New Census data highlight what’s at risk from federal health care threats

The share of Minnesotans covered by health insurance is historically high, according to new U.S. Census data released today. Minnesota was already a national leader on this front before the Affordable Care Act (ACA) provided our state with even more tools to connect Minnesotans with affordable health insurance.

In 2016, only 4.1 percent of Minnesotans went without health insurance. That’s an improvement over the 4.5 percent who lacked coverage in 2015. And it’s also markedly lower than the 8.2 percent of Minnesotans who went without insurance in 2013, the last year before the full rollout of the ACA.

Our low uninsurance rate is good enough to rank Minnesota fifth among the 50 states and Washington, D.C. However, Minnesota’s progress – and that of states across the country that have seen improvements in their health care coverage rates – is currently under threat.

Health care legislation proposed in the U.S. Congress would slash federal funding on health care assistance, for both Medicaid and the individual market. More than 1 million Minnesotans find affordable insurance through Medicaid, called Medical Assistance in Minnesota. Federal assistance to bring down the cost for those getting health insurance through the individual market means that many Minnesotans are shielded from increasing premiums, and also pay less for other out-of-pocket costs than they would have before the ACA.

Our avenues to affordable health insurance improve Minnesotans’ lives in many ways. Most obviously, participation in Medicaid has been linked to better overall health, and people insured through Medicaid are generally able to find health care similar to those with employer-based coverage. Children covered through Medicaid perform better in school, too. And following recent gains in health insurance coverage, less strain has been placed on our health care providers from bad debt or uncompensated care.

The ACA, Medical Assistance, and MinnesotaCare also play critical roles in reducing barriers for Minnesotans who have struggled to afford health care insurance. The pathways to affordable health insurance offered through the ACA undeniably benefited people who traditionally have had less access to health care coverage: people of color, young adults, part-time workers, those with less formal education, and those in low-income families.

But threats remain. In the U.S. House of Representatives, legislators approved giant cuts to Medicaid that finance huge tax cuts for high-income Americans, and insurance and other medical industry companies. Meanwhile, senators are still considering a proposal that would deeply cut federal funding for health care and remove important protections for people with pre-existing conditions.

The past several years, Census data on health insurance has told a story of how public policies have meant more Americans can afford health care for themselves and their families. Policymakers should build on that success instead of pulling the rug out from underneath the Americans who live and thrive because of it.

-Ben Horowitz and Clark Goldenrod

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Cassidy-Graham: Different lipstick, same pig

U.S. Senators are reportedly still considering a health care bill that would leave millions of Americans uninsured, eliminate protections for expectant mothers and people with mental illnesses, and threaten the stability of state budgets. Known as the Cassidy-Graham plan, this latest version contains many of the bad ideas of its predecessors along with some provisions that are harmful and novel.

Like its predecessors, Cassidy-Graham would:

  • Create massive funding cuts to Medicaid and reduce federal assistance for people buying insurance on the individual market by changing their federal funding mechanisms, resulting in a $2.1 billion annual loss for Minnesota by 2026;
  • Eliminate protections for people with pre-existing conditions by allowing states to waive consumer protections established by the Affordable Care Act (ACA), and by potentially adopting the Cruz Amendment;
  • Cause millions of people to lose their health insurance; and
  • Leave people on the individual insurance market paying more in out-of-pocket costs.

Additionally, Cassidy-Graham eliminates all funding for the ACA’s Medicaid expansion and marketplace subsidies after 2026. The additional Medicaid cuts come on top of the aforementioned $2.1 billion reduction in annual funding for Minnesota. Both policy changes would leave big holes in our state budget, threatening the coverage of the more than 1 million Minnesotans who access affordable health care through Medical Assistance — many of whom are working, caring for a disabled relative, have been laid off, or are dealing with a disability.

The elimination of marketplace subsidies after 2026 would mean that people who aren’t offered insurance through their employer would no longer receive any help to bring down the cost of their health insurance on the individual market — costs that would go up even more under Cassidy-Graham.

