Premiums in Minnesota's troubled individual market won't spike as much next year as they did for 2017, according to numbers released Monday, but already high rates will get even higher if a new state program fails to win federal approval.
The state's largest health plans for individuals are seeking average rate increases ranging from 3 percent to 32 percent for next year, the Commerce Department said.
Proposed increases would be significantly reduced or transformed into discounts, state officials added, with a "reinsurance" program that is designed to provide a financial cushion for insurers that happen to attract high-cost enrollees.
Minnesota's individual market is far from being out of the woods, insurers say, but Monday's release pointed to small signs of improvement.
"It does seem like relative to previous years, the Minnesota market is seeing some signs of stabilizing," said Cynthia Cox, a researcher who follows the individual market for the California-based Kaiser Family Foundation. But she added: "There could be some pretty big premium increases in the absence of reinsurance."
The individual market primarily serves people under age 65 who are self-employed or don't get coverage from their employer. Most Minnesotans don't buy individual health insurance policies, since employer groups and government programs cover the vast majority of residents.
The market has been the focus of changes with the federal Affordable Care Act (ACA), which in 2014 started to prohibit health plans from denying coverage to people with pre-existing health problems. The federal health law also called for the launch of new health insurance exchanges like Minnesota's MNsure as an option for individuals who buy their own insurance.
Minnesota's individual market has been volatile under the ACA, with lawmakers agreeing to spend $542 million over two years on reinsurance after the market nearly collapsed last summer. At the time, the state's largest insurer pulled its most popular products from the market, and health plans sought premium increases of 50 percent or more.