Dan McLaughlin

The Future of Health Care: Does Minnesota Have the Highest Health Insurance Rates?

Recently, the Minnesota Department of Commerce released the rate increases for individual policies purchased on MNSure. A study by the Kaiser Foundation found that they were the highest in the U.S., coming in at 28.7%. Is this really the case?

WCCO provides a useful overview of this issue here:

For individuals who purchase insurance on the exchange, the size of the increase is a problem. However, more than 80% of individuals purchasing insurance on health exchanges receive a subsidy, so the impact of the rate increases is softened. For example, an individual making $30,000 per year would only see an increase of 13%, which is high – but probably manageable. Because Minnesota health plans are catching up this year on their initial rates it is unlikely that we will see this large of an increase in the future.

The publicity surrounding these increases leaves the impression that health insurance is very expensive for everyone in Minnesota compared to the rest of the country and this is inaccurate. Data from the same study on the absolute rates – how much the insurance actually costs – shows a quite different picture. Here are the monthly rates for a 40-year-old nonsmoker in a sampling of U.S. states and cities:

State City 2015 Cost 2016 Cost Change
California Los Angeles $258 $245 -5.0%
Connecticut Hartford $322 $318 -1.3%
DC Washington $242 $243 0.7%
Maine Portland $282 $284 0.8%
Maryland Baltimore $235 $249 5.8%
Michigan Detroit $230 $226 -1.8%
Minnesota Minneapolis $183 $235 28.7%
New Mexico Albuquerque $171 $183 7.0%
New York New York City $372 $374 0.5%
Oregon Portland $213 $262 22.8%
Rhode Island Providence $260 $263 1.0%
Vermont Burlington $436 $468 7.3%
Virginia Richmond $260 $276 6.3%
Washington Seattle $254 $227 -10.4%
Average % change from 2015 4.4%

Minneapolis has the third-lowest rate in the county even after the rate increase. If you were buying health insurance in New York City you would pay $1,668 more per year compared to Minneapolis.


Join us November 6, 2015, at the annual St. Thomas Executive Conference on the Future of Health Care for honest dialogue with leaders and innovative thinkers in health care as they discuss the challenges their organizations are facing and the innovative approaches they are taking to address them.