Cassidy-Graham also threatens a uniquely Minnesotan and successful avenue to affordable health insurance for people who earn too much to qualify for Medicaid. The bill would reduce funding for MinnesotaCare, placing more than 90,000 Minnesotans’ health insurance in jeopardy. MinnesotaCare covers Minnesotans who earn less than 200 percent of the federal poverty guidelines ($24,120 for a single individual). Since costs on the individual market will also increase under Cassidy-Graham, these Minnesotans are likely to lose their coverage without being offered an affordable alternative.

Just like previous attempts that would reduce the assistance for health insurance available to Americans through the ACA, Cassidy-Graham has been crafted behind closed doors. The proposal is not significantly different from the one that died on the Senate floor last month. A few tweaks around the edges cannot save a bill that is rotten to its core.

Instead of drawing on proposals crafted in the shadows, senators should return from their summer recess and work on strengthening the ACA in a transparent, bipartisan fashion. Right now, the number of people without health insurance represents the lowest share of uninsured Americans ever. Any step in the opposite direction is unacceptable.

-Ben Horowitz


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Join us in telling Congress to reject the U.S. House plan to pay for tax cuts for the wealthy by decimating the safety net

No matter how hard somebody works or tries to do the right thing, a simple twist of financial fate can leave most Americans struggling to afford the most basic necessities. The budget plan awaiting a vote in the U.S. House of Representatives would devastate the investments we make in services that connect Americans with food, shelter, education, job training, and health care during troubled times. The proposed budget cuts cuts would have implications for everyone, from an infant whose parent struggles to buy formula to a senior whose family can’t afford long-term care. At the same time, the budget would give massive tax breaks to the wealthiest Americans and most profitable corporations through a special fast-track budget process.

We have penned a letter to Minnesota’s congressional delegation calling on them to oppose this upside-down budget, and we’re asking your organization to lend its voice. Our deadline for signatories is August 24. Read the letter and sign-on instructions here, and contact Ben Horowitz for more information.

-Ben Horowitz

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US Senate votes mean Medicaid and affordable health insurance for millions of Americans are preserved for now

Several proposals to radically alter health insurance for the worse failed in the U.S. Senate last month. Congress should now turn to policy solutions that strengthen Americans’ ability to find affordable, quality health insurance. In the meantime, advocates should be prepared for the potential next wave of attacks on the health insurance safety net.

Earlier this spring, the U.S. House of Representatives voted to cut more than a trillion dollars from health care funding for low- and moderate-income Americans, while at the same time cutting taxes for the nation’s highest-income people, insurance companies, and the medical device industry. Once the bill came to the U.S. Senate, Senate leaders tinkered with it behind closed doors before unveiling a series of amendments that also threatened to undo many of the coverage and patient-protection gains made under the ACA without effectively addressing any of the problems Americans still face when they shop for insurance.

These Senate proposals differed in their details, but all shared a few things in common. Like the House bill, they would have essentially ended the protections for people with pre-existing conditions, cut funding for people who are insured through Medicaid or receive subsidies to shop on the individual market, and would have left 22 to 32 million more people without health insurance within a matter of years.

A last-ditch effort to move American health care in the wrong direction failed to pass in a dramatic, late-night vote in the Senate after an incredible groundswell of support for Medicaid, through which millions of Americans find affordable care. Unfortunately, these proposals are unlikely to be the last attempts to roll back access to affordable health insurance in the coming months.

President Donald Trump and Congressional leaders have proposed budget plans that would decimate the safety net that connects vulnerable Americans with basic necessities like food and shelter. The current House budget plan suggests dramatic reductions in Medicaid, and the Trump budget similarly proposed cuts on top of what was included in the stalled Congressional health care legislation.

On top of the damage that would be done by these proposals, Trump has added uncertainty to the current market by threatening to withhold funding that lowers the costs of health care for low-income families. This threat could result in some insurers raising premiums for 2018.

