Minnesota Democrats want to create a public health insurance option [Pioneer Press]

Democrats say they’re going to make Minnesota one of the first states with a public option for health insurance as part of a broader effort to make health care more affordable.

House Majority Leader Rep. Jamie Long, DFL-Minneapolis, is chief sponsor of a bill that would allow any resident to purchase health insurance through MinnesotaCare, now the state insurance program for the working poor. The program was created 30 years ago and uses the federal framework of Medicaid to provide low-cost insurance.

“This bill will lead to reductions in the uninsured, underinsurance and in uncompensated care,” Long said during a Wednesday news conference. “It’s time we finally provide affordable health care to all Minnesotans.”

Three states — Washington, Colorado and Nevada — offer some type of public health insurance option.

Where Democrats see an opportunity to help the roughly 4 percent of the Minnesota’s 5.7 million residents who are uninsured, Republicans and some health care providers see unknown costs and unforeseen impacts on care networks.

They say government insurance programs have reimbursement rates for health care services that are too low. They also question whether a public insurance plan would be as comprehensive as private insurance.

“The MinnesotaCare rates of reimbursement are not enough to cover costs,” said Rep. Anne Neu Brindley, R-North Branch, when the legislation was discussed before the House commerce committee. “Right now, the private plans, the commercial plans pick up that difference to ensure that our providers can continue to function.”

Expanding MinnesotaCare would mean more patients receiving services at lower rates. The state would either have to spend more on subsidies or providers would have to charge private insurers more to fill the gap, Neu Brindley said.

“I worry about what we will do to our provider pool when we are likely decreasing their (overall) reimbursement rates,” she said.

Mary Krinkie, vice president of government relations for the Minnesota Hospital Association, expressed similar concern. She noted that about 62 percent of hospital patients are currently on some type of government health insurance and commercial insurance typically pays up to twice the government rate to make up for it.

“This is why MHA is opposed to allowing individuals with higher incomes the ability to buy into MinnesotaCare coverage,” Krinkie told the House commerce committee Wednesday. “If eligibility is allowed to be broader without a reasonable income ceiling, current payment rates could jeopardize a sustainable health care system.”

Long noted fewer uninsured patients would lead to a reduction of uncompensated care and lower costs for providers.

Creating a public health insurance option has long been a dream of Democratic-Farmer-Labor Party members who now have narrow control of both chambers of the Legislature and the governor’s office. Democrats don’t yet have a cost estimate for the legislation.

Under their plans, immigrants who are in the country without proper authorization would also be eligible for health insurance. They are currently barred from public care programs and have to rely on emergency rooms for treatment.

Long’s bill also would launch a study of the best way to administer a public option for health insurance and how to deliver care in a way that’s cost-effective for patients and providers. MinnesotaCare is currently administered by private insurance companies that contract with the state.

MinnesotaCare is now restricted to people making less than $27,000 annually or $55,000 for a family of four. Under the proposal those caps would be eliminated and enrollees would be charged on a sliding scale based on their income.

Tavona Johnson, a home care worker from Austin, Minn., said her husband Dennis Kelly, who ran his own flooring installation business, found private insurance too expensive so he paid out of pocket when he needed care. That changed when he was diagnosed with colon cancer in 2020.

Johnson and Kelly then had to find insurance or pay tens of thousands of dollars a month for his treatment. The plan they found had premiums that were “astronomical” for substandard coverage and the couple had to drain their retirement savings.

“We had no choice. My husband had to have this life-saving treatment,” Johnson said.

Kelly died just over a month ago.

“The money he saved and planned to use for us to retire together is gone. We had to use it to cover those medical costs,” Johnson said. “The money intended for me to survive on after he was gone is no more.”

Dr. Katherine Guthrie, a family physician who works with the coalition of faith communities ISAIAH, said she’s seen the impact a lack of insurance can have on people. Some delay seeking health care until it is too late.

“No Minnesotan should have to pay for a lack of affordable health care with their life,” Guthrie said. “We can do band will do better.”

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