Senator Newman, Minnesota Senate approve plan to continue successful insurance affordability program
The commitment comes after the reinsurance program has delivered on its promise of improving access and affordability for health care consumers
(St. Paul, MN) – The Minnesota Senate on Monday approved legislation to extend Minnesota’s successful reinsurance program for another year. Extending the program ensures insurance rates in the individual market will remain stable, and without any additional cost to the taxpayers.
In his recent budget proposal, Governor Tim Walz did not reauthorize this successful program. The state risks destabilizing the individual health insurance market, drastic increases in premium costs, and could lose approximately $90 million in federal money if the program expires.
“Reinsurance is what reversed years of double-digit health insurance premium increases,” said Sen. Scott Newman (R-Hutchinson). “MNsure caused the individual market to nearly collapse, but reinsurance saved it and lowered costs for thousands of families. I have no idea why Gov. Walz would cut a program that received national recognition for being so successful, but Republicans in the Senate will make sure it continues to receive funding.”
The original $542 million for operations was offset by federal funding and the federal dollars will continue through 2022 with this extension. Reinsurance has been proven so effective it is being implemented in several other states across the nation.
Obamacare left states with few options to maintain the stability of the private insurance market. As a result, insurance premiums for the individual market increased by double digits several years in a row, with some premiums spiking as high as 49%. Many counties only had one insurance company to choose from.
Reinsurance was one of the primary tools that Minnesota, and subsequently other states, used to rescue the individual market. As a result, Minnesota continues to enjoy some of the lowest rates in the country, every county has at least two providers, and a new provider has started offering plans in the state. If reinsurance were to be defunded, private insurance could fall back into the same chaos as before, opening the door to single-payer, government-sponsored health care.
The reform, which was first implemented in 2017, has been lauded by both local media and national news outlets and used as a model by a number of other states.