It’s now time for Congress to build on the gains made under the ACA. The share of Americans without health insurance is at an all-time low. The remaining challenge: how to ensure that all Americans — regardless of age, pre-existing conditions, or locality — can afford both the monthly premiums and the cost of health care for a comprehensive health insurance plan.

That requires stabilizing the health insurance market, lowering premiums for those who find them out of reach, and controlling the costs of providing health care. Simply cutting our public investments in affordable health insurance won’t do the trick.

-Ben Horowitz

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Opportunity out of reach for some communities in Minnesota

Too many families face persistent financial insecurity, and the situation is often much worse for Minnesota’s households of color. That’s from a new report from Prosperity Now (formerly the Corporation for Enterprise Development or CFED). Prosperity Now finds that Minnesota does well on many aspects of its annual scorecard that measures assets and opportunities within each state, but many families face hurdles in their dreams of both making ends meet and preparing for the future.

On Track or Left Behind? measures financial security and opportunities to climb the economic ladder in all 50 states and Washington, D.C., focusing on five issue areas:

  • Financial assets and income,
  • Businesses and jobs,
  • Homeownership and housing,
  • Health care, and
  • Education.

Minnesota ranks fifth highest for outcomes. Even so, over 20 percent of Minnesotans don’t have enough liquid assets, such as savings accounts, to even live at the poverty level for three months if they suddenly lost their jobs. This means 1 in 5 Minnesotans could be one setback away from falling into poverty.

Many Minnesotans, in addition to not having significant savings, do not have stable incomes. Stable incomes are a cornerstone of prosperity, making it easier for families to save and plan for their futures. One in four workers in Minnesota reported that their income varied “somewhat to a lot” from one month to the next, one of the highest rates in the United States.

It’s clear that Minnesota has a ways to go to expand opportunity to all Minnesotans. The report shows that Minnesota has some tremendous gaps in financial security between white residents and people of color, and these gaps are often due to systemic barriers.

The homeownership rate for white households is twice the rate for households of color. Black Minnesota households face particular barriers to homeownership. Only 22 percent of Black households own a home, while 76 percent of white Minnesota households do.

In Minnesota, the difference between poverty rates experienced by households of color and white households is one of the largest in the nation. Households of color in Minnesota are more than three times more likely to have incomes below the federal poverty threshold than white Minnesotans. Black Minnesotan households live in poverty at a rate of almost four times that of white households.

Minnesotans of color are also over three times more likely than white Minnesotans to be unemployed, one of the highest employment gaps in the nation. Minnesotans of color clearly face significant barriers in their quest for jobs and financial security.

Additionally, Black and Hispanic Minnesotans are more than twice as likely to forgo a doctor’s visit due to cost than white Minnesotans. Despite the recent narrowing of racial gaps in access to health insurance, in part thanks to the Affordable Care Act, the uninsurance rate for households of color in Minnesota is still three times that of white Minnesotans. The disparity is worst for Hispanic Minnesotans, who are uninsured at almost six times the rate of white Minnesotans.

The Prosperity Now report acknowledges the policies that Minnesota has already put in place to support families in attaining financial stability, but also provides a road map for how to make further progress. And policy changes are an especially important tool to close racial disparities in access to opportunity, since policies have contributed to these differences. For example, discriminatory housing policies like redlining made it very difficult for Black Americans to purchase homes, which also contributes to a generational wealth gap.

Prosperity Now notes the importance of tax policies in families’ ability to earn enough to afford basic needs and to save for a more secure future. In Minnesota, lower-income people pay a larger share of their incomes in state and local taxes than those with the highest incomes. Prosperity Now gives Minnesota high marks for having a strong state Earned Income Tax Credit (the Working Family Tax Credit). And in the 2017 Legislative Session, policymakers expanded the Working Family Credit, including allowing younger workers without children to qualify, a nation-leading improvement, and reducing barriers to accessing the credit faced by Native American families.

Additionally, Minnesota has made progress in making college more accessible. The scorecard commends Minnesota for targeting financial aid to students with the highest need and extending in-state tuition to undocumented students who meet certain criteria.

