MNsure Reform

Minnesota’s already low rate of people without health insurance fell even more over the past year, a survey from Gallup finds. At the beginning of 2014, just 9.5 percent of Minnesotans lacked health insurance, the fourth-best rate in the country. As of the start of 2015, that uninsured rate is now 7.4 percent, 2.1 percentage points lower.

Senate HHS Budget Chair, Tony Lourey’s (D-Kerrick) bill, SF139, went through a second committee this week. The bill seeks to eliminate the Board of Directors, and designates MNsure as a separate state agency. It also provides parity for MNCare and Medicaid with respect to compensation paid by MNsure to navigators and brokers to align with private insurers. Addressing the technology concerns, it requires MNsure to establish and maintain an agreement with MN.IT for IT services.

Sen. Lourey noted that the bill encompasses the three key recommendations included in the Office of Legislative Auditor report: governance structure, bring IT under MN.IT, and parity of pay to brokers for public and Qualified Health Plan (QHP) programs.

This year’s MNsure enrollment period was a technological success, but MNsure’s software still has major problems. The software meant to handle low-income people who qualify for public health programs is missing key features, wreaking havoc for counties as they try to manage their public assistance caseloads.

However, Board member Tom Forsythe reacted negatively to the idea saying, making MNsure a state agency would make the exchange less accountable than a board that makes decisions in meetings open to the public. He thought MNsure could concentrate solely on helping Minnesotans easily shop for and enroll in private health insurance plans (QHPs). Forsythe went as far as to suggest separating MNsure and DHS, allowing MNsure to have a much narrower vision. Sen. Sen. Lourey responded that this would contradict the one-stop-shopping premise of the Affordable Care Act. DHS Commissioner Jesson agreed with Sen. Sen. Lourey, saying that more than 90 percent of the people going through MNsure enroll in public programs.

Next stop Senate Commerce Committee.

Ebola Deficiency Funding/Pay Raises
Deficiency funding, usually a non-controversial measure, was held hostage for several weeks by the debate over the Governor’s recent pay raises for his Commissioners. Gov. Dayton maintained that they were a long time coming and the Republicans pushed back saying they were too large of a jump and thought the Governor should have notified them.

The agreed language includes the following one time appropriation from the General Fund.

• $10.68 million to the Department of Human Services for the Minnesota Food Assistance Program ($246,000) and the Minnesota Security Hospital in St. Peter ($10.44 million);
• $2.89 million to the Department of Health for costs of statewide Ebola activities and for grants to certain hospitals for Ebola-related expenditures; (Unity $221,000; Children’s $710,000; Mayo $413,000; and UMN $508,000; and $148,000 to EMS Board);
• $1.35 million for Minnesota Zoo operations; and
• $568,000 to the Department of Natural Resources for enforcement.

With respect to the salary issue, the language reduces the budgets of DHS, MDH and DNR for FY 2015 by the following: $16,000 for MDH, $6,000 for DHS, and $18,000 for DNR. It freezes salaries at 2014 levels through June 30, 2015 and then allows the Governor to authorize an increase on July 1 before oversight by the Legislative Coordinating Committees kicks in on July 2. There was some question about whether the raises would be automatic or require action by the Governor, so MMB requested clarification that Dayton would have the authority on July 1 to reinstate the increases.

The House and Senate appointed conferees on Monday. The conference committee met on Wednesday and adopted mostly House language with respect to the salary controversy. Votes and final passage on the conference committee report came Thursday in both chambers. The Senate held a lengthier debate over the salary issue with a vote of 35-29 and the House was quick to dispense with the report by a vote of 108-20. Gov. Dayton is expected to sign the bill.

Lottery

Legislation placing new restrictions on the state lottery is heading for another vote in the Minnesota Senate. The Senate Tax Committee passed the bill Monday. It now heads to the Senate floor. The measure bans the lottery from selling games at gas pumps and ATMs, as well as the online sale of instant win tickets.

During the committee hearing, Sen. Julianne Ortman, R-Chanhassen, told Minnesota Lottery Director Ed Van Petten that she thought the ATM sales were particularly “outrageous.” “I definitely draw the distinction between offering lottery tickets for sale, versus shoving them in your face and targeting certain individuals to buy them,” Ortman said. “It’s a very clear distinction, and when you made that leap I think you absolutely needed to come back and ask for authority through the legislative process and through statute.” Van Petten warned that a ban would put the lottery in violation of its contracts with vendors.

The House is also poised to vote on the lottery ban legislation. Lawmakers overwhelmingly passed the same bill at the end of the 2014 session, but DFL Gov. Mark Dayton vetoed it. He said earlier this month that he would veto the measure again but there is some indication the issue may have come up in negotiations over the deficiency bill.

Transportation

In making his case for higher state transportation taxes, Gov. Dayton points to a slowing flow of money from Washington for highway construction as a reason that he needs to call on Minnesota taxpayers.

As costs increase for building and repairing roads, Minnesota officials and transportation planners face a choice: scale back their annual construction programs or turn inward for money to narrow the gap.
Dayton is pressing for a new 6.5 percent wholesale tax on gas, which would be on top of the current 28-cent-per-gallon charge. That, along with higher vehicle registration fees and the sale of more bonds, would generate about $6 billion in the next decade to repair or replace 2,200 miles of roadway and 330 bridges.

Rep. Tim Kelly (R-Red Wing), House Transportation Chair, is not convinced raising taxes is the right course. House Republicans plan to seek a quick shot of new transportation funding this session, with a sizable amount drawn from a projected state budget surplus. Rep. Kelly has inferred that GOP members will wait until the 2016 session to figure out a long-term finance plan.

Minnesota’s transportation system is the fifth largest in the nation, the network of entities that care for the system is complex, and the funding streams are unpredictable.

SurveyUSA interviewed 600 Minnesota adults between Feb. 20 through Feb. 24. They answered questions about Gov. Dayton’s performance, transportation, commissioner pay raises and sports.  On the transportation question:

Governor Dayton proposes a sales tax on gasoline, higher driver’s license registration fees. and a higher general sales tax in the 7-county Minneapolis metro area to raise $6 billion over 10 years for new highways, bridges and mass transit. Do you approve or disapprove?

43% Approve
51% Disapprove
6% Not Sure

House Republicans propose spending $750-million on highways and bridges over four years by using some of the state’s budget surplus and other existing funds without raising taxes. Do you approve or disapprove?

75% Approve
17% Disapprove
8% Not Sure