Uninsured Minnesotans in the Twin Cities can expect to pay as little as $91 a month for health care coverage bought through MNsure, the state's new online marketplace.
State officials released cost and coverage details today, though people won't be able to shop for insurance until Oct. 1, when the website goes live.
"We believe that ... these rates that we're announcing today undeniably are extremely competitive," Minnesota Commerce Department Commissioner Mike Rothman said. His department regulates insurance products.
Initially, state officials were not going to release details on the MNsure plans until Oct. 1. But to drum up interest in the exchange, officials convinced health plan executives to make that information available earlier.
Rothman said that Minnesota has the lowest average rates in the country compared to plans offered on 11 other exchanges. A total of 141 plans for individuals and families will be offered on MNsure, and 63 plans will be available to small businesses.
Premium rates vary by region, age and smoking status.
So, if you're a 25-year-old non-smoker living in the Twin Cities, you can pay $91 a month for a "bronze" plan, the cheapest option on the exchange, which must cover 60 percent of an average individual's medical costs.
But if you're a 60-year-old in the Twin Cities and want a more robust "platinum" plan, which covers 90 percent of medical costs, you'll see a list price of about $408 a month.
Rates get more expensive if you're buying for an entire family or for employees in a small business. And if you're under 30, you may also qualify for a catastrophic plan, which is cheaper than the least expensive bronze plans.
Those costs are before federal subsidies are taken into account.
"Many individuals and small businesses through MNsure will get even lower cost coverage," said MNsure Executive Director April Todd-Malmlov. She said roughly half of the people who use MNsure will be eligible for the subsidies.
Subsidies are available for people with annual incomes of $23,000 to about $46,000. For a family of four, the income range is $47,100 to $94,200. Government health plans are available for people making less.
BROAD COVERAGE, SKINNY NETWORKS
At least two insurers will be selling their products in every part of the state. In some places, including the Twin Cities metro area and parts of northern Minnesota, people will be able to choose plans from five insurers.
That's a good thing because there are a lot of people in greater Minnesota who don't have insurance, said Terry Hill, executive director of the National Rural Health Resource Center, based in Duluth.
"The access to insurance is going to be expanding and there's going to be additional support for making that insurance affordable," he said. But Hill is worried that networks available in the plans have left out many rural clinics - facilities that rural Minnesotans count on for primary and comprehensive care.
"It's definitely conceivable that somebody in a remote area of Minnesota will have to travel somewhat of a distance to access the providers that are covered by their insurance plan," he said.
APPLES AND ORANGES COMPARISON
Rothman was asked repeatedly if consumers would be saving money in the MNsure marketplace, but said that comparison hadn't been done.
"These are very competitive rates compared to what [people on the individual market] have today," he said.
To some degree, it's an apples and oranges comparison because plans sold on the exchange will look very different than plans now sold on the individual market, Todd-Malmlov said. Deductibles will be capped and each plan has to include a specific set of benefits.
In Minnesota, the average list price for 40-year-old non-smoker would be $154 a month, nearly $50 lower than in Maryland, which also has low rates.
Jean Abraham, a professor at the University of Minnesota's School of Public Health said the rates released today are lower than she expected. The prices may be low because insurance companies want to lure new customers, she said.
"It could be an attempt at getting market share," Abraham said. "We know that for this population, they may not have a lot of experience shopping for health insurance, and we know that lower income individuals tend to be more price-sensitive."
It didn't take long for both Democrats and Republicans to start spinning the numbers. State Rep. Joe Atkins, who sponsored the House bill that created MNsure, said the rates indicate the theory behind the exchange is working: private insurers are competing for customers, and that is driving down the cost of insurance.
"When I went into this, I had some pretty high expectations - that it would drive up quality and drive down prices. That's what competition does," said Atkins, DFL-Inver Grove Heights. "This knocked my socks off."
Republicans say that Minnesotans will be paying more on MNsure than they would otherwise for health insurance.
"How does making health insurance more expensive encourage more people to get insured?" asked state Rep. Joe Hoppe, R-Chaska.
Atkins said Minnesotans will get more bang for their buck.
"You can go on einsurance.com and buy insurance, and you can buy a piece of crap," Atkins said. "You're buying something that's not worth buying."
This table shows who qualifies for government help with insurance according to family size and annual income. Eligibility is based annual income, calculated as a percentage of the federal poverty rate. MinnesotaCare, for example, is available to people whose income is between 133 percent and 200 percent of the federal poverty level. Federal tax subsidies to help with the cost of regular insurance are available for an individual whose annual income ranges from about $23,000 to about $46,000. For a family of four, the income range is $55,000 to $110,000.
|Household size||100% FPL (Federal Poverty Level)||133% FPL||200% FPL||275% FPL||300% FPL||400% FPL|
|For each additional person add:||$4,020||$5,347||$8,040||$11,055||$12,060||$16,080|
|Medical Assistance: up to 133% (FPL)||Minnesota Care: 133% - 200% FPL||Subsidies through instant tax credits: 200% - 400% FPL|
|Medical Assistance for all children and pregnant women: up to 275% FPL|
Editor's note: This report has been modified from the original to correct the eligible income range for a family of four. Due to an editing error the original story listed the range for a family of five.