By Christopher Snowbeck

Minneapolis Star Tribune

Big premium increases for next year are pushing more MNsure shoppers toward health plans with large deductibles.

It’s potentially a worrisome trend, since people who wind up getting sick and needing expensive health care could face thousands of dollars in extra out-of-pocket costs. That, in turn, could add up to more unpaid bills at hospitals and clinics.

But as MNsure approaches its first key enrollment deadline Monday, it’s not clear whether the early preference for what are known as “bronze” health plans is a lasting problem.

For some people the policies work out well — particularly if they’re in good financial and physical health. Plus, the early bronze shift might not last with deadline surges in enrollment expected this month and in January.

“It’s too early to make predictions,” said Eileen Smith, spokeswoman for the Minnesota Council of Health Plans, a trade group for health insurers. “We expect to see more people buying on MNsure, but we still don’t know how many people that will be, and what they will be buying.”

MNsure is an option for individuals and families who buy health insurance on their own, rather than having coverage from an employer or the government. Currently, about 300,000 Minnesotans buy policies in the individual insurance market, with most buying directly from insurers.

The federal health law that created the health insurance exchange also stipulated that policies would be grouped into “metal levels” — platinum, gold, silver and bronze. Platinum policies have the richest benefits, while bronze plans cover the smallest share of an enrollee’s costs.

During the first year of MNsure, premiums in the Twin Cities and other parts of the state were so low that platinum policies with very low deductibles were both affordable and popular. The popularity plunged with premiums jumps this year, and insurers next year won’t even sell platinum policies through the exchange.

Now, it’s the bronze plans that are commanding attention. They were the choice for 50 percent of the 17,678 people buying through MNsure as of Dec. 8, up from a 34 percent share one year earlier.

Numbers weren’t available for the “off-exchange” portion of the individual market, but two insurers said there were early indications of more bronze policies being sold there, as well.

The shift is clear at Crosstown Insurance in New Hope, where owner Shawnee Christenson said health insurance shoppers are responding to large premium jumps. Rates in the individual market are up an average of 41 percent next year.

Some people who opt for bronze plans have the savings to cover costs in a bad year, Christenson said, so the change won’t be a problem. But in other cases, people don’t have the money to pay large medical bills that come as a surprise.

Care providers could have trouble collecting payments from patients as a result.

“People are betting that they’re not going to need a hospitalization, and they’ll save the $70 per month in premium,” Christenson said. “It starts to become ‘you pay now or you pay later’ — if something happens.”

Such bets can prove costly, though. To better illustrate the tradeoffs, MNsure launched an online tool that lets consumers compare plans not just in terms of premiums, but also expected out-of-pocket costs.

It’s difficult to generalize about what the online tool tells consumers, because the best deal depends on a wide variety of factors, said Peter Benner, the MNsure board chair. Beyond looking at premiums and deductibles, the decision touches on income, savings, geography, appetite for risk and health status.

Looking at options in the Twin Cities, a consumer buying a gold policy might have out-of-pocket costs capped at $2,350, Benner said, compared with a limit of $6,850 on out-of-pocket costs with a bronze plan. Which is the right choice?

“If my personal financial situation says I can float that out-of-pocket hit [with the bronze plan] if it comes, that’s one thing,” Benner said. “If my personal situation says: No, I am better off doing a monthly budget in effect, then I’m probably going to buy-up to that silver or that gold plan.”

It’s too soon to say whether the preference thus far for bronze plans among MNsure shoppers is a problem, Benner said. Buying such a policy could be a rational decision, he said, for a healthy person with financial resources, particularly in a year with no medical surprises.

“The downside is: You are really exposed for that bad year,” Benner said.