Government-Run Health Insurance is False Hope

April 20, 2023

Government-Run Health Insurance is False Hope

Another year, another push for government-controlled healthcare at the Minnesota Legislature. Unfortunately, with progressive politicians in control of state government, Minnesotans are at risk of having their healthcare get even more expensive and complicated. There are serious problems with health care in our state. We see this in the decade-long rise in insurance premiums, the ever-increasing cost of medicines and care, and the declining share of Minnesotans obtaining health insurance through small employers or on their own. Health coverage is simply an unaffordable proposition for many families and small businesses. However, the last time politicians promised that a massive overhaul of our healthcare system would make coverage more affordable, Minnesotans got triple digit premium increases, skyrocketing deductibles, and narrow network insurance plans. That was ten years ago, also the last time we had single party control at the Minnesota Capitol. Back then, it was the Affordable Care Act and MNsure. The average family was supposed to save $500 per year on health insurance. Nobody was going to lose their plans. MNsure was going to be the Travelocity of health insurance. Within a few short years, that vision was in tatters. Health insurance premiums doubled or tripled for most of Greater Minnesota within a few short years. Hundreds of thousands of Minnesotans lost their plans. MNsure became the largest IT failure in state history. Fast forward and here we are again with single party control in 2023. Now, the promise is that a government-controlled public option will cure what ails us. All it’ll take to work, they say, is to give the government more control over your health coverage and millions in taxpayer-funded subsidies. There are just a few problems with their vision. First and foremost, it gives politicians and bureaucrats more control over your healthcare. Their track record has not been great. Second, in order to price the coverage competitively with private insurance plans, a government-controlled public option pays hospitals and doctors less than private insurance. For people who get their health insurance through work or buy private coverage on their own, this will make health insurance more expensive because hospitals and clinics will charge you more to make up their loss. Third, lower reimbursement rates may make it even harder to sustain healthcare centers and access to care in rural areas, where there is already a “severe shortage of all provider types,” according to the Minnesota Department of Health. We know from other states that a government-controlled public option is not a cure for what ails the healthcare market. Take Washington, where a government-dictated public option has struggled to attract enrollees since its inception in 2021. Only after $50 million in subsidies did Washington’s public option attract enrollees – and it was still just 11% of the market in 2023. Ultimately, a government-controlled public option is a lose-lose. Either enrollment is paltry despite heavy state investment or, buoyed by taxpayer-funded subsidies, the public option captures the market and gradually eliminates market-driven health coverage. Then, we get to their real goal of a single payer system. Offering health coverage is a critical tool for attracting and retaining employees, but it’s just too expensive for many small businesses. According to a recent National Federation of Independent Business survey, the most important reason that 65% of small employers don’t offer health insurance is that it costs too much. What small businesses and hardworking families need are market-driven solutions that let them pick the best health coverage for their own needs. We’ve tried trusting politicians to fix the healthcare mess. It’s time to trust people. John Reynolds is the Minnesota State Director for the National Federation of Independent Business (NFIB), which represents over 10,000 small businesses in Minnesota.

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Government-Run Health Insurance is False Hope

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