FAQs about the Minnesota Health Plan
Click on a question below to view the answer.
- What is the Minnesota Health Plan?
- Why do we need the Minnesota Health Plan?
- Is there a model in the world that works like this?
- Who would be covered under the Minnesota Health Plan?
- What services are covered under the Minnesota Health Plan?
- How does the Minnesota Health Plan control costs?
- Who will run the health care system under the Minnesota Health Plan?
- How is the MHP paid for?
- Why are they called premiums instead of taxes?
- Is the Minnesota Health Plan socialized medicine?
- How do we get beyond the prejudice of Americans against government, communal solutions to human problems?
- Won't there be "waiting lines" for health care services?
- Why should my hard-earned money go to pay for "free" health care for people who don't want to work and don't take care of their health?
- Won't people from out of state move here just to get health care?
- What about consumer choice under the Minnesota Health Plan?
- Won't health care be "rationed"?
- The MHP does not define who is a "resident." What are the criteria that must be met?
- How does the plan differentiate between covering undocumented workers and charging people from other states? Why should we cover people here illegally?
- Once the Minnesota Health Plan goes into effect, will private insurance still be available in MN? How? What for?
- Will the people working for insurance companies lose their jobs?
- Don't people need "skin in the game" If there is no cost-sharing, won't people overuse health care?
What is the Minnesota Health Plan?
The Minnesota Health Plan (MHP) would be created by legislation (the Minnesota Health Act SF118/HF135) now under consideration by the Minnesota Senate and House. The MHP would provide comprehensive health care for all residents of Minnesota in the most economically efficient manner possible. It ensures that health care dollars are spent on health care, not on unnecessary administrative costs.
The Minnesota Health Plan can be thought of as a single health care plan that covers everyone, from the Governor and CEOs to average wage earners. The financing of the Plan is based on what some people have described as a "single-payer" system, enabling us to control our run-away health care costs, while providing access to all needed medical care, including many types of care that are frequently not covered now, such as dental care and nursing home care.
Why do we need the Minnesota Health Plan?
- Healthcare expenses are the cause of more bankruptcies than all other causes combined.
- Everybody needs healthcare, yet many cannot afford it - 45,000 Americans die each year because of the lack of access to affordable healthcare.
- About 9% of Minnesotans have no health coverage at all.
- Perhaps 30% more have health insurance, but still cannot get the care they need, due to exclusions in their coverage (optical care, dental care, etc.) or co-payments and deductibles that they cannot afford.
- Many people cannot work because of untreated mental or physical health problems and many businesses cannot expand and grow because they cannot afford health care for more employees, creating a drag on our economy and productivity.
The health of our economy is dependent upon the health of our residents. We need to ensure that all residents have access to health care and that the financial costs of this care do not lead to bankruptcy.
We need to fix the health care mess by providing comprehensive health care to everyone while controlling costs. This can only be accomplished by a single plan that eliminates the insurance company administrative costs and includes price negotiation; a plan that ensures sufficient medical providers in every community; a plan that focuses on community and public health and wellness; a plan that covers everyone regardless of health condition or income; a plan that includes all needed medical care including prescriptions, nursing home care, etc.; a plan that allows people to focus their attention on their health and healing rather than worries about what is covered and whether they can afford or get care; a plan like the Minnesota Health Plan.
BYLAWS
Is there a model in the world that works like this?
YES! In every other industrialized country (and others that we consider "developing") the government has made the moral decision to guarantee universal coverage - everyone in and no one out. None of those countries leave sick people in the position of needing to prove that they are qualified to get care, and none of them add stress to vulnerable people by making them worry about how they are going to pay their medical bills.
Every other industrialized country has settled on a model of coverage instead of relying on a patchwork of systems like we do here. Every other country has prohibited for-profit coverage for basic health needs. Every other industrialized country sets a benefit package and guarantees continuous coverage regardless of income, employment and health status. Every industrialized country requires timely payment of all claims. (This is why every other industrialized country spends significantly less per capita and less as a percentage of GNP than we do and manages to cover everyone and report better outcomes.)
All of these features are part of the MN Health Plan, yet the Minnesota Health Plan is not simply a copy of any other country's health care system. Instead, it was based on a series of principles that define what the health care system must do. It then builds a health care system around those principles, using what we learn from other models, and making changes to avoid making the mistakes that other systems make.
One of the biggest problems with some of those other countries' health care systems is that they are under-funded by public officials when budget times are tight. As a result, the Minnesota Health Plan has the premiums established by the health plan's board based on the needs of the plan, not set by the Governor and Legislature based on the state budget needs of the year.
