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 lookout for the State Update in your in box!

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.