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Outlook for Minnesota’s health exchange: It will come down to negotiations later

The state House passed a health exchange bill Monday night, but it differs with the Senate legislation.

DFL Rep. Joe Atkins: "There will be a health insurance exchange in Minnesota sometime in the foreseeable future."
MinnPost photo by James Nord

The stage is set for lawmakers’ final negotiations to shape Minnesota’s landmark health insurance exchange.

The state House passed the exchange legislation Monday night along roughly party lines, teeing up the measure for a Thursday vote in the Senate.

The procedural votes — it’s been clear from the beginning that DFLers would eventually pass the bill – set up conference committee negotiations where one body will likely give significant concessions to the other. That’s where Capitol watchers expect the bill to finally take shape.

Some of the key differences between the House and Senate bills include:

  • The House funds the exchange operation through withholding up to 3.5 percent of a premium, while the Senate would use state tobacco revenues.
  • The Senate has kept a straightforward “active purchaser” structure, while the House gave concessions to business groups and went with a hybrid model that leans slightly toward a “clearinghouse” exchange.
  • The House version bans insurance plans on the exchange from covering abortions, though that could change when lawmakers amend the Senate bill.

The exchange is expected to serve 1.3 million Minnesotans — and save individuals and small businesses roughly $1 billion — while providing coverage to hundreds of thousands of uninsured people across the state.

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Advocates liken it to an online portal where consumers can easily compare and shop for coverage, while opponents say it’s little more than an expensive website that won’t help drive down insurance costs.

Tight deadline

A key provision of the federal health reform law, Minnesota Democrats have been pushing forward with the exchange since the beginning of this session to meet tight deadlines or risk having a federally imposed model.

“There will be a health insurance exchange in Minnesota sometime in the foreseeable future,” DFL Rep. Joe Atkins of Inver Grove Heights, who carried the bill in the House, told his colleagues on Monday night.

If the state doesn’t move forward on its own, he added, the federal government “will impose a health insurance exchange up on us. That to me is untenable.”

Lawmakers have until the end of March to finalize an exchange, although the process will likely go quicker than that.

Atkins noted the marathon pace his bill took — it went through roughly nine committees and in the end was the focus of more than 50 hours of debate.

Republicans authored roughly 100 amendments on the House floor Monday night, a few of which were adopted. Perhaps the most controversial new provision was a measure from DFL Rep. Patti Fritz that would ban plans on the exchange from covering abortion.

That could become a sticking point with Senate lawmakers, though a similar provision could be added on the House floor.

GOP opposition

Republicans criticized the exchange for potentially not addressing rising health insurance costs and compromising Minnesotans’ data privacy. That was the refrain during roughly five hours of floor debate on Monday night.

“This does nothing but stick hundreds of millions of billions of dollars into government bureaucracy,” said Republican Rep. Glenn Gruenhagen, who predicted a “mass exodus” of doctors and other health care professionals if the exchange is implemented.

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“This is not good for Minnesotans. It’s not good for their health care,” GOP Rep. Kelby Woodard said. “It is less choice, it is higher cost and it is no privacy.”

Despite strenuous GOP opposition, the measure passed roughly along party lines, with one Democrat voting against the exchange and one Republican voting for it.

There was even some partisan wrangling around being on the conference committee. GOP Rep. Jim Abeler voted for the measure, which he didn’t support, to have an opportunity to provide input during the bill’s final negotiations.

What remains unclear is how lawmakers plan to negotiate the bill’s final version. Several key pieces of legislation, including the 2011 budget deal that ended the historic government shutdown and last session’s Vikings stadium bill, were negotiated in secret.

Rep. Tina Liebling, DFL-Rochester, had those concerns. The “conference committee should be public, unlike 2011 budget negotiations in ‘cone of silence,’ locked [in the] Capitol,” Liebling tweeted on Monday night.

Sen. Tony Lourey, who is carrying the Senate bill, has given the “hybrid” model in Atkins’ bill a cooler reception. It’s unclear how the other provisions will be ironed out, in private or in public.

Abeler, urged lawmakers to consider an exchange that works. “I hope as this process goes on, the conference committee will listen,” he said.