Does this look
familiar? This is the lead article from this week’s State Update, a newsletter highlighting
all the pertinent political and regulatory news at the state level. The State
Update is published the second and fourth Wednesday of every month. Be on the
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Minnesota lawmakers
agreed on a $890 million three-year extension of the state’s reinsurance
program, the Minnesota Premium Security Plan, just before the federal deadline
to pass such a measure. The version of the bill that initially passed the state
House included the establishment of a public option by 2025; this provision was
not included in the final version.
Reinsurance will be
extended in the Land of 10,000 Lakes for another three years, funded by $700
million from state coffers and $173 million shifted from a state healthcare
fund. Reinsurance programs have been proven to help states lower insurance
premiums for their residents, specifically those who access coverage through
the individual and small-group markets. Reinsurance programs are also a
much-needed beacon of bipartisanship in health policy across the country, a
policy area that can be highly polarizing in some state legislatures.
State-based reinsurance programs created through section 1332 waivers reimburse
issuers for a portion of provider claims that would otherwise be paid by some
consumers and by the federal government through higher premiums.
Reinsurance assists
approximately 163,000 Minnesotans who are on the individual marketplace as well
as 235,000 people who are insured through small-group plans. The Gopher State originally
passed reinsurance measures in 2017, then considered a temporary measure to
cool spiking premiums. However, five years later, reinsurance is still a
crucial component of the state’s health insurance markets, and lawmakers on
both sides agreed that failure to extend the program would result in higher
premiums for the aforementioned groups.
Although the size
and duration of the funding required to continue the reinsurance program was a
point of contention between Minnesota Democrats and Republicans, the main
points of contention were components that parties sought to add to the
reinsurance bill. Some Democrats wanted to attach a provision that would have
established a public option. The state House’s version of the bill would have
expanded the state’s Medicaid program – known as MinnesotaCare – to individuals
who make up to 200 percent of the Federal Poverty Level, as well as to small
businesses that want to contribute to their employees’ coverage. The public
option was not included in the final bipartisan agreement.
The reinsurance
agreement came on March 31, just one day shy of the CMS deadline for states to
inform the federal agency whether the program would be continued. More
specifically, the measure would authorize a five-year extension of the
reinsurance program but with funding for just three of those years. The plan
would also add some postnatal healthcare coverage for patients in the
individual market.
The Minnesota
Association of Health Underwriters played a vital role in getting this measure
passed, with 600 emails sent to state lawmakers urging them to provide
continued funding for the Premium Security Plan. |