canada africa partner reservation It’s time to remove for-profit healthcare organizations from Minnesota

It’s time to remove for-profit healthcare organizations from Minnesota

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It is taken as a given that competition among businesses is good, that the profit motive benefits the community, and that regulation harms the ability of businesses to prosper. But this premise does not make sense for healthcare.

Access to healthcare is a human right. No one should avoid care because he or she cannot afford it or because he or she is afraid of going bankrupt. No one should be denied or delayed care because an insurance company deems the care unnecessary, despite the opinions of the patient’s own health care providers. People should not endanger their health or lose their lives because of healthcare. But it happens every day.

That’s why we advanced HF 3529/SF 3543, the Non-Profit HMO Act, which restores Minnesota’s previous requirement that healthcare organizations be nonprofit. HMOs are a health insurance option that uses networks of healthcare providers to treat a patient population for a prepaid cost. The intention of healthcare organizations is to provide care that is both high-quality and cost-effective. It is therefore essential that healthcare organizations’ incentives to provide quality care do not come second to financial performance.

Both non-profit and for-profit healthcare organizations face this challenge. But adding the profit motive – where healthcare organizations have a fiduciary responsibility to maximize the profits of their investors – only leads to more frequent denial of care and bigger problems.

Until 2017, healthcare organizations in Minnesota were required to be local nonprofits. Their stated goal was to meet the needs of Minnesota communities. But that year, during negotiations over the state’s individual health care market, Republican lawmakers slipped the provision into the discussion and used it as a bargaining chip. No debate, no public hearings and no analysis.

This coincided with the growing dominance of large, mostly for-profit healthcare organizations, fueled by the profits to be made in the Medicare Advantage and Medicaid Managed Care markets. The data confirms this. Medicaid and Medicare Advantage are widely recognized as moneymakers for health insurers. The underwriting margins for these products – the amount of premium remaining after paying claims and administrative costs – are significantly higher than for insurers’ fully insured commercial operations. For the top five U.S. plans, the Medicare Advantage margin is 4.7%, compared to a 1% loss on all their other businesses.

The healthcare market is becoming increasingly consolidated and moving away from concerns about patient well-being. In the Medicare Advantage market, UnitedHealth Group had a 27% market share in 2022. It has been accused of fraud by a whistleblower, accused of fraud by the U.S. government, and overbilled for services, according to the U.S. Department of Health and Human Affairs. Office of the Inspector General.

The Office of the Inspector General said: “Managed Care Organizations in several states have inappropriately delayed or denied care for thousands of people enrolled in Medicaid, including patients needing treatment for cancer and heart problems, older patients, and patients with a disability who required home care. care and medical devices.” It points out that this puts people of color and people with lower incomes at greater risk for lower quality care and poorer outcomes.

The corporatization of healthcare is also spreading to other parts of the system, with disturbing results. Primary care providers have been targets for acquisition by insurers, private equity firms and hospital systems, hurting their ability to provide the best possible care to their patients. Likewise, nursing homes are increasingly owned by for-profit companies, negatively impacting quality even as profits rise.

Even non-profit organizations must bear the costs, have reserves and invest in their organizations. However, the primary responsibility of for-profit healthcare organizations is to shareholders and higher profits, not to better care for patients. It doesn’t sit well with Minnesota when healthcare organizations prioritize profit optimization over patient care.

Six years ago, when Republicans allowed for-profit health care organizations into Minnesota, there was no evidence that they would benefit the public, and there isn’t now. While the profit motive may have a place in classical capitalist economic theory, it is not the reality of what is best for our community health care, and it is certainly not the reality of what is best for Minnesotans in need of care.

It’s time to restore our previous standard and take some of the profits out of healthcare. The Non-Profit HMO Act returns Minnesota to requiring HMOs to be either a nonprofit or a local government. Let’s put people before profits and ban for-profit healthcare organizations now.

Liz Reyer, DFL-Eagan, is a member of the Minnesota House. John Marty, DFL-Roseville, is a member of the Minnesota Senate.