The top-selling insurer on the state’s MNsure exchange has pulled out of the online marketplace just two months before this year’s open enrollment period begins.Not sustainable? Fancy that. Why would that be? One guess, from the Star Tribune article, make sense to me:
Golden Valley-based PreferredOne had set the lowest premium prices in the nation last year and signed up nearly 6 in 10 consumers who shopped on the MNsure exchange.
But the insurer’s CEO, Marcus Merz, said this week in a letter to the exchange’s leaders that “continuing to provide this coverage through MNsure is not sustainable.”
But Caroline Pearson of health consulting firm Avalere Health, who has followed exchanges and the health reform rollout, said it was surprising to see an insurer drop out.The point of being in the insurance business is to avoid paying out premiums wherever possible. The goal of the customer is to maximize the premiums they receive while minimizing the costs involved. It would hardly be surprising that the pool of enrollees that MNsure attracts would include a lot of people who haven't been receiving medical care in the past and would have underlying health issues. It's always been a dubious model.
“Everyone was heading into 2014 with limited data about the true health demands,” she said. “My guess is they may be seeing premium prices that can’t sustain the medical costs they experienced with their enrollees.”
The timing of this announcement doesn't work so well for Mark Dayton, which explains why he was more interested in talking about Adrian Peterson than about this issue. Jeff Johnson was less reticent:
“This is yet another example of everyday, middle-class Minnesotans paying the price for Mark Dayton’s incompetence,” said Hennepin County Commissioner Jeff Johnson, who is challenging Dayton for the governor’s seat. “Six out of 10 people who’ve purchased insurance through MNsure will now have to go through the nightmare process of purchasing another plan all over again — thanks to Mark Dayton.”Stay tuned, folks. This story isn't going away.