Beyond covering $19.3 billion in medical expenses, the state’s nonprofit plans dedicated more than $180 million to improving health quality for 2.6 million Minnesotans
Minnesota’s six nonprofit health plans continued supporting Minnesotans’ access to affordable, quality care in 2023, paying $19.3 billion in medical bills on behalf of 2.6 million people enrolled in fully insured or government programs, the Minnesota Council of Health Plans announced today. The Council’s member health plans, Blue Cross and Blue Shield of Minnesota, HealthPartners, Hennepin Health, Medica, Sanford Health Plan of Minnesota, and UCare, reported a collective revenue of $20.8 billion and an operating margin of 0.65% for the year.
As mission-based, nonprofit organizations, the Council’s member health plans use this operating margin to maintain statutorily required medical reserve funds and to improve access, quality, and outcomes to benefit Minnesotans.
“The Council’s member plans continue to demonstrate responsible stewardship of Minnesota’s premium dollars, balancing many competing demands, including growing medical costs, higher utilization, and needed investment to advance high-quality, affordable care across the state,” said Lucas Nesse, President and CEO of the Minnesota Council of Health Plans.
Along with the 2.6 million Minnesotans enrolled in fully insured and government program coverage, Council members also administer coverage for large, self-insured employers that fund insurance for 2.2 million employees. In total, Council members support the health and well-being of 4.8 million Minnesotans.
Behind the numbers, growing health care costs and enrollment changes
The unwinding of policies tied to the federal pandemic health emergency which expired in early 2023 led to significant changes in enrollment in the state’s Medicaid programs. The return to annual eligibility procedures or “redetermination” has been a substantial undertaking and major challenge for the state to ensure no one covered by these programs loses coverage inappropriately. The nonprofit health plans have played a critical role in ensuring Minnesotans have the support they need to navigate this process and stay connected to care.
The end of pandemic-era policies also led to shifts in federal funding for tests, vaccines, and treatment, which contributed to continuing increases in the cost of health care and utilization. 2023 saw a rise in medical expenditures of 8.5% over 2022 to more than $19.3 billion or more than $7,300 per enrollee.
From 2019-2023, overall medical costs have increased by more than 36%. During that same five-year period, pharmaceutical costs significantly outpaced overall spending, growing by 48%, representing about 17% of all expenditures.
Reinsurance continues to drive affordability in the individual market
The state’s premium security program, known as “reinsurance,” continued to help insurers cover individuals with high medical expenses so that these significant costs weren’t included in premiums. This program is funded through 2025 and helps more Minnesotans to access affordable individual and family health plan coverage. With about 160,000 Minnesotans relying on the individual market for coverage through the nonprofit plans in 2023 (an enrollment increase of 6% over the previous year) maintaining stability and affordability in this market is paramount.
“Minnesota’s proven premium security program has been a key factor in keeping coverage affordable and contributing to the state’s current record low uninsured rate. Continued state support for this successful program is critical to maintain stability for the many Minnesotans who rely on this market for affordable coverage,” said Nesse.
The nonprofit plans invested more than $180 million in improving health quality for Minnesotans across the state
The state’s nonprofit plans provide critical support to Minnesotans to help them access high-quality, equitable care. Beyond paying over $19.3B in medical claims, Council members invest significantly to improve health care access, quality, and outcomes. For example, the plans dedicated over $180M in Health Quality expenses in 2023, to support critical needs, including:
- Improving access to behavioral health care through support for Behavioral Health Homes and Certified Community Behavioral Health Clinics.
- Health Education events to provide COVID and flu vaccines with key communities.
- Improving access and engagement through support for Community Health Workers and Targeted Case Management.
- Improving access and quality in key areas, like maternal health, dental health, and chronic conditions.
- Support for community pharmacies to provide patient-centered care plans to improve engagement, medication adherence, and overall health.
“The nonprofit plans provided critical support to Minnesotans across the state last year as many navigated enrollment and coverage changes driven by the end of pandemic-era policies,” Nesse said. “They worked closely with individuals, employers, providers and the state to ensure Minnesotans maintained coverage and to improve access to high-quality and equitable care.”
Note: The financial results reported for 2023 are an industry average and therefore vary by individual health plan.
Established in 1985, the Minnesota Council of Health Plans is an association of licensed nonprofit health plans that includes: Blue Cross and Blue Shield/Blue Plus of Minnesota, HealthPartners, Hennepin Health, Medica, Sanford Health Plan of Minnesota and UCare.