Delegation’s Democrats seek fix for MinnesotaCare funding formula

WASHINGTON – The seven Democrats in Minnesota’s congressional delegation have asked the Obama Administration to reconsider a proposed rule that they say would lead to much lower levels of funding for MinnesotaCare, a state-subsidized health insurance program that is expected to cover 140,000 Minnesotans in 2014.

Minnesota currently stands alone among states in offering what’s known to policy wonks as a Basic Health Plan, an insurance program for the working poor who who make between 139 percent and 200 percent of the federal poverty level. Those making less than that amount are eligible for Medicaid while those making more tend to have fewer problems affording health insurance. The program was established in 1992 and more than 90 percent of its costs are currently paid for by the federal government as part of the Affordable Care Act.

Lawmakers and officials are concerned that the federal reimbursement for MinnesotaCare premiums will be based on the premiums health insurers are offering for plans on MNsure, the state’s health care marketplace. Those premiums were lower than expected -generally a good thing for consumers and taxpayers- but it means that MinnesotaCare’s federal reimbursement could fall short of projections.

The Minnesota Department of Human Services estimates that gap could reach $517 million by the end of fiscal year 2017.

As the lawmakers put it in a letter to Secretary of Health and Human Services Kathleen Sebelius: “the future of MinnesotaCare would be jeopardized by CMS’s recently proposed funding methodology that does not take into account the unique market conditions created by decades of health care innovation in our state.”

The lawmakers have a short window of time to influence the administration. The rule is set to be finalized by March.

You can read the letter here.