Health insurers are hiking premiums and limiting enrollment in Minnesota's individual market next year, with regulators saying the emergency measures were needed to avert a market collapse.
The moves are a clear sign that the market for some 250,000 people who buy coverage for themselves is dysfunctional and needs reform, said Commerce Commissioner Mike Rothman during a Friday news conference.
While rate increases of more than 50 percent aren't fair to consumers, Rothman said, things could have been worse. He described a period this summer when all health insurers in the state seemed prepared to abandon that segment of the market.
"We tirelessly worked, together with the insurers, to pull the market back from the brink with temporary solutions for this year," Rothman said. "We succeeded in saving the market for this year, but the result is not pretty."
The premium jumps and enrollment caps are confined to the individual market, where about 5 percent of state residents buy coverage. The market includes the MNsure exchange and has undergone significant changes with the federal Affordable Care Act.
Minnesotans covered by employer plans, Medicare and other government programs aren't affected. For those in the individual market, the premium increases announced continue the pain after two years of rate hikes.
Premiums will jump by an average of 50 percent to 67 percent, depending on the insurer. Regulators also are taking the unusual step of letting most health plans limit the number of enrollees they'll cover.
The caps will pressure consumers to shop early during the coming open enrollment period, since some plan options could disappear once insurers hit their limits. And regulators say the policies being sold for next year will feature tighter controls on the doctors and hospitals that enrollees can use.