"Health insurance is a very important benefit to attract and retain talent," Graves said. "These small employers are at a greater disadvantage in a very tight labor market."
The Legislature passed laws last year that will make it easier for some small employers to self-insure, giving them more flexibility over benefits, and that will let them pay employees to buy insurance on their own.
"Hopefully those two changes will help some, but ultimately this really comes down to the cost of health care and cost of insurance," Graves said.