Monday, October 3, 2016

qotd: Ask Minnesota if the individual insurance market is stable

September 30, 2016
Individual health plan premiums to jump at least 50 percent in Minn.
By Christopher Snowbeck

Health insurers are hiking premiums and limiting enrollment in Minnesota's individual market next year, with regulators saying the emergency measures were needed to avert a market collapse.

The moves are a clear sign that the market for some 250,000 people who buy coverage for themselves is dysfunctional and needs reform, said Commerce Commissioner Mike Rothman during a Friday news conference.

While rate increases of more than 50 percent aren't fair to consumers, Rothman said, things could have been worse. He described a period this summer when all health insurers in the state seemed prepared to abandon that segment of the market.

The premium jumps and enrollment caps are confined to the individual market, where about 5 percent of state residents buy coverage. The market includes the MNsure exchange and has undergone significant changes with the federal Affordable Care Act.

Premiums will jump by an average of 50 percent to 67 percent, depending on the insurer. Regulators also are taking the unusual step of letting most health plans limit the number of enrollees they'll cover.

The caps will pressure consumers to shop early during the coming open enrollment period, since some plan options could disappear once insurers hit their limits. And regulators say the policies being sold for next year will feature tighter controls on the doctors and hospitals that enrollees can use.

The premium hikes and enrollment caps amount to a "finger in the dike" that's meant to buy time while the state figures out what to do, said Jim Schowalter, chief executive of the Minnesota Council of Health Plans, a trade group for insurers.

"What I think no one really appreciated until today was the trouble that the insurance market is in," Schowalter said. "This announcement is another sign that how people are getting their own insurance isn't working."

"These rising insurance rates are unsustainable and unfair," Rothman said. "Middle-class Minnesotans, in particular, are being crushed by the heavy burden of shouldering these costs."


Comment by Don McCanne

We keep hearing that ACA is working as intended, that all we need to do is enroll more younger, healthier individuals in the plans and all will be well. Ask the people in Minnesota how it is going. And they certainly are not the only state with problems.

Our politicians on the one hand tell us that all we need is a couple of patches, and on the other hand tell us that we should dump the system and let the markets work. Well, the system is not amenable to patches - we need comprehensive reform of the financing infrastructure - and the market cannot possibly work when prices far exceed the discretionary income of most of those who need health care.

The current patches in Minnesota include large premium hikes, and allowing the insurers to put limits on the total number of enrollees. Those patches might help the insurers, but for patients they make insurance less affordable and less accessible. Wasn't reform supposed to take care of patients?

Regular readers know what would work - a well designed single payer national health program. Everyone would be covered by a system that would be affordable for each one of us. Minnesota should be leading the way on this.