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Frustration with Trump administration brings Dayton and state Republicans together

Both are frustrated with poor communication from the Trump administration over health care funding.

Gov. Mark Dayton at Minnesota's Republican state legislators have gone through a rocky few months, what with the very-public budget battle and lawsuit that's still getting sorted out.

But right now, both are in full agreement on something.

Lawmakers this spring approved a plan (referred to as reinsurance) that will help keep health insurance premiums lower for Minnesotans who buy who coverage on the open market. 

Dayton didn't love the plan but let it become law anyway, saying he knows it's important to lower premiums. 

So far, it appears to have worked. Local health insurers said the reinsurance would dramatically slow the rising cost of premiums people have to pay. And the New York Times even did an entire story about how it could be instructive for U.S. lawmakers looking to address health insurance costs. 

But there's a hang-up

To implement reinsurance without taking a financial hit, Minnesota needs what's called a 1332 State Innovation Waiver – it's a way for states to add health care features beyond what's laid out in the Affordable Care Act.

As Minnesota's Commerce Department explains, the waiver would secure some federal funding for this reinsurance plan, and also ensure federal funding for MinnesotaCare (an insurance program for low-income Minnesotans) doesn't get slashed.

According to Dayton's office, state officials have been in talks with federal officials about the reinsurance bill and the 1332 waiver for months. 

But despite being told repeatedly that Minnesota's application was good to go and should be approved before September, state officials still haven't gotten an official word that yes, it's been approved.

On top of that, the White House administration recently told the governor that landing the reinsurance waiver could mean Minnesota loses out on $369 million in federal funding for MinnesotaCare over the next couple years.

That's goes against "all direction and assurances" Minnesota officials were given while writing the reinsurance bill and applying for the 1332 waiver, Dayton wrote this week in a letter to HHS Secretary Tom Price.

And as The Associated Press recently reported, the state legally has to set insurance rates by Oct. 2 – so they need a clear answer soon

The governor's office provides a timeline of communications from February through August here.

The governor, state Republicans push together

Both Dayton and state Republicans from the House and Senate are urging U.S. officials to immediately approve the waiver, and expressing concern about that possible $369 million federal funding hit.

That new revelation "completely contradicts" what Dayton was told recently, Republicans leaders in the Minnesota House and Senate wrote in a letter to Price and Treasury Sercetary Steven Mnuchin

"That is, Minnesota was only now informed that other state-federal partnership healthcare programs would be adversely impacted by the institution of a state-based reinsurance program," the letter continues.

How big of an impact would it make?

The state could be in line to lose $369 million in federal Basic Health Plan funding for MinnesotaCare – but would gain $208 million in federal funds for reinsurance.

Overall, Minnesota would be $161 million in the hole according to the governor's office.

Dayton called it a "very damaging reversal of federal responsibility" if the cut does indeed go through, and excoriated the Donald Trump administration for what he called a "nightmarish" waiver process.

"Essentially, we are being penalized for doing exactly what the President and you have been encouraging us to do: take new reform initiatives," he wrote.

State Republicans had a slightly different take, saying they were just trying to cope with the "turbulence and expense of Obamacare" as best they could. But the request was the same – get the waiver officially approved.

"We are at the mercy of a Congress at impasse and the willingness of the Trump Administration to minimize the destruction caused to Minnesota families under the current law," they wrote. "People’s livelihoods – their families, small businesses, homes – are at stake."

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