Insurance may cost less here, but will plan holders save?ST. PAUL — A new way to buy health insurance could provide some Minnesotans with the lowest premiums in the country, state officials said Friday as they announced figures for the plan.
By: Don Davis, Forum News Service
ST. PAUL — A new way to buy health insurance could provide some Minnesotans with the lowest premiums in the country, state officials said Friday as they announced figures for the plan.
The officials were unable, however, to compare the new prices to what consumers pay today.
Gov. Mark Dayton’s administration promoted a comparison showing Minnesota to be the lowest of 17 states that have announced premiums in new marketplaces established as part of the Affordable Health Care Act.
“I’m here today with good news for Minnesota consumers,” Commerce Commissioner Mike Rothman said.
April Todd-Malmlov, executive director of the newly formed state insurance marketplace, known as MNsure, echoed that, saying: “Coverage is going to become much more affordable for a million Minnesotans.”
Republican lawmakers did not see the announcement in such glowing terms.
“These rates are higher than what is currently available on the open market, and even with promises that health-care reform will bring more affordability, it seems we were sold a bill of goods,” said Senate Minority Leader David Hann, R-Eden Prairie, a former Senate health-care committee chairman.
The health insurance marketplace will begin selling policies offered by existing private insurance companies on Oct. 1. Policies will become effective Jan. 1.
Most Minnesotans receive insurance through their employers, and most are not expected to be affected by MNsure.
However, those who buy insurance privately or are on government-funded programs such as Medical Assistance (Minnesota’s version of Medicaid) or MinnesotaCare can use the mostly online marketplace.
Insurance premiums will be subsidized by the federal government for anyone earning less than four times the poverty rate, $94,200 annual income for a family of four.
Some examples MNsure gave for the lowest premiums of basic policies:
Minnesotans with incomes below $15,282 receive free health insurance under Medical Assistance. Those earning up to $22,980 qualify for reduced-premium MinnesotaCare. Those with incomes up to $46,960 receive federal assistance to lower their cost.
More than half of Minnesotans probably will receive federal tax credits to reduce insurance cost, Todd-Malmlov said.
Insurers offer policies with four levels of coverage.
Employers with fewer than 50 workers and individuals will be able to use MNsure. Each Minnesotan will have at least two insurance companies offering policies on MNsure.
Five companies will use MNsure to sell policies from the Twin Cities’ north to St. Louis County. Western Minnesotans will have four companies vying for business, while parts of northeastern and south-central Minnesota will have three companies. The southeastern portion of the state will have the fewest companies offering policies.
Rothman said people in areas with fewer insurance companies offering policies probably will pay higher premiums.
Officials said better health insurance policies will be available next year. But they said the new policies will be so different that they cannot say if Minnesotans actually will pay less.
Sen. Tony Lourey, DFL-Kerrick, called MNsure “a step forward,” adding that it is impossible to compare today’s privately purchased insurance policies with those soon to be available because federal law made so many changes in what policies must cover.
The new policies will be “better value, better products,” said Lourey, Senate author of the bill authorizing MNsure. “You are going to be better off.”