FROM THE ARCHIVES: MNsure’s First Year in Review

Out of Touch: Mark Dayton Says Minnesota’s Obamacare Exchange Performed “Phenomenally Well.” “Minnesota Gov. Mark Dayton says he’s pleased with the progress of Minnesota’s health care exchange so far…’Given the complexity and the scope of the project, I think it has performed phenomenally well,’ the governor said Tuesday.” (Pat Kessler, “Minn. Politicians Clash On MNsure’s Performance So Far” WCCO-TV, Oct. 22, 2013)

Minnesota’s Health Exchange Website Is in Such Disarray That It Could Take 12 to 24 Months to Fix. “[A]ccording to a report by a consultant group hired by the state to assess technical problems. Citing poor project management and over 200 software defects, the group suggested rebuilding the website from scratch and overhauling its software architecture as one option.” (Clint Boulton “Minnesota Health Exchange Could Take Two Years to Fix, MNsure Consultant Says” Wall Street Journal, Jan. 23, 2014)

MNsure loses its biggest, lowest-cost insurer “The largest and lowest-cost provider of private health plans on the MNsure system is pulling out for next year, saying it’s “not sustainable” to continue. PreferredOne’s exit is disappointing and may require some scrambling for its current enrollees,” (Doug Belden and Tom Webb “MNsure loses its biggest, lowest-cost insurer” Pioneer Press” Sept. 17, 2014)

Enrollment of so-Called “Young Invincibles” Falls below Projections. “Young Invincibles” are one of the key groups needed to keep the insurance exchange functional. Failure to enroll young, healthy individuals to offset the costs of more illness-prone enrollees has been predicted to drive costs up to offset the increased costs associated with providing coverage. While projections called for 40% of enrollees to be “Young Invincibles,” in Minnesota roughly 25% of enrollees match this profile. (“MNsure Metrics Dashboard” MNsure, Sept. 17, 2014) (Levitt, Claxton, & Damico “The Numbers Behind “Young Invincibles” and the Affordable Care Act” Kaiser Family Foundation, Dec. 17, 2013)

Minnesotas Obamacare Exchange Increases Obamacare Tax 133%. “Minnesotans were told that the MNsure funding tax would stay around 1.5-2% of premiums charged and not jump to 3.5%, which is the rate for funding the federal exchanges…This week the MNsure board of directors voted to raise the gross premium tax in 2015 by 133%, from 1.5% to 3.5% This tax increase will result in higher [health care] insurance premiums for Minnesotans with either employer-based or individual coverage.” (Lee H. Beecher, MD, “A Cost Benefits Analysis for the MNsure Insurance Exchange?” Minnesota Physician-Patient Alliance, May 19, 2014)

Broken Promises as 140,000 Minnesotans Lose Existing Health Insurance Plans. “At least 140,000 Minnesotans who buy health insurance on their own are being notified that their plans will no longer be available under the new federal health care law, adding to the national furor over canceled policies that has overtaken the health care debate.” (Kevin Diaz “At least 140,000 Minnesotans will lose current health policies” Star Tribune, Oct. 30, 2013)

Surge in Publicly Funded Health Insurance Plans Could Lead to Financial Problems. “[M]illions of people who already were entitled to its safety-net coverage were not enrolled. Those same people are now signing up in unexpectedly high numbers, partly because of publicity about getting insured under the law…”Anyone who didn’t budget for this is going to be behind the eight ball,” Avalere CEO Dan Mendelson said. ‘It’s the kind of thing governors will want to discuss with the White House.’” (Ricardo Alonso-Zaldivar “States Face New Cost Concerns With Medicaid Surge” Real Clear Politics, May 27, 2014)

Bonuses for Bureaucrats Who Built Failed Obamacare Exchange in Minnesota. “Fourteen MNsure managers were paid bonuses totaling more than $26,000 in November as Minnesota launched its troubled online health insurance exchange, state officials said Wednesday. After MNsure went online Oct. 1, software problems bogged down website users and led to long delays for callers to its overwhelmed call center in St. Paul.” (Christopher Snowbeck “MNsure awarded $26,000 in manager bonuses before website launch” Pioneer Press, Jan. 29, 2014)

Glitches Made MNsure into a ‘Horror Story.’ “[W]ith Desirae’s medications running low, she discovered that Preferred One didn’t have any record of health insurance for the couple, and the money they had paid for the premium didn’t nearly cover the full amount.” (John Lundy “Family: Glitches made MNsure into a ‘horror story’” Duluth News Tribune, June 7, 2014)

Private Insurance Plan Enrollments and Funding Source for Minnesota Obamacare Exchange Lag Behind Projections. (“MNsure Enrollment Update” MNsure, Sept. 17, 2014)

