Dear Neighbor,
Hello from the Capitol, where MNsure’s faltering enrollment and Gov. Mark Dayton’s updated budget proposal made headlines this week.
The governor issued a supplemental budget to update his recommendations in light of new information learned in our state’s latest economic forecast. It projected a $1.23 billion surplus for the current biennium.
His updated plan includes $616 million in tax adjustments. This includes eliminating some controversial tax increases he signed into law in 2013 which lead to increased state spending of $1,500 for every man, woman and child in Minnesota. Let that sink in a minute.
The governor also proposes placing $455 more in reserves and an additional $162 million in state spending. I agree with adding to our reserves, but we can do without increasing spending, which already rose by double digits this biennium.
After all, we just received a report indicating February revenue in Minnesota was $17 million short of previous projections. This is even more proof that we need to take a responsible approach to appropriating the surplus funds the state anticipates.
Let’s be smart about this. We still do not know what lingering impacts taxes passed in 2013 will bring. Businesses plan for the long haul, so even repealing taxes now could leave our economy suffering damage to an unknown degree.
Minnesota’s Obamacare program – MNsure – also has been a topic of discussion this week as we approach the deadline for enrollment. Minnesotans must select a plan and pay the premium in full by March 31 to avoid penalties for not having health insurance.
It will be interesting to see how the enrollment numbers look after that deadline passes. MNsure enrollment has fallen short of even worst-case projections since the program started back in October.
We recently received updated data which says 33,680 enrollments are “in process” for commercial plans (individual and small business) as of March 8. This is just 19 percent – 19 percent! – of MNsure’s lowest original estimate of 177,125 commercial plan enrollments by the end of March.
For now, low enrollment figures mean Minnesota families of four will have to pay $285 penalty for being unable to purchase insurance by the deadline; the penalty for not having insurance will increase to $695 per person starting in 2016. Minnesotans will be subject to these penalties even if they spent hours on hold with MNsure’s call center, had their application disappear in MNsure’s system or discovered MNsure premiums were simply unaffordable for their family budget.
Over the long haul, faltering enrollment would leave Minnesotans paying even higher premiums and higher taxes to make up for a revenue shortage. We learned just this week that MNsure is projected to suffer a $5 million shortfall, but starter funding from the federal government will cover it.
Officials said they will not be coming to the Legislature for more money to support MNsure now, but the writing already may be on the wall for a program that has failed to live up to promises made by the governor and fellow Democrats. This could be ugly.
Sincerely,
Mark