But we still have a long way to go. Too many Minnesotans across the state do not have access to earned sick leave, so they can lose wages or even their jobs if they take time off to recover from the flu or take their child to the doctor. The scorecard also highlights the need for housing policies that protect Section 8 voucher holders from discrimination, and a higher state minimum wage to better help Minnesota workers make ends meet.

-Clark Biegler and Nathan Williams

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US House budget: Trading access to health care, SNAP for tax cuts for wealthy, defense spending

The U.S. House has released their budget resolution – or the framework they propose to use to pass a budget in the upcoming months. The budget resolution is an important step in the budget-setting process and sets an overall vision for the next 10 years. And the U.S. House’s vision is frightening. It calls for trillions of dollars in cuts to investments in our economy and assistance that helps Americans afford the basics to fund a large increase in defense spending and huge tax cuts, the bulk of which are likely to go to the wealthy and profitable corporations. Additionally, the budget resolution proposes to enact many of the entitlement and tax cuts through a fast-track process called “reconciliation,” which only requires a simple majority in the Senate to pass.

The House budget proposal includes:

  • $4.4 trillion in cuts over 10 years to entitlements, which include cuts to Medicaid, Medicare, the Supplemental Nutritional Assistance Program (SNAP, also known as food stamps), and Pell Grants. This would mean steep reductions in the ability of Americans across the country to access health care, put food on the table, and afford college. For example, it would cut the maximum Pell Grant amount for very low-income students by $1,060, or close to 20 percent. The House’s budget plan also would cut basic food assistance through SNAP by more than 20 percent over 10 years through both direct funding cuts and shifting funding responsibility to the states for the first time. This will stretch states’ more limited resources and will likely increase hunger across Minnesota.
  • $1.3 trillion in cuts to non-defense discretionary funding over 10 years, the part of the budget that includes important job training, public health, and many other programs that build strong communities, whose funding levels are set each year through the appropriations process. This area of the budget is already subject to strict funding caps – called sequestration. The House budget would cut ever more deeply, and by 2027, non-defense discretionary funding would be 44 percent below its 2010 level, after adjusting for inflation.
  • $929 billion in increased defense spending over 10 years. Defense spending is currently subject to caps like non-defense discretionary, but the House resolution funding increase is so large it would surpass even pre-sequestration funding levels by $19 billion. This would end the practice of treating defense and non-defense equally when lifting sequestration caps.
  • A directive for tax cuts that would overwhelmingly benefit the top 1 percent of U.S. households. While the budget resolution itself doesn’t include the full policy details, the priorities laid out would set a lower top tax rate for certain businesses, which would primarily benefit wealthy investors. Proposals also would repeal the Alternative Minimum Tax, which currently prevents very high-income households from using so many exemptions in the tax system that they pay little to no income taxes.

While specific line items might differ, the House budget resolution closely mirrors the priorities of President Donald Trump’s budget proposal and would be devastating for Americans. Also similar to the president’s proposed budget, the House resolution is built on a set of false assumptions and huge “magic asterisks” that hide the real effects of the budget. For example, the House resolution relies on unrealistic economic growth expectations and assumes $700 billion in savings with no plan to produce them.

The full House is expected to vote on the budget resolution in September when they return from the August recess. House members should reject such a skewed vision for the United States and instead craft a bipartisan plan that makes investments that support communities. At the same time, the House is already working on bills that flesh out the details. Check out the Minnesota Council of Nonprofits’ federal policy website and its federal budget tracker and federal appropriations infographic for more details.

-Clark Biegler

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U.S. Senate still considering harmful health care bills

Republicans in the U.S. Senate are reportedly working on health care legislation that could come up for a vote as early as next week. Unfortunately, the two proposals they are working from would be a disaster for Minnesotans. Both the Better Care Reconciliation Act (BCRA) and the Obamacare Repeal Reconciliation Act (ORRA) would make billions of dollars in cuts to health care supports that reach more than a million Minnesotans.

