On Monday, the Minnesota Senate passed an extension of the Minnesota Premium Security Plan, also known as ‘reinsurance’. The bill, which passed with bipartisan support, awaits action by the House of Representatives.
“Over the past two years, the Minnesota Premium Security Plan has successfully lowered health insurance premiums for thousands of Minnesotans who purchase insurance on the individual market,” said Senator Jerry Relph (R-St. Cloud). “Extending the reinsurance program will ensure premiums remain affordable and the individual health insurance market remains solvent.”
The legislation, Senate File 761, would extend the Minnesota Premium Security Plan, originally authorized in 2017, for an additional three years. The Minnesota Premium Security Plan is a medium-term market stabilization program that uses state dollars to cover a portion of high-cost claims, allowing health plans to better moderate costs and rein in premiums. The program is expected to positively impact all 160,000 Minnesotans who purchase their health insurance on the individual market. In addition, the bill would also strengthen reporting requirements to help legislators and the public better understand program operations.
In 2018 and 2019, most Minnesotans purchasing health insurance on the individual market saw double-digit percentage decreases in premium rates. Without a reinsurance program, health plans projected premium increases of more than 20 percent – an unsustainable increase that would potentially leave many counties without a single option and cripple the individual market. The reinsurance program ensures at least one insurer offers health insurance coverage on the individual market, with all but four counties having at least two insurers offering plans.
“Minnesota’s ‘reinsurance’ program has become a useful tool to stop the steep increases Minnesotans had been facing on their insurance bills. It has become a model for states across the country to bring insurance markets back from the brink of collapse,” Senator Relph continued. “We’re looking to continue bringing the costs of health insurance down for thousands of Minnesotans – and that’s what this bill does.”
Senator Jerry Relph, of St. Cloud, represents District 14, including Benton, Sherburne, and Stearns counties, in the Minnesota Senate.