House re-passes reinsurance bill as amended by conference committee

The state’s reinsurance program seems certain to continue after the House voted 106-25 on Thursday to pass a conference committee report that would reauthorize the Minnesota Premium Security Plan for five years and fund it at $890 million for three years.

Sponsored by Rep. Zack Stephenson (DFL-Coon Rapids) and Sen. Gary Dahms (R-Redwood Falls), HF3717/SF3472* is headed to the governor, who’s indicated he’ll sign it right away. The state has an April 1 deadline to reauthorize the program for its Centers for Medicare and Medicaid Services waiver.

Conferees completed their work earlier in the day.

“This bill is not everything I hoped it would be, but it is important because we have Minnesotans all over the state counting on us to make sure their premiums don’t rise out of control,” Stephenson said.

Reinsurance is designed to stabilize premiums in the individual health insurance market, which covers more than 165,000 people, by offering insurers a backstop for very costly medical bills. The state pays a portion of the bills rather than insurance companies raising premiums on everyone they cover.

Reinsurance means a 20-25% decrease in premiums, according to Commerce Department estimates.

Two requirements on insurance plans are included in the agreement.

Plans must cover post-natal visits at three weeks, 12 weeks and when recommended by health care providers between those times. And it would require plans include a flat rate co-pay drug benefit, thereby allowing people to spread out a co-pay for very expensive drugs over the year, rather than immediately pay up to their deductible.

Under the current system, some people may need to pay thousands of dollars for drugs in January or February and nothing the rest of the year because they’ve met their deductible, which can be challenging for people who may be living paycheck to paycheck.

Plans could drop the benefit if fewer than 75 people access it.

Provisions from the House bill not included in the final report would have sought alternatives to the reinsurance program. The conference report does not include funding and authorization for studies that would examine the impact of health care costs depending on how they are paid and a create a proposal for a public option.

Also absent is a board meant to ensure insurance plans meet mental health and substance abuse treatment parity requirements.  

“The provisions I supported in the House version are dropped in this version,” said Rep. Jennifer Schultz (DFL-Duluth) “We still have a bill that is a bridge to nowhere. We are spending $890 million to subsidize health plans and we still don’t have a solution to reduce health care costs.”

She said the state should be subsidizing the consumers to buy health insurance, not subsidizing the plans and added that reinsurance does nothing to reduce deductibles.