'Reinsurance' bill is good for private companies' profits, and bad for Minnesota

Do you want taxpayers picking up the tab to pay back insurers?

Do you want taxpayers picking up the tab to pay back insurers? Star Tribune Elisabeth Flores

Minnesota lawmakers have disregarded rising healthcare costs hitting individuals, families, and our state.

Instead of addressing those costs, legislators chose to support a state-financed "reinsurance" program that will cost taxpayers hundreds of millions of dollars, and provides no long-term plan to control costs in the state’s health insurance marketplace, MNsure.

Under this reinsurance legislation, the state -- and not the patient’s insurance company -- will be responsible for all medical reimbursements between $45,000 and $250,000 for patients in the individual market. The reinsurance bill, which passed in both the state House and Senate on Thursday, is estimated to cost up to $600 million over two years, and includes no guarantee that insurance premiums or access to healthcare will improve for Minnesotans.

If the bill is signed into law, Minnesota taxpayers will improve profits for private companies, without cutting costs for patients suffering from complex chronic diseases, cancer, and other catastrophic illnesses. In short, this is bad health policy and bad for Minnesota.

Compounding this mistake, one proposed mechanism to fund the reinsurance plan is to redirect money away from the HealthCare Access Fund (HAF). The HAF supports MinnesotaCare, which provides medical insurance for some of our most vulnerable community members.

MinnesotaCare is substantially less expensive than the average plan in the individual market, covers as many people as the individual market, and is one of the most efficient and accountable insurance plans available. Instead of "reinsurance," the state could fully insure an additional 100,000 Minnesotans with MinnesotaCare for only around $200 million per year.

Under MinnesotaCare, premiums and deductibles would be substantially smaller than out-of-pocket expenses under reinsurance. This law would take money away from patients, patients who could be covered under MinnesotaCare, and use it to pay insurance companies. That's not consistent with most Minnesotans' priorities.

By passing reinsurance in its present form, the legislature made a clear choice: patients are not their priority.

As a group of Minnesota physicians working to decrease health disparities and expand healthcare coverage for all Minnesotans, we call on Gov. Mark Dayton to veto this legislation, and send a message to Minnesotans  about the state's commitment to patients.

It's a message our lawmakers could use. 

The authors are members of Minnesota Doctors for Health Equity; follow their organization on Twitter.