Analysis Highlights Concerns over Low Numbers of People Buying Private Health Insurance in Exchanges. “[I]f that trend continues, there’s concern there won’t be enough healthy people buying health insurance for the system to work…Gail Wilensky, a former Medicaid director said ‘either the private insurance enrollments come up somewhere around the expected amount or there’s going to be a problem…You need a volume and you need a mix of people that are healthy as well as high users in private insurance, in order to have it be sustainable.’ Industry sources say if we do not see some real turnaround soon, there could be big problems for the entire system.” (Jan Crawford, “Medicaid enrollment spike a threat to Obamacare structure?” CBS News, Oct. 25, 2013)

MNsure Defects Were No Surprise. “Project leaders chose to launch Minnesota’s health insurance website knowing it was plagued by bugs.Managers and auditors said for months that the project was falling woefully behind and that critical system tests came too late or had to be curtailed.” (Jeffrey Meitrodt “MNsure defects were no surprise” Star Tribune, April 6, 2014)

Minnesota’s New Insurance Exchange Is Beset with Severe Problems That Include IT Systems in Disarray, a Woefully Understaffed Call Center and Management That Can’t Get out of “Crisis Mode.” “according to consultants hired to examine MNsure… ‘Current program management structure and process is nonexistent, and management/leadership/decision making is occurring via crisis mode,’” (Jackie Crosby “Optum: MNsure managed by ‘crisis mode,’ IT system in disarray” Star Tribune, Jan. 23, 2014)

Government Spent Millions on Advertising Obamacare Exchange That Didn’t Work. “The state run healthcare exchange spent $3.5 million in federal grant taxpayer money on advertising. However, these ads did not help MNsure’s image, according to results from a research company’s study. Persuadable Research Corporation found from August until February, negative impressions of MNsure shot up from 11 percent to 35 percent.” (Cassie Hart “Study Shows MNsure Ads Featuring Minn. Icons Didn’t Help Image” KSTP, June 4, 2014)

MNsure Rollout Creates Frustration. “At the conclusion of his [Tim Sachi’s] shopping experience Monday, Sachi learned that his application for a public health insurance program is now being processed, and he’s unclear about the next step. ‘I’m not sure if I should wait to find out what they will send me, or I should go to one of the health plans,’ the 56-year-old Woodbury resident said. The question is just the latest frustration, Sachi said, since it took him about 30 attempts over the past week to finally create an account on the MNsure website.” (Christopher Snowbeck, “Praise, confusion greet MNsure – Consumers have mixed responses to state’s new health exchange,” Pioneer Press, Oct. 8, 2013)

Small Businesses “Will Find More Options Outside” MNsure, Face Rate Increases. “…some insurance experts say that attracting small businesses could be challenging for MNsure…[s]even insurance companies are competing for small-business customers in the traditional health insurance market that continues to exist ‘outside’ of MNsure, according to data from the state Commerce Department. That compares with just three companies competing for small-business accounts on MNsure. So, small businesses will find more options outside the exchange.”(Christopher Snowbeck, “Some small businesses may forgo MNsure to delay rate hike – Exchange’s rules raise some 2014 premiums,” Pioneer Press, Oct. 12, 2013)

Legislative Auditor’s Report: “MNsure Officials Made Decisions That Contributed Directly to the Disclosure of Private Data.” “The report “said that MNsure made a series of critical decisions that made personal information connected to 1,500 Minnesota insurance brokers vulnerable to a breach. Fast-moving timelines, not enough workers and inadequate data security are all to blame…the Legislative Auditor also questioned why MNsure was collecting broker Social Security numbers in the first place – a piece of information that was not necessary to certify insurance agents…the Legislative Auditor also questioned why MNsure was using unsecured email to gather personal information from brokers.” (Catharine Richert, “Probe: MNsure date breach was unintentional,” Minnesota Public Radio, Nov. 7, 2013)

MNsure Accused of Placing People on Medicaid Who Don’t Qualify The Minnesota Legislative Auditor’s Office has confirmed it is investigating complaints that allege MNsure placed people on Medicaid, which provides medical assistance to low-income people, who don’t qualify. (Jay Kolls “MNsure Accused of Placing People on Medicaid Who Don’t Qualify” KSTP, Sept. 23, 2014)

Obamacare Increased 2014 Individual-Market Premiums By Average Of 49% Among men, the county with the greatest increase in insurance prices from 2013 to 2014 was Buchanan County, Missouri, about 45 miles north of Kansas City: 271 percent. Among women, the “winner” was Goodhue County, Minnesota, about an hour southwest of Minneapolis: 200 percent. (Avik Roy “3,137-County Analysis: Obamacare Increased 2014 Individual-Market Premiums By Average Of 49%” Forbes, June 18, 2014)