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New SHADAC Brief Explores the Impact of Federal Health Care Reform in MinnesotaFebruary 09, 2018:
A new brief from SHADAC deputy director Elizabeth Lukanen considers Minnesota’s health insurance market before and after passage of the Affordable Care Act (ACA) as well as the outlook for the state’s market given the current policy environment.
Minnesota’s Market before and after the ACA
The brief, “The Impact of Health Care Reform in Minnesota,” explores insurance coverage, public program generosity, insurance market regulations, and care quality and costs in Minnesota. Except in the area of costs, Minnesota had relatively high marks in these areas predating the ACA. Since the ACA went into effect, the state’s uninsured rate has declined further, although the cost of health care and coverage in Minnesota continues to rise, with a substantial number of Minnesotans (an estimated 50,000 to 70,000) foregoing coverage on the individual market between 2016 and 2017 due to costs.
Health Reform Today: Minnesota
The current health reform focus in Minnesota is the state’s individual insurance market, which state lawmakers have been working to stabilize following the exit of several major insurers. Lawmakers passed a premium relief bill in 2017 to assist consumers in the individual market with the cost of coverage. To further reduce premiums, the state established a state-funded reinsurance program that will reimburse insurers for 80% of insurance claims between $50,000 and $250,000.
Health Reform Today: The National Picture
There have been numerous attempts to repeal and replace the ACA since President Trump took office, but none has so far been successful. In the meantime, the Trump administration can significantly reform health care through other legislative vehicles and has taken steps to do so. Most recently, President Trump signed legislation overhauling the nation’s tax code that included a provision repealing the ACA’s individual mandate tax penalty. The impact of this particular change on the health insurance market as a whole—and the individual market in particular—is not yet known, but experts are concerned about the likelihood of healthier individuals choosing to opt-out of purchasing health insurance, leaving the market to support less healthy individuals.
Federal direction on health reform remains unclear, and this uncertainty may be taking a toll on coverage gains made under the ACA, with recent Gallup data showing an increase in the national uninsured rate since the end of 2016. In the face of federal uncertainty and the potential for coverage losses, many states, including Minnesota, are likely to continue to move forward with state-specific legislation to stabilize their individual markets and provide coverage for their residents.