Wisconsin and New Jersey are Among the States Looking To Copy Minnesota Model Of Using Federal Funds To Lower Insurance Premiums

Minnesota capitol
by Evie Fordham


Several states including Wisconsin and New Jersey are seeking to copy Minnesota’s model of federal reinsurance program funding that contributed to a 13-percent drop in premium rates in the state from 2017 to 2018.

The Minnesota legislature adopted the program, which uses mostly federal funds to help insurers cover people with medical bills typically between $50,000 and $250,000, in 2017, reported Kaiser Health News. The program enables insurers to lower premiums and is a policy encouraged by the Trump administration.

Daily Caller News FoundationWisconsin Republican Gov. Scott Walker is focusing his campaign on his health care accomplishments, including support for his state’s reinsurance program, reported RealClear Politics. He says premiums will be 11 percent lower than they would have been without the program in 2019, reported HealthLeaders Media.

Minnesota’s 2018 reinsurance program received $131 million from the federal government, and many other states have applied or are applying for reinsurance program funding. Alaska and Oregon have programs similar to Minnesota’s in place. The main difference between Alaska’s program, which started in 2016, and other states’ is that Alaska’s covers all costs for people with “highest-cost conditions.”

Wisconsin and Maine were approved in July, while Idaho, Louisiana, Maryland and New Jersey are working toward having programs set up by 2019, reported KHN.

Critics of the program warn that the slashed premiums will only last as long as heightened federal funding does, reported KHN.

“That initial decrease is meaningful, to be sure,” health policy researcher Matthew Fiedler of the Brookings Institution told KHN. “But other steps are needed to help stabilize the exchanges.”

Critics also say the state-by-state nature of reinsurance programs can lead to confusion. Tennessee Republican Sen. Lamar Alexander and Washington Democratic Sen. Patty Murray sponsored a health care bill that included a $30 billion “reinsurance pool,” but it failed in 2017.

“A sustained federal approach would be much preferable and what we’d like to see,” legislative and regulatory policy executive Kris Haltmeyer of insurance giant Blue Cross Blue Shield Association told KHN.

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Evie Fordham is a reporter at Daily Caller news Foundation. Follow Evie on Twitter @eviefordham.












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