Since the MN Health Plan was written with the benefit of being able to examine other working models, it is able to offer some improvements or highlight reforms present in some but not all models of universal coverage:
- Designation of a care coordinator for patients
- Ability to set reimbursement rates to assure adequate number of providers in underserved areas
- Global budgeting for institutional care (hospitals, long term care facilities) rather than require the facilities to track every expenditure then bill each patient and their insurance plans for those expenses
- Funding for public health and community prevention programs
Who would be covered under the Minnesota Health Plan?
All Minnesotans are covered.
Under the MHP, there is no denial of care because of pre-existing conditions. There are no insurance company clerks telling your doctor how to practice medicine. The MHP provides coverage from birth until death, regardless of health, financial or employment status. Coverage follows you if you travel, retire or lose your job.
What services are covered under the Minnesota Health Plan?
All necessary medical care is covered under the MHP.
Under the Minnesota Health Plan, medically appropriate care is completely covered, including primary care, dental, mental health care, hospitalization and prescription medication. Medical equipment, skilled nursing home care, home health care, substance abuse care, prescription glasses and hearing aids are also covered.
Elective cosmetic procedures are not covered.
How does the Minnesota Health Plan control costs?
The MHP controls costs by cutting waste, not by denying care to patients.
The MHP controls costs through:
- Administrative efficiency and elimination of the vast bureaucracy devoted to denying care, billing and paying out claims for care at different rates and with different coverage for the same procedure, elimination of insurance marketing and administration.
- Increasing access to preventive services and early intervention for everyone, preventing costly emergency room and hospitalization expenses.
- Bulk purchasing of drugs and medical supplies at lower, negotiated prices
- Allocation of medical infrastructure and resources (like hospitals and surgical centers) based on a region's needs
- Annual budgets for health care facilities, rather than the current method of itemizing each pill dispensed, and each individual expense, and then billing them at different rates to different insurance companies for each patient treated.
- Negotiation of provider fees
- More efficient delivery of care (use of school nurses to administer flu shots instead of sending each student individually to an outside clinic, not sending patients by ambulances to more distant hospitals because closer hospitals are not in "network")
Who will run the health care system under the Minnesota Health Plan?
The MHP is governed by a public board appointed by locally elected county commissioners from every region of the state. The board will include health care providers and consumers.
The MHP Board runs the MHP and negotiates doctor fees and hospital budgets. It is responsible for health planning and the distribution of expensive technology, as well as working with the University, other higher education institutions, and local communities to ensure sufficient providers in every community. The budget for health care is set through a democratic and transparent process.
How is the MHP paid for?
Revenues for the MN Health Plan would come from the same sources they do now - government, businesses and individuals. Individual and business contributions to the fund (premiums) are based on ability to pay. There are no co-pays or deductibles.
Currently, government is the largest payer of health care services. Individuals are asked to pay an ever-increasing amount in the form of premiums, co-pays, and deductibles - if they have insurance. Those without insurance and those who are underinsured face devastating medical bills. For most individuals the premium payment for the MN Health Plan would be less than they are paying in premiums to insurance companies, co-pays at the clinic, and deductibles of the insurance company.
Why are they called premiums instead of taxes?
Opponents will say that the MN Health Plan will drive up taxes. Aren't these taxes? Keep in mind that health care is now one-sixth of the entire economy. Funding the MHP isn't like adding some additional taxes to pay for a new government program or service. We are talking about restructuring how we finance one-sixth of our economy, most of which is and would remain in the private sector. We are simply shifting the premiums that people pay to their current health plan to the MN Health Plan. Likewise, employers would now be paying their share to the MN Health Plan. These premiums would replace all current premiums and out of pocket expenses for health care.
Unlike taxes, these premiums do not go to the state treasury; they go directly to the MN Health Plan. They cannot be taken by the governor or legislature and cannot be used to balance the state budget or pay for anything else.
Is the Minnesota Health Plan socialized medicine?
No. Socialized medicine is a system where the government employs all healthcare providers. In the MHP, like in Medicare, health care is publicly financed but delivered through existing doctors, clinics and hospitals.
Some opponents claim that under a single plan, the government will make the medical decisions. But in the MHP, medical decisions are left to the patient and doctor. Under the Minnesota Health Plan, doctors and hospitals that are in the private sector remain in the private sector.
How do we get beyond the prejudice of Americans against government, communal solutions to human problems?
