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January 18, 2019

10/15/2015 11:49:00 PM
SE MN seeks help on highest health care premiums in State

by Ken Haggerty

A crowd of about 60 people gathered in Cannon Falls at the Cannon River Winery on October 8 seeking answers at a Health Policy Summit on why Southeastern Minnesota residents have to pay so much more in health care insurance premiums (surcharges near 50% for some plans) than anywhere else in the State.

The Cannon Falls city council and Economic Development Authority, which gets constant complaints from current and potential business owners on the higher rates in Cannon Falls versus just across the border in Dakota County, had asked Senator Matt Schmit, whose district includes much of the high-rate area, to help convene the Summit.

Lucinda Jesson, Commissioner of the Minnesota Department of Health and Human Services; Tom Major, of the Minnesota Department of Health Managed Care Services; Larry Johnson, Director of Government Relations for MnSure; Peter Brickwedde, Director of Government Affairs for the MN Department of Commerce; and Dr. Tom Witt, CEO of Mayo Clinic Health System for Cannon Falls, Lake City and Red Wing all sat on the panel and gave some thoughts on the topic and addressed questions from the audience.

Steve Dabelow of Cannon Falls, who handles a lot of small group health insurance plans in the region and across the State, said some of the State approved rates, which are divided into nine regions, carry a 48 higher premium in Goodhue County compared to Dakota County.

Dabelow asked why any business owner would locate in the Cannon Falls industrial park (Goodhue County rates) versus going just five miles west to Randolph's industrial park in Dakota County. Dabelow called on the State officials and Schmit to work on ways to retool the rate formula to make it more equitable.

State officials said the lower population in the SE Minnesota pricing region, lack of competing health care plans, and the presence of only one major health care provider, Mayo, that is a world class provider, are all factors in the higher rates.

Mayo's Witt said they are frustrated as anyone over the divergence of rates between the metro and the southeast in recent years, saying they have kept cost increases at 3% or less over the last few years.

Dabelow noted Governor Dayton said the entire State would benefit from the new Vikings stadium and thus pushed for financing plans in which the entire State carried the cost burden of the $1 billion structure, not just the Metro. Dabelow said similarly the entire State benefits from the great services that the Mayo makes available and that thus the entire State should help cover those costs.

Cannon Falls business owner Julie Disch (Hi-Quality Bakery) said she didn't want to speak, but was so upset about the higher prices she and her husband pay she couldn't keep silent. Disch said her premium of $500 a month would be about $200 lower in the Metro or about $100 lower in Northfield. Disch said she supports Mayo and all the great work they do, but said that she uses hospitals in the Cities and doesn't feel she should have to pay premiums based on Mayo Clinic rates.

Multiple audience members asked for boundaries to be redrawn to include a higher population for risks to be spread out over a larger region. New Affordable Care Act laws are attempting to make rates "Community-based," to encourage health care providers to improve the overall health of entire communities, and hopefully lower costs in the long run.

The MNDHS's Jesson said new laws have also made more competitive bidding for Government health coverage, which it thinks has created some savings.

The State officials trumpeted that group rates for 2016 are flat to slightly higher, but conceded group rates have been sharply higher in past years. Individual plan hikes for 2016 are certainly concerning the State officials said.

State officials also trumpeted the high rankings of the Minnesota health care system on a national and even world-wide basis, and noted that under the new laws the number of insured residents is now near 97%. In the long run, it is hoped fewer uninsured people will mean lower rates for all.

Audience members asked the panelists to look for ways to blend some of the markets, commercial and private, to maybe help lower rates. Audience members also asked for legislation more friendly for self-insured small groups of as little as ten members.

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