Saturday, October 8, 2016

Near ‘Collapse,’ Minnesota to Raise Obamacare Rates by Half

Near ‘Collapse,’ Minnesota to Raise Obamacare Rates by Half

Minnesota will let the health insurers in its Obamacare market raise rates by at least 50 percent next year, after the individual market there came to the brink of collapse, the state’s commerce commissioner said Friday.

The increases range from 50 percent to 67 percent, Commissioner Mike Rothman’s office said in a statement. Rothman, who regulates the state’s insurers, is an appointee under Governor Mark Dayton, a Democrat. The rate hike follows increases for this year of 14 percent to 49 percent.

“It’s in an emergency situation — we worked hard and avoided a collapse.” Rothman said in a telephone interview. “It’s a stopgap for 2017.”

On average, rates in the state will rise by about 60 percent, said Shane Delaney, a spokesman for MNSure, the state’s marketplace for Obamacare plans. About 250,000 people, or 5 percent of the state’s population, were covered under plans bought on the individual market, including plans bought on the Affordable Care Act markets as well as outside it.

Many people in the exchanges are eligible for tax credits to help reduce the cost of the premiums, Rothman’s office said, though those subsidies cut off once a family of four has an income of $97,200 or more. The law requires all Americans to buy insurance or pay a penalty. In Minnesota, a low-cost plan for a single person last year had annual premiums of about $2,800, before any tax credits, according to the Kaiser Family Foundation.