Policymakers continue to discuss minor tweaks to these fundamentally flawed bills. That means Minnesotans, including the elderly, people with disabilities, and those with low incomes, still face threats to their ability to find affordable health care. The country’s senators and representatives should admit that these health care bills cannot be fixed, and instead focus on improving Americans’ access to health insurance.

The BCRA and ORRA would both cut Medicaid by more than $750 billion over a decade. This will inevitably put treatment and care out of reach for some of the more than 1 million Minnesotans who can only find affordable heath insurance through Medical Assistance, our state’s tried-and-true Medicaid program.

That’s because Medicaid is already targeted to our most vulnerable neighbors. In Minnesota, 84 percent of the money spent on Medical Assistance is spent on health care for seniors, people with disabilities, and families with children, and the remainder covers people with no other options for affordable health insurance. Of Medical Assistance’s non-elderly adults without disabilities, two-thirds live in a family with at least one full-time worker. Nationally, the unemployed served by Medicaid are likely to be caring for a relative, or to be laid off. All struggle to make ends meet on very low incomes.

Like the Affordable Health Care Act (AHCA) passed by House Republicans, the Senate’s BCRA would cut $31 billion in Medicaid funding for Minnesota over about 10 years. By one estimate, the BCRA could increase the number of non-elderly Minnesotans without insurance by 334,000 in 2022, more than double the number expected to be uninsured under current law. These cuts are achieved by arbitrarily capping federal Medicaid funding and effectively ending the Medicaid expansion. The bill would also raise health care costs for many people buying insurance on the individual market, and severely weaken protections for those with pre-existing conditions. While it makes some tweaks to earlier versions, the outcome is essentially the same: the most recent estimate of the BCRA projects that 22 million more Americans would be left without health care by 2026.

At the same time the bill makes radical reductions in assistance for affordable health care, it bestows hundreds of billions of dollars in tax cuts on wealthy Americans, insurance companies, and other medical industry players.

The ORRA is a piece of legislation that would simply repeal the Affordable Care Act (ACA) without putting anything in its place to assist those who struggle to afford health insurance. It would give the wealthy and the health care industry the lion’s share of $606 billion in tax breaks, eliminate the Medicaid expansion, and destroy all of the assistance to bring down costs built by the ACA while offering no alternative in its stead. The nonpartisan Congressional Budget Office estimated that it would leave 32 million more Americans uninsured in 2026.

The ACA made comprehensive health insurance affordable for millions of households for the first time. Policymakers should investigate ways to strengthen the gains of the past few years by making comprehensive health insurance affordable to all Americans instead of pulling it away from those who often need it the most.

-Ben Horowitz

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Minnesota’s July economic update shows slightly lower revenues, economic growth on track

This week’s July Revenue and Economic Update gave us mixed news about the state’s economic and budget landscape. The quarterly report from Minnesota Management and Budget (MMB) showed that state revenues have come in slightly below projections but national economic growth is expected to be on track with earlier projections for the next few years.

Some of the top takeaways from the Update include:

1. FY 2017 revenues just below projections. The state’s 2017 fiscal year ended on June 30, and revenues for the year came in $104 million below projections; that’s 0.5 percent less than projected in the state’s February 2017 Economic Forecast. This is due primarily to lower than expected income tax receipts and higher than expected income tax refunds. These are only preliminary numbers, and the final FY 2017 revenues will be included in the October economic update. However, the lower income tax revenues are consistent with other data that suggest that wage and salary income is growing more slowly than earlier projections. Another factor that could be influencing the lower income tax payments noted in the Update is that some taxpayers may have held off on realizing capital gains in 2016, anticipating potential federal tax cuts.

2. Continued national economic growth projected for 2017 and onward. The national economic forecasters continue to predict 2.3 percent national economic growth for 2017 and for growth to jump to 2.7 percent in 2018; these are the same economic predictions as in the February forecast. However, the state’s economic forecasters note that this projected growth is based on the assumption that federal policymakers will enact tax reductions and increase infrastructure spending. Without these federal policy changes, growth in 2018 is expected to be around 2.3 percent.

