New task force takes up potential MNsure changes

A new task force will take up some of the biggest potential changes to the state's MNsure exchange after lawmakers this weekend couldn't reach agreement on several competing proposals.

A massive spending bill for health and human services does not include House Republican plans to shift MinnesotaCare enrollees to the health exchange next year, nor does it include a Republican proposal to shut down MNsure in 2017.

DFLers in the Senate, meanwhile, didn't get their wish for MNsure to become more of a traditional state government agency. The MNsure board of directors will retain its authority, including choice of MNsure's top executive.

The final bill includes $500,000 for a task force to examine the future of MNsure, MinnesotaCare and the chance for federal waivers that could allow for a broad range of health care reforms.

Already passed by the Senate and House, the bill had not been signed Monday afternoon by Gov. Mark Dayton. In March, Dayton called for creating the health care task force.

"Often when you hear a task force or a commission, it means 'bury the issue,' " said Larry Jacobs, a political scientist at the University of Minnesota. "But I think this is actually a 'we-mean-business' sort of task force."

Minnesota launched the MNsure exchange in 2013 to implement the federal Affordable Care Act. The government-run marketplace suffered from a balky website and overwhelmed call center during its first year, and enrollment figures have continued to fall short of projections.

The track record prompted calls for change from both DFLers and the GOP, although the nature of reform proposals were very different.

Debate now moves to a 29-person task force that's required to provide a report to the Legislature by Jan. 15, 2016. Task force members will be appointed by the Senate, the House and Dayton and include representatives from MNsure and the departments of commerce, health and human services.

It will look at not just MNsure, but broader questions about funding the state's public health insurance programs. A top priority is the question of whether to combine MNsure and MinnesotaCare, Jacobs said.

MinnesotaCare covers people with incomes slightly above the poverty level — a group that's sometimes called the "working poor." It's a group that's one of the prime beneficiaries of health insurance exchanges in other states, where people tap tax credits to discount the cost of private insurance.

One reason state lawmakers have maintained MinnesotaCare is the program's benefit level for enrollees, which is richer than what's provided by most private policies.

"They're going to be looking at changing the generosity of the package for people in [MinnesotaCare]," Jacobs said of the task force. Moving program enrollees into the exchange "would make the MNsure private individual market viable," he said.

But any such change would be a fight. On Monday, the group TakeAction Minnesota — which is aligned with DFLers on many health care issues — was critical of changes in the current budget bill that ask MinnesotaCare enrollees to pay a greater share of current program costs. The changes save the state budget about $65 million over two years but include higher premiums for some in the program.

"TakeAction Minnesota will remain vigilant to any and all future efforts to jeopardize or dismantle this centerpiece of our state's health care infrastructure," the group said in a statement.

Beyond the task force, the final human services bill includes a House Republican proposal to let individuals obtain federal tax credits when buying coverage outside of MNsure. Currently, subsidies are limited to those who buy on the exchange.

To make the change, Minnesota would need a waiver from the federal government. Sen. Tony Lourey, DFL-Kerrick, questioned whether the Obama administration would grant such a waiver, which could reduce the number of people who buy through MNsure.

Rep. Matt Dean, R-Dellwood, said people buying outside of MNsure should have a shot at tax credits considering all the exchange's troubles. The troubled track record also explains a provision in the final bill, Dean said, that would let consumers appeal MNsure decisions about eligibility for public health insurance to district courts.

The state relies on the MNsure system to determine if people qualify for federal tax credits or the state's MinnesotaCare and Medicaid public health insurance programs. Medicaid covers residents with income near or below the poverty line.

As part of a highly critical report released in February, Legislative Auditor James Nobles recommended that the governor have the power to name MNsure's top executive — not the MNsure board. The provision was included in health spending bills from Republicans and DFLers prior into final negotiations but somehow didn't make it into the final legislation.

Why didn't lawmakers adopt more sweeping changes?

"It's a very controversial program," Dean said. "I think there's disagreement about what it would take to get it corrected for folks."

Republicans argue MinnesotaCare is unsustainable, particularly with a tax collected by health care providers that's scheduled to disappear in 2019. The tax has been a key source of funding for the program.

DFLers argue that MinnesotaCare has worked well for more than 20 years and should continue. Shifting enrollees to private policies on MNsure could subject them to unaffordable health care bills, supporters of the program say.

"MinnesotaCare is still an important piece of the health care future for Minnesota," Lourey said.

Christopher Snowbeck • 612-673-4744

Twitter: @chrissnowbeck