Continuing the Health Insurance Reinsurance Program

The Senate Commerce Committee approved a proposal Tuesday, February 12, that would extend the Minnesota Premium Security Plan, which reinsures insurance providers. The program was created in 2017, setting aside $542 million dollars to offset the steep health insurance premium increases that faced Minnesotans in the individual market. Without an extension, that program will expire in 2020.

Author of SF 761, Senator Gary Dahms, R-Redwood Falls, told committee members that the individual health insurance market has been in decline and healthier Minnesotans have not been purchasing insurance. "...because as your market gets less and less healthy people, the costs of the coverage goes up, and that's the purpose of the reinsurance, to reduce the cost of insurance and to make the market whole and to try to keep the healthier people in it..."

Laura Sayles of the Minnesota Nurses Insurance said that the reinsurance program is not a "game changer" in the goal of reducing health care costs. "The reinsurance program does nothing to reduce the cost of care. Instead, it artificially reduces the cost of premiums," she said.