Individual health insurance news better than a year ago
ST. PAUL — Minnesotans who do not have employer or government funded health insurance received good, but not great news when state officials released 2018 premiums rates they will pay.
Most individual insurance premiums will remain about the same as this year when Minnesotans can start buying them in a month, but many say the rates already were not affordable. About 112,000 who benefited from a 25 percent discount funded by state taxpayers this year (averaging $136 a month) will not see that rate cut again next year.
"The individual market survived a near-fatal crisis last year, but its recovery is still very tentative..." state Commerce Commissioner Mike Rothman said Monday, Oct. 2, in announcing 2018 insurance rates. "Today there may be no red lights, no siren, but you could say there is still a big flashing sign that says 'caution.'"
Rothman also announced rates for businesses with fewer than 50 employers, which also showed near static rates.
Fewer than 4 percent of Minnesotans get insurance through the individual market, while 5 percent have coverage from small businesses.
Most people are insured by large-employer provided policies or government-funded care such as Medicaid (known as Medical Assistance in Minnesota), Medicare or MinnesotaCare. Monday's announcement did not affect those health care plans.
A year ago, many individual insurance rate increases hit 50 percent. State legislators and Dayton responded by establishing the 2017 25 percent premium discount program.
People who received state discounts this year will pay a hefty increase next year as the rate cut disappears.
Rothman said the increase will vary by individual next year, but probably will range from the mid-20 percent to low 30 percent. The 2018 rates are about 20 percent lower than they would have been because of a new state and federally funded plan known as reinsurance that is designed to help pay for the most costly patients.
MNsure CEO Allison O'Toole said that federal subsidies, separate from the reinsurance plan or the state discount, average more than $7,000 a year, but officials estimate that 100,000 people eligible for the federal aid did not apply.
Residents of most counties will have more than one insurance company offering policies, but only Medica will sell in Kittson, Roseau, Lake of the Woods, Todd and Meeker counties.
Two insurers — Blue Plus and Medica — will sell policies to most western and southern counties, while most east-central and northeastern counties will have access to UCare, Medica and Blue Plus.
Five central Minnesota counties and most in the Twin Cities will have three insurers.
Rothman said rates announced Monday will not change through 2018, although some have questioned whether the federal money really is locked in.
"As a practical matter, right now everything is locked and loaded," Rothman said.
Most people who get individual policies are farmers, the self-employed and early retirees. Individual policies go on sale Nov. 1 from private insurance agents and the state-run MNsure website. In mid-October, MNsure plans to provide Minnesotans with web-based tools to compare different policies.
Examples of premium rates Tuesday provided by the state-run MNsure insurance sales site showed differences around the state.
MNsure says that a family of four in Duluth, earning $69,000 a year, would pay $1,444 a month for a mid-priced insurance policy next year, compared to $1,567 this year. However, federal subsidies available on MNsure would reduce the premium by $927 next year, a bit less than this year.
A single person making $25,000 annually in Pipestone would pay $392 a month next year, down from $448 this year. However, after federal aid is figures, the actual payment would be about $124 monthly in 2018.
A 61-year-old Detroit Lakes resident making $40,000, meanwhile, would pay $1,075 monthly next year, after paying $1,182 in 2017. With federal aid factored in, the 2018 payment drops to $445.
Federal aid, only available from MNsure, is available to single taxpayers earning about $48,000 or less and families of four with about $94,000 and lower income.