1 September 25, 2007 State Coverage Institute: Minnesota

2 Minnesota has the nation’s lowest rate of uninsurance  About half the national uninsured rate of 15.3%  Historically high rate of private insurance coverage  Expansive public programs compared to most other states Background

3 Concern About Erosion of Private Coverage Between 2001 and 2004, our state surveys showed:  Falling rate of employer-based coverage (from 68.4% to 62.9%) Caused by declining access to coverage, not declining “take- up” rates  Rising enrollment in public programs (from 21.2% to 25.1%)  Increase in uninsurance rate (from 5.7% to 7.4%) First documented increase since surveys began in 1990

4 Connection Between Costs and Coverage Rising costs have contributed to the erosion of private coverage Pressure on public programs from both:  Rising cost per person  Increasing enrollment (as private coverage falls)

5 Need for Comprehensive Reform Universal health insurance coverage cannot be achieved in a sustainable way without other fundamental reforms to contain costs and to improve quality/ efficiency of the system

6 Coverage Institute: Minnesota’s Goals Payment reform  Current payment systems reward volume, not value  “You get what you pay for”: Need to fundamentally change financial incentives to reward quality, efficiency, care coordination, and prevention Improve insurance markets  Strategies to stop/reverse erosion of private coverage  Improve affordability, transparency, and overall market functioning

7 Part of Larger Reform Efforts in Minnesota: Governor’s Health Care Transformation Task Force  Must report by February 2008 on action steps to (among other things): Reduce health care expenditures by 20% by 2011 and limit future growth to CPI plus 2% Ensure all Minnesotans have coverage Improve quality and safety; reduce disparities Improve health status and reduce preventable illness Legislature’s Health Care Access Commission  Must report in January 2008 on how to achieve universal coverage  Examining many of the same issues and strategies as the Transformation Task Force