Future Of MinnesotaCare Remains Uncertain

April 30--The future of a health care program for low-income Minnesotans is at stake in the debate over how much the state should be spending in a year of a budget surplus.

The Minnesota House passed a bill Tuesday night that funds the health and human services department. It would eliminate MinnesotaCare, a health care program for people who earn too much for medical assistance but can't afford private insurance.

House Republicans have said state spending on health and human services is growing at an unsustainable rate. Their bill would make more than $1 billion in cuts, with the biggest portion -- more than $500 million -- coming from ending MinnesotaCare.

Opponents of the bill say it's unconscionable to cut a health program for the working poor when the state has a $1.9 billion budget surplus. They worry that MinnesotaCare enrollees might not be able to find similar coverage for the same cost, and could end up uninsured.

Minnesota is unique in offering a health care coverage option for people who earn too much for Medical Assistance, Minnesota's version of Medicaid. MinnesotaCare was created in 1992 and is aimed at people who earn between 133 and 200 percent of federal poverty guidelines.

About 105,000 people are enrolled in MinnesotaCare, including about 4,000 in Stearns, Benton and Sherburne counties, according to the state Department of Human Services.

Rep. Jim Knoblach, a St. Cloud Republican who chairs the House Ways and Means Committee, noted that the health care provider tax, which helps pay for MinnesotaCare, is scheduled to be repealed in 2019.

Under the Republican plan, MinnesotaCare enrollees would be transferred to MNsure, the state's health care exchange, and would receive a tax credit to help them cover the cost of insurance.

"We're not throwing these people off of health insurance," Knoblach said.

The additional enrollees also should help stabilize the struggling MNsure program and make it more sustainable in the long term, he said.

However, critics say MinnesotaCare enrollees could face steeper costs for coverage through MNsure.

"We remain concerned for this population of working poor, that they would still face higher deductibles, higher copays, higher premiums than they would on MinnesotaCare," said Wendy Burt, who represents the Minnesota Hospital Association.

If people don't get insurance through the exchange, they are less likely to get preventive care and more likely to end up in the hospital, Burt said.

"Hospital care, we know, is expensive. It's the most expensive place to seek care," she said. "We will still have people coming into the hospital but unable to pay the deductibles."

Many people in MinnesotaCare don't have enough income to afford coverage through MNsure, said Ralonda Mason, an attorney with Mid-Minnesota Legal Aid in St. Cloud.

"They're just right out of poverty," Mason said. "They're in a pretty precarious situation, and the amount of assistance that's available to them at that level is such that they really can't afford to purchase insurance through the exchange."

While a tax credit would help buy down the premium cost, they likely would wind up with insurance that has a higher deductible that they can't afford, Mason said.

"They end up with something they can't use," she said.

Republicans argue that health care spending is a longer-reaching problem that can't be ignored because of a one-time budget surplus.

Knoblach noted that health and human services now consumes about 29 percent of the state's budget, double the portion of 30 or 40 years ago. As a result, spending on higher education, property tax relief and other areas have gotten smaller, he said.

A conference committee will now have to work out differences between the House and Senate bills. The Senate bill does not contain the same cuts to health and human services.

Even if MinnesotaCare isn't eliminated this year, Knoblach said it's good that lawmakers are talking about the program's future.

"At least it gets the conversation rolling and has people starting to think about different alternatives," he said.

Follow Kirsti Marohn on Twitter @kirstimarohn or reach her by phone at 255-8746.

Total number of MinnesotaCare enrollees by county as of April 2, 2015

Benton: 737

Sherburne: 1,140

Stearns: 2,121

Source: Minnesota Department of Human Services.

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