Two weeks ago, another high-profile Democrat seemed to be criticizing the Affordable Care Act. This week, Donald Trump seized on that criticism.
“The Democratic governor of Minnesota said the … Affordable Care Act is no longer affordable,” Trump said Tuesday at a rally in Sanford, Florida.
Trump is indeed correct. Minnesota Gov. Mark Dayton’s exact quote was “the reality is the Affordable Care Act is no longer affordable to increasing numbers of people.”
He thus joined Bill Clinton as a prominent Democrat casting aspersions toward Obamacare and causing agita among Democrats and Hillary Clinton’s campaign. Dayton later said he regretted how his statement was being used by Republicans to denigrate the whole law. But he stood by his criticism.
But what, precisely, is going on in Minnesota to cause Dayton to be so critical?
Like several other states, Minnesota is being buffeted by sharp increases in premiums, ranging from 50% to 67% for health insurance bought on the private, individual market. And, starting next year, there will only be seven insurance carriers operating in the individual market in the state. That’s down from eight because Blue Cross/Blue Shield announced in June that it was pulling out its PPO plan.
But while the premium hikes are dramatic and are having political ramifications, as seen by Trump’s remarks, what is the actual impact on people living in Minnesota? The answer is pretty big on a really small group of people.
Minnesota has a tradition of its companies providing health insurance for its employees. As a result, only about 250,000 people — about 5% of the state population — get their health insurance through the individual market, according to officials with the state’s Department of Commerce which regulates the insurance industry.
Of that number, about 80,000 buy their insurance through the state-run exchanges that were established under Obamacare, which is known in the state as MNsure. Now, all people in the individual market are subject to the huge increases in premiums. But about 50,000 of those purchasing on the exchanges receive federal tax credits and are, therefore, shielded from the big premium hikes.
In addition, a survey conducted by the state health department determined that an additional 100,000 who bought their insurance on the individual market would qualify for these subsidies but choose not to apply for them.
So, if everyone who qualifies for subsidies under Obamacare applied for them, about 100,000 people, or about 2% of Minnesota’s population, would have to pay for the huge premium increases without any help from the government.
“It’s working for the 3% who qualify for the federal tax credits through MNsure,” Dayton said in a statement Friday. “But the law isn’t working well for the 2% of Minnesotans in the individual market who don’t receive any financial assistance to pay for their coverage.”
Just like in several other states, the number of insurance carriers in the state is, no doubt, impacted by issues related to Obamacare. But it is also due to a Minnesota law that says only nonprofit insurance companies can sell policies in the individual market in the state. As a result, even giants like UnitedHealthcare, which is headquartered in Minnesota, do not participate in the individual market.
So Trump is correct. The Democratic governor of Minnesota does feel that the Affordable Care Act is no longer “Affordable” for some people in his state. Dayton, himself acknowledges that that is true, but only for a small segment of the state’s population.