Policy
Policy changes must be made to reduce the impact of health care mandates, taxes and regulations on the cost of health care. Lawmakers continue to propose legislation that places upward pressure on health insurance premiums at a time when employers and individuals are struggling to maintain current health care coverage. Health care mandates fall disproportionately on the fully insured market, increasing costs for mainly small and medium businesses. Legislators should focus on reforms that will help make health care more affordable, and not increase mandates and regulations that will drive costs up.
The objective for the 2012 Session will be to pass legislation that was introduced during the 2011 Session that addresses:
- Review process: Minnesota imposes more mandates and regulation on health care coverage, care delivery and services than almost any other state. Every benefit mandate proposed should be evaluated under statute 62J.26 to ensure all mandates considered by the Legislature receive a balanced review of the cost, benefits and medical evidence prior to their enactment. Insurance and care delivery mandates that do not provide measurable quality improvement and where benefits do not outweigh costs should be opposed and/or repealed.
The federal health care reform law enacted in 2010 requires the federal government to define the “essential benefit set” before 2014. Every health insurance product sold through the Exchange will have to include this benefit set. Any state mandate law would also apply to the health insurance policies sold through the Exchange. To the extent that the state mandates coverage beyond the benefits contained in the essential benefit set, the state will be responsible for the extra costs affiliated with the state mandates for subsidized products sold in the Exchange.
Other considerations for future legislation that are important to Chamber members include:
- Price control mandate: The Chamber encourages value-based pharmaceutical care and medication therapy management that provides the best care at the lowest overall health care cost. In addition, it opposes government-mandated price control proposals.
- State required participation: The state should abide by Minnesota Statutes 43A.23, which requires the state to follow all mandates passed by the Legislature. In addition, the state should fully fund any mandates it imposes on the health care system.
- Cost shifting: Minimize/eliminate government cost-shifting to the private market. The Chamber opposes state policies and proposals that reimburse health care providers below the cost of providing services to public program enrollees. This underpayment results in a direct cost-shift onto the private health care market, increasing the cost of health insurance for businesses and individuals. The Chamber will oppose the reduction of state public program reimbursement that results in increased cost shifting.
- Health care tax: Minnesota imposes several health care taxes that add up to more than 6 percent of the cost of premiums for some employers and individuals. The taxes fall disproportionately on the fully insured market causing increased cost for mainly small and medium-size employers and individuals. During the 2011 Special Session there was a provision passed that sunsets the provider tax in 2019. The state should look at ways to further reduce the additional costs it puts on the system in an effort to make health care more affordable for Minnesotans.
- Legal: The Chamber supports efforts to reduce the cost of medical liability on the health care system. Furthermore, it opposes efforts to extend current medical liability to employers or further expand medical liability on health plans.
- Employer privacy: The names of employers with employees on public health care programs should remain private information.
- Innovation: Support federal efforts to balance the relationship among incentives that bring new prescription drugs to market and promote competition and affordable drug coverage. Oppose efforts by the state to facilitate the illegal importation and purchase of prescription drugs from foreign countries.
Business Impact
State-imposed costs add to the already high cost of health care and make it more difficult for employers to provide affordable coverage for their employees. State-imposed costs and regulations also fall unevenly on the fully insured market, usually affecting small- and medium-sized businesses and individuals disproportionately. At present, less than one-third of Minnesota’s population is in a private insurance product regulated by the state. Employers that purchase in the state-regulated market often pay more for these benefits than self-insured employers. This puts these employers at a considerable disadvantage with their competitors that do not purchase state-regulated health insurance. Mandated benefits also limit innovation in plan design and health care service delivery by prescribing what is included in certain plans rather than allowing market forces to determine design and delivery.
