Minnesota health plans propose higher premiums for small businesses

Minnesota's largest health insurers for small businesses are proposing average rate increases next year of between 3 percent and 12 percent, according to numbers released Friday by state regulators.

The report from the Minnesota Department of Commerce also shows that Minnetonka-based UnitedHealthcare, the nation's largest health insurer, is following through with plans announced last year to enter the state's small group market in 2019.

Groups with 50 people or less buy coverage in the market, which had been shrinking for more than a decade before seeing a sudden rebound in enrollment last year to about 310,000 people. Insurers attributed the increase to consumers likely fleeing premium jumps in the state's individual market.

"Proposed rates for small group market health plans apply to coverage purchased by employers with 2-50 employees," Commerce said in a statement posted on its website.

Final rates with more details including particulars on the network of doctors and hospitals in each health plan will be released by Oct. 2, Commerce says. Compared with 2018 rates in the small group market, carriers with relatively large shares of the market are seeking a range of average increases.

Depending on the product line, Eagan-based Blue Cross and Blue Shield of Minnesota is seeking an average rate increase of 5.6 percent to 9.3 percent. At HealthPartners, average increases could range from 3.8 percent to 5.7 percent.

The average rate increase being sought by Minnetonka-based Medica is 11.9 percent, while the average requested increase is 3 percent at the largest division of Golden Valley-based PreferredOne.

Commerce will review whether the proposed rates are justified both by the benefits that consumers receive and the ability of insurers to pay expected medical claims costs based on premium revenue.

"An estimated 5 percent of Minnesotans currently get their coverage through the small group health insurance market," Commerce said in a statement. "Employers purchase the coverage through insurance brokers/agents or directly from the insurers."

Christopher Snowbeck • 612-673-4744 Twitter: @chrissnowbeck