Actually, Americans overwhelmingly favor a government solution to our health care crisis. A January, 2008 AP-Yahoo poll revealed that 65% of Americans said yes to the statement: "The United States should adopt a universal health insurance program in which everyone is covered under a program like Medicare that is run by the government and financed by taxpayers.
That being said, the issue of distrust of government is played up by the opposition. People worry that government intervention will worsen quality of care. However, the Veteran's Administration is considered to provide the highest quality and most cost effective care in the country. No one criticizing "government run" health care ever suggests privatizing the Veteran's Administration. Medicare, a single-payer system is rated very favorably by enrollees and suggestions about changing Medicare are met with vigorous opposition.
It is also helpful to understand that the governance structure of the MHP begins at the regional level. An elected regional board identifies the regional health care needs and presents them to the state board. Each region has a representative on the state board. This is a "bottom up", open and public style of creating a health care system, not a "top down", closed or private system.
Won't there be "waiting lines" for health care services?
Waiting lines are an indication of inadequate capacity in the health care system. The MN Health Plan would increase the capacity of Minnesota's health care system, while still lowering costs through administrative savings. In fact, one of the founding principles of the MHP is a requirement that the plan ensure that there are an adequate number of health care professionals to guarantee timely access to care.
We currently have "waiting lines" for those seeking certain non-emergency specialized care. For example, anyone who has tried to see a dermatologist, a psychiatrist or certain other specialists, it can easily take 3 months to get an appointment. Remember that many middle and moderate income Minnesotans have no line to wait in because they cannot afford the care at all.
The "wait list" issue often is brought up in reference to Canada, which has a very popular single health plan that covers everyone, despite spending about half as much as the U.S. Although there have been problems with waiting times for some non-emergency procedures in Canada, the problem is smaller than portrayed by American health insurance companies, and the Canadian provinces are addressing the problem.
Why should my hard-earned money go to pay for "free" health care for people who don't want to work and don't take care of their health?
It is not true that the uninsured don't work. 71% of uninsured Minnesotans have jobs, and 80% of these are working 31 hours/week or more. Our taxes and our health insurance premiums are already going to pay for health care for the uninsured. When those without coverage use expensive sources of care, such as emergency rooms, and can't pay their bills, those costs get absorbed by government and the insured by way of higher premiums. All of these costs are higher in our fragmented multi-payer system. Single-payer financing is a fairer and more efficient way for us all to contribute.
Note too that the government already pays for over half of healthcare. This includes federal employees, the elderly and disabled, not just the poor. Government funds help support public universities, including medicals schools and they fund a significant amount of medical research.
The best way to get people to take care of their own health is to get them in the health care system and then give them the knowledge and tools to take care of themselves. If we shut them out of the system they will not be able to make those changes. Poor health habits are just as much a problem among those who work and those who have insurance as they are among those who don't.
Won't people from out of state move here just to get health care?
The Minnesota Health Plan, with its lower costs and comprehensive coverage will attract businesses and individuals from other states.
The MHP Board is required to work with the federal government to create standards to prevent an influx of people from other states and to get reimbursement from the other states or the federal government for people that do move here. Minnesota is responsible for the health care of its own residents, and other states should be responsible for their own. If people from other states move here to get health care, those states should be held responsible for reimbursing those costs.
Like every other major health reform proposal, the MHP would require waivers and authorization from the federal government to address this issue. (This issue is one of the reasons that national reform would be preferable to state-by-state reforms).
The MHP would attract businesses from other states because it is less expensive to expand and grow here without the worry of finding health care coverage for employees. But this is not a problem; it's an answer to a problem!
What about consumer choice under the Minnesota Health Plan?
You will have more choice of medical provider under the MHP than you do now.
Currently, many consumers may only choose providers within their health plan network. Under the MHP, you can choose any licensed provider - there are no "networks" to worry about.
Won't health care be "rationed"?
Health care should not be rationed by either government or insurance companies. Decisions about appropriate care should be made within the doctor/patient relationship.
In fact, people tend to be very good at "rationing" their own health care - when given an option, through a living will (advance directive), most people will choose not to be resuscitated when they are terminally ill and in pain. When spine doctors and their patients discuss options thoroughly, many choose not to have costly surgery, selecting alternative treatment instead.
