Reinsurance plan lands before Dayton

The $542 million plan to assist health insurers with costly medical claims is in the hands of Gov. Mark Dayton after final action Thursday from the Legislature.

The House and Senate approved a bill to set up a reinsurance pool that health insurers can access next year. The vote was 74-57 in the House and 35-32 in the Senate, both controlled by Republicans. Supporters hope it reduces pressure on individual policy premiums for 2018.

The program would be contingent on a federal waiver, and state officials hope federal money will cover some of the cost. If it doesn’t, the money would be drawn from the state’s general treasury and a health-care account.

Rep. Joe Hoppe, R-Chaska, said lawmakers are coping with a health care predicament, and no one is happy about shelling out that much money.

"It is not a perfect bill. But I think it is a bill we should all vote for,” Hoppe said. “I think we should encourage the governor to sign, so we can help to try to stabilize the insurance market, the health insurance market for 2018."

Rep. Tim Mahoney, DFL-St. Paul, described it as a bailout for the insurance industry.

"We are just taking money from our taxpayers' pocket and giving it to insurers when they should be taking care of themselves,” Mahoney said.

Dayton, a DFLer, hasn't said whether he will sign the bill but has said insurers should have to guarantee premium relief and that they will continue to sell policies in Minnesota.

"I am disappointed that the GOP has decided to proceed with reinsurance without making these important changes to the legislation to ensure responsible use of taxpayer dollars," Dayton said Wednesday in a letter to lawmakers.

Dayton has three days after getting the bill, excluding Sunday, to decide.

Dayton's press secretary, Sam Fettig, said the governor will make full use of the available time.

“The Governor is reviewing the bill over the weekend with his commissioners and staff, and will make an announcement on Monday regarding his plans for the bill,” Fettig said.

Senate Majority Leader Paul Gazelka, R-Nisswa, said the bill “is a costly step I wish we didn’t have to make.” He said the answers Dayton and others are after are understandable but hard to promise because there are many moving parts. He said he’s confident rates will be lower with the reinsurance plan than if nothing was done.

“We’re blaming the health insurance companies and to me that’s a lot like blaming the referees in a big game that didn’t go well for us. They’re just taking in premiums and paying out losses,” Gazelka said. “We can make them be accountable and we want them to in every county. But they’re also not the main reason we have costs out of control.”

Lawmakers hurried the bill along because insurance companies are beginning to submit their proposed rates to state regulators over the next couple of months.

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