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Column: MNCare Buy-In would hit locals hard

By Barb Haley, Minnesota District 21A representative

Addressing the rising health care costs Minnesota families face is a top priority of mine. In 2017, we passed an emergency premium relief refund program, as well as a reinsurance bill to help stabilize the individual insurance market. In 2018, it's critical that we continue our efforts to lower costs and ensure access — particularly in rural Minnesota.

To that end, I've been pursuing legislation this session to address the disproportionately high health insurance rates in our area. Insurance ratepayers in rural Minnesota experience significantly higher costs than those in metro areas, with southeastern Minnesota bearing some of the state's highest costs.

My bill would request an Office of the Legislative Auditor study to analyze the underlying reasons for these disparities, and subsequently make recommendations on legislative actions to reduce or eliminate these cost differences. People buying health insurance on the individual market — farmers, small business owners, retirees, and others — have suffered skyrocketing healthcare costs, and this bill is a critical step toward long-term solutions to this crisis.

In recent weeks, numerous constituents have contacted me with questions and opinions on Gov. Mark Dayton's MinnesotaCare Buy-In proposal. This would be an expansion of the current MNCare program (which provides nearly free health care for our state's most needy) by removing income restrictions and thus allowing anyone to purchase state-sponsored coverage. While I understand this proposal's appeal to those buying their own insurance and without employee-sponsored health plans, I do not believe it would fix the health insurance rate increases or actually lower healthcare costs.

The Governor's Office recently estimated that this proposal would cost an average of $659 per month for individuals. In addition to these high premiums, the governor's budget indicates that it would require over $110 million in start-up costs, and millions more in ongoing costs. With the enormous costs the proposal requires, it would surely involve taking funding from other important budget areas, such as education and transportation. We can't afford to waste more taxpayer money while families struggle.

Also, from 2014-2016, the Department of Human Services failed to accurately bill tens of thousands of MNCare enrollees. Because the amount of uncollected premiums is estimated to exceed $30 million, I am wary of using taxpayer dollars to expand an already ineffective system. Furthermore, given MNSure's troubled history, adding more people to a broken insurance enrollment system raises concerns.

Many important details about the MNCare Buy-In option remain unknown. Among other details, we still lack clear information on deductibles, co-pays, caps on amounts individuals would pay, and network availability.

For all the uncertainties surrounding the proposed MNCare Buy-In, one thing is clear: the proposal calls for very low reimbursement to hospitals and providers, limiting their reimbursement to Medicare rates.

The fact is that Medicare reimbursement rates are extremely low compared to private insurance plans, meaning hospitals and clinics would see their reimbursement reduced significantly for patients covered by the MNCare Buy-In option. In addition, because the rates are so low, few providers would be likely to accept the public option as a form of insurance. Thus, the proposal would likely end up limiting access to care.

The proposal's low reimbursement rates would be most acute in rural Minnesota, because our populations are generally older, sicker and mainly covered by government programs. In our area, for example, Medicare and Medicaid plans account for 56 percent of patients in Red Wing and Lake City, and account for 68 percent in Cannon Falls, and 64 percent in Wabasha.

An expansion of MNCare would then further increase these percentages and result in fewer patients covered by private insurance and, most importantly, decreased reimbursement for providers. Decreased reimbursement has the potential to lead to limiting services, rationing of care and eventually hospital closures, resulting in decreased access in rural areas already experiencing higher costs. For our area, hospital closure means driving nearly an hour to Rochester or the Twin Cities for routine doctor visits.

Because of enormous budget costs, low reimbursement rates for providers and the looming threat of local hospital closures, the MNCare Buy-In would be a disaster for Minnesota. As we wait for solutions and flexibility from the federal government, I will continue working with my colleagues to pursue meaningful reforms and initiatives to reduce costs and increase access quality care.