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Do Nienow’s MNSure rate claims hold up?

by seano on September 26, 2013 · 12 comments

Republican State Senator Sean Nienow has long been an outspoken opponent of the Affordable Care Act and its Minnesota health insurance exchange incarnation, MNSure.  Nienow sits on MNSure’s Legislative Oversight Committee, and has been talking loudly about all the problems he finds with MNSure’s pending start-up next month.
Yesterday, Nienow popped off in response to a press release from Democratic State Representative Joe Atkins in which Atkins touted MNSure’s lowest in the nation rates:

This prompted an interesting exchange between Nienow and StarTribune editorial writer Jill Burcum:

That, of course, was the “money tweet”.  Nienow, one of the GOP’s point people on MNSure, didn’t know that the “real rates” had been released nearly three weeks ago.  Way to be up to speed, Senator.  The helpful folks over at MNSure helped him out, though.

Prompting Nienow to issue the “let me slink out of here while I still can” response:

Nienow’s process ignorance aside, what about his fundamental underlying point, though?  Is insurance under MNSure way more expensive than what is available on the private market today?  Well, let’s take one frequently cited data point and examine it a little more closely.  (Let’s start off by acknowledging the caveats here — this is one example only that may or may not be representative of what others may experience.)
One of the rates that got everyone’s attention when the rates were released was the $90.59 lowest monthly premium for a 25-year-old Metro area non-smoker.  This rate, and most of the other MNSure rates came in at least 20% below Congressional Budget Office estimates.  The plan that produces that rate is the Preferred One Afford Select+ D (plan detailed starting on page 143 of this PDF file).  Let’s compare this plan to an equivalent plan on the private market.  To do so, I went to (an online marketplace that handles the same insurance companies that will be participating in MNSure) and found the closest comparable plan from Preferred One for a 25-year-old Metro area non-smoker.
Here’s the tale of the tape for the two policies:

Market Plan

Preferred One for One

MNSure Plan

Preferred One Afford Select+ D

Monthly Premium  $86.30  $90.59
In-Network Deductible  $5,500  $6,350
In-Network Out of Pocket Maximum  $6,500  $6,350

In-Network Charges Per Service After Deductible Has Been Met

Office Visit $35 copay for first three visits; then patient pays 20%  $50 copay for first two visits
Generic Prescription (Retail) $10 copay $10 copay
Brand-Name Prescription (Retail) Provider negotiated discount $75 copay
Non-formulary Prescription Not covered Not covered
Emergency Room Visit $300 copay first visit; then patient pays 20% Fully covered
X-Ray 20% Fully covered
Surgery 20% Fully covered
Hospitalization 20% Fully covered
Labor and delivery hospitalization Not covered Fully covered
Mental health – outpatient Not covered $50 copay for first two visits
Mental health – inpatient Not covered Fully covered
Substance abuse – outpatient

Not covered; additional rider at $2.59 per month available

$50 copay for first two visits
Substance abuse – inpatient Fully covered

Not much difference here.  If we look at a “worst case scenario”, where one maxes out their in-network out-of-pocket maximum in addition to paying 12 months of premiums, one pays about $100 less under the MNSure plan ($7,437) than they do under the current market plan ($7,536).  Before that $6,350 deductible point on the MNSure plan, the current market plan comes out slightly ahead, but by no more than $53 on an annual basis at any point between $0 and $6,350.
In this case, Nienow’s doom and gloom seems sorely misplaced.  Especially given that young adults were supposed to be the ones “losing” from the implementation of the Affordable Care Act.   If MNSure is producing comparable rates to the current market for young adults, then older and sicker Minnesotans are likely – on average — to do be doing much better.  That’s an outcome to be lauded, not buried by self-serving and fact-free political rhetoric like Nienow’s.
If Republicans have actual evidence that MNSure rates are higher, then they should produce realistic side-by-side comparisons like the above to prove their point.  Merely asserting it to be true ain’t good enough.

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