Minnesotans' health care is currently rationed:
- by insurance plans excluding care because of pre-existing conditions, or even refusing to cover people with chronic health problems -- the sicker you are and the more you need care, the more likely they will deny you coverage and care
- by insurance plans overruling doctors' treatment plans
- by cost, when people cannot afford insurance or out of pocket expenses
- by lack of providers - there is a serious shortage of dental care providers, especially in many small rural communities
Under the MHP, care would not be rationed by government or insurance companies. It would not be rationed because you are sick or unable to pay. And, the MHP is required to work with higher education institutions and incentives to train and recruit enough medical professionals to meet the need, so it would not be rationed by a lack of providers.
If there comes a time when we cannot afford all medically necessary care for all individuals, the decision about which benefits to offer will be made by the Minnesota Health Board in a transparent manner open to public input.
The MHP does not define who is a "resident." What are the criteria that must be met?
The criteria for residency have not yet been determined. Under the bill, it is left to the Minnesota Health Board to determine the criteria for individual eligibility, hence the Board will define "resident" for the purposes of this bill.
How does the plan differentiate between covering undocumented workers and charging people from other states? Why should we cover people here illegally?
The MHP does not treat undocumented workers differently from anyone else. If the undocumented worker meets the eligibility requirements for residency, he or she will enroll in the MHP, pay the premiums, and receive care as needed. If the undocumented worker is not a resident, he or she will not be given a card and will be billed if he or she needs medical care, just as visitors from other states will be billed.
Neither the Health Board, nor any health care institution, nor any individual health care provider will be responsible for seeking identification beyond enrollment in the Minnesota Health Plan. The alternative is to require the Minnesota Health Board to become a law enforcement agency that enforces our immigration laws. That is not a good idea. Requiring the board to act like police will create high administrative costs, and it could threaten the health of bona fide residents.
Having all residents have coverage improves public health. We don't want the person at the check-out counter, in church or in the classroom to be spreading infections because they don't have access to health care. When everyone has access to preventive and acute health care the costs in terms of health and money are lower for all of us.
Once the Minnesota Health Plan goes into effect, will private insurance still be available in MN? How? What for?
On and after the day the MHP becomes operational, a health plan, as defined in Minnesota Statutes, section 62Q.01, subd. 3, may not be sold in Minnesota for services provided by the Minnesota Health Plan." Practically, this would mean that private insurance could only be sold for services excluded from the MHP - those of convenience, not of medical necessity (such as purely cosmetic surgery).
Will the people working for insurance companies lose their jobs?
Regrettably, as with any economic change there is some job displacement but the MHP has provisions to retrain and assist those displaced into other jobs.
Keep in mind however, that our current health care system's high costs and limited access inhibits economic growth. In contrast, enactment of the MHP would stimulate the economy and create new jobs. It would free businesses to expand without worrying about finding, negotiating, and paying for health care benefits for their employees. Entrepreneurs and self-employed individuals would be able to spend full-time on their business ventures rather than seeking another job which would provide benefits. The MHP would be a strong jobs magnet for businesses in other states looking to expand, and this would create new job opportunities for laid-off health workers.
Minnesota has a responsibility to assist those facing job transitions, and the MHP contains provisions to help retrain displaced workers as a result of the new plan. Because there is a shortage of many medical professionals such as medical technologists, RNs etc., it would be easy to help insurance workers transition to positions in the medical profession. In fact, many insurance company employees already have medical training and could quickly return to fill much-needed medical positions. The billing clerks in doctors' offices and hospitals could contribute to the capacity and quality of the health care system by being retrained and moved from bureaucratic positions to medical ones.
Finally, the MHP has the authority to contract out the processing of medical claims, and it would be logical for them to select one of the large health plans, keeping a portion of their administrative personnel in place.
Don't people need "skin in the game"? If there is no cost-sharing (co-pays and deductibles) won't people overuse health care?
When people pay first dollar, they delay or avoid getting care and this ultimately leads to increased overall costs and worse outcomes. A recent study demonstrated that even a modest increase in co-payments (average increase $7.00) among elderly Medicare recipients led to a decrease in out-patient clinic visits but an increase in number and length of hospitalizations with an overall increase in cost. The study also concluded that increasing copayments may have adverse health consequences. The results were more pronounced for people with chronic medical conditions where deferring effective outpatient care is likely to have both adverse health consequences and lead to increased costs.
Underuse is a bigger problem in this country- people self ration care because they can't afford it and health problems get worse. Primary care visits are not a significant cost driver.
Bear in mind a couple other points- primary care visits are not the cost driver in health care. Primary care actually offers a return on investment: care coordination, fewer hospitalizations and emergency room visits, better outcomes of chronic conditions, fewer malpractice claims and even lower rates of obesity.