In the book Pawlenty writes about health care and his efforts to reduce costs in Minnesota.
He writes that he wanted to cut costs and improve results, and encourage competition by getting consumers more involved in making decisions.
Among the examples Pawlenty mentions is the Minnesota Advantage Health Plan, a program that offers lower co-pays and deductibles to state employees who visit hospitals, doctors and clinics that provide high-quality health care at a low cost.
“State employees overwhelmingly chose care from lower-cost, high-quality providers – and premium increases in the program have been relatively small or flat for five years,” he wrote on page 177.
Parts of Pawlenty’s claim are correct. But there are some caveats.
Under the Minnesota Advantage Health Plan, the state ranks health care providers according to efficiency and cost. Employee co-pays and deductibles are lowest for providers that are ranked as offering high-quality health care at low cost. Less efficient providers are ranked at higher cost levels and enrollees pay more to visit them.
Doctors, clinics and hospitals compete to be in the lowest cost category and, as a result, get more business. For the state and its employees, the program has meant lower health care costs.
So, Pawlenty’s characterization of the program is on point, as is his claim about the program’s popularity. Currently, about 85 percent of state employees are visiting low-cost, high efficiency providers, according to Minnesota Management and Budget.
It’s also true that in 2006, 2010 and 2011, insurance premiums did not increase.
In some years, however, Advantage premiums did go up. A summary from Pawenty’s office points out that these increases were frequently lower than “other large Twin Cities employers.” (The summary doesn’t say which employers or how many.)
But to say these increases were “relatively small” is somewhat misleading. In several instances, the average Advantage premium increase was more than the national average, according to a recent budget department analysis.
For example, in 2005, Advantage premiums went up an average of 15.1 percent compared to the national average of 9.2 percent. In 2007, the Advantage average went up 9.9 percent compared to the national average of 6.1 percent. However, overall Advantage health care premiums have been on the decline in recent years.
There’s also one key point to make about Minnesota Advantage that may be lost on readers of Pawlenty’s book: He didn’t start the program. Rather, Minnesota Advantage was the result of negotiations between state employee labor unions and management; it was launched in 2002, the year before Pawlenty took office.
That said, bargaining between labor and MMB continued during the Pawlenty administration, and further changes were made to the program that have helped make Minnesota Advantage more cost effective.
It was close, but the PoliGraph rates this claim as accurate.
Pawlenty is correct that many Minnesota Advantage participants have chosen low-cost, high-quality providers. And he’s right that premiums haven’t increased at all in some years.
That said, it’s important to note that while premium increases have been on the decline in recent years, they have spiked higher than the national average in some instances. Furthermore, Pawlenty does not make clear that Minnesota Advantage actually started before he took office in 2003.
Courage to Stand, by Tim Pawlenty
Summary of changes to the state employee health plan under the Pawlenty administration
Office of the Legislative Auditor, State Employee Health Insurance, Feb. 2002
Minnesota Management and Budget, Minnesota State Employee Group Insurance Program: Biennial Report, 2007-2008, accessed Jan. 21, 2011
Minnesota Management and Budget, Minnesota Advantage Health Plan 2011, Benefits Schedule, accessed Jan. 21, 2011
The Council of State Governments 2004 Innovations Award Program, Application Form from Minnesota Advantage Health Plan, accessed Jan. 18, 2011
Minnesota Association of Professional Employees Letter to President Barack Obama, Feb. 22, 2010
Interview, Alex Conant, spokesman, Gov. Tim Pawlenty
Interview, Barbara Holmes, Assistant Commissioner and State Labor Negotiator, Minnesota Management and Budget, Jan. 20, 2011
Interview, Jim Monroe, Executive Director, Minnesota Association of Professional Employees, Jan. 18, 2011
Interview, Peter Benner, Former Executive Director, American Federation of State, County and Municipal Employees Council 6, Jan. 18, 2011