3. The national unemployment rate is expected to fall further. Despite a slight recent uptick in the national unemployment rate, it has decreased by 0.4 percentage points this year to date. The national unemployment rate is expected to fall to 3.9 percent by 2019.

4. Despite uncertainty around federal policy changes, forecasters are fairly confident in their projections. The forecasters assign a 60 percent chance to their baseline forecast. They also give a 25 percent chance for a more pessimistic scenario and assign a 15 percent probability to a more optimistic scenario.

This week’s Update brings us relatively good news on the national economy, but reason for caution. These numbers don’t measure the impact on Minnesota of potential serious federal funding cuts. President Donald Trump has proposed, and the U.S. House and Senate have considered, deep cuts to federal funding to the states. For example, the Senate’s health care bill would cut health care funding to Minnesota by about $2 billion over 18 months, and threaten the health care of about 1 million Minnesotans. In addition, Trump’s budget proposes about $18 billion in cuts to grants to states and local governments that support critical services, such as housing and poverty-reduction efforts.

The budget that Minnesota policymakers passed in the the 2017 Legislative Session left very little of the projected surpluses on the bottom line. As a result, the responsibility of meeting the needs of Minnesotans in the face of uncertainty has gotten tougher.

-Clark Biegler

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Takeaways from U.S. Senate health care proposal: 22 million more uninsured, higher costs for many

On June 22, Republicans in the U.S. Senate revealed their Better Care Reconciliation Act (BCRA) proposal to “repeal and replace” the Affordable Care Act (ACA), also known as Obamacare. This bill also includes dramatic cuts to health care for seniors, people with disabilities, children and others through Medicaid, as well as $563 billion in tax cuts, primarily for wealthy Americans and the medical industry. Last week the nonpartisan Congressional Budget Office (CBO) released an analysis of the bill, which estimated that if it became law, millions more Americans would live without health insurance by 2026.

Here are a few key findings from the analysis:

  1. The BCRA will mean 22 million more people would lack health insurance by 2026 relative to current law. This means in 2026, 49 million people in the United States will be uninsured, reversing the historic gains in health care coverage made since the passage of the Affordable Care Act.
  2. Medicaid, which provides health insurance to low-income families and children, the elderly, and people living with disabilities, would be cut by $772 billion over the next 10 years. As a result, 15 million fewer people would have health insurance through Medicaid, that they count on to see the doctor when they have the flu, to help manage their diabetes, or when they’re older and need long-term nursing home care.
  3. The cost of health insurance through the individual market would increase substantially for many, especially for older Americans. Under current law, a 64-year-old with an annual income of $56,800 faces an annual premium of $6,800 for a typical health insurance plan. Under BCRA, that premium would be over three times as much, and would take up more than one-third of their income.

The U.S. Senate is expected to vote on this bill after the July 4th recess. While negotiations will be ongoing and minor details could change, the Senate’s proposal would be extremely harmful for millions of Americans. U.S. Senators should reject this bill and instead come up with a plan that builds on the successes of the ACA by further increasing the number of people with quality health insurance and lowering health care costs for all Americans.

-Clark Biegler

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We’re hiring for a fall research internship

The Minnesota Budget Project seeks a research intern who will make a significant contribution to our work on state immigration policy and economic trends affecting immigrants in Minnesota. This intern will conduct research and work with Minnesota Budget Project staff to produce analytic materials. The ideal candidate will have strong quantitative, qualitative and data analysis skills.

The Minnesota Budget Project is an initiative of the Minnesota Council of Nonprofits that combines sound research and analysis with advocacy, engagement and communications strategies to support policies that expand opportunity and economic security to all Minnesotans.

This is a paid internship. More information, including how to apply, is available on the Minnesota Council of Nonprofits website. The application deadline is Wednesday, July 12.

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