Minnesotans buying health insurance on the individual market face double-digit premium increases for 2027, with proposed hikes ranging from 10% to 13% across major insurers, according to a new report published by the Center of the American Experiment on June 24, 2026. The increases come one year after brutal rate hikes that averaged 21%, with Medica alone seeing an increase of over 30%. The report connects these rising costs to a larger problem: up to $9 billion was stolen from Minnesota taxpayers through Medicaid fraud, and state leaders rejected a proposal that could have saved over $300 million in fraud and improper payments.
The report details specific rate increases proposed for 2027: Blue Plus at 10.3%, HealthPartners Inc. at 12.4%, HealthPartners Insurance Co. at 12.3%, Medica Insurance Company at 13.0%, and Quartz Health Plan MN at 10.0%. Aspirus Health Plan Inc. is entering the Minnesota individual market as a new issuer. Noticeably absent is UCare, a 42-year-old company that went into receivership and folded last year. More than 1.2 million Minnesotans—one in five—are now on MNCare and Medicaid. The Minnesota Department of Commerce will finalize these rates in October, just weeks before Election Day, meaning voters will receive premium increase notices in the mail around the time ballots begin arriving.
The report states that Governor Walz and Democrats in the legislature rejected a proposal last year to save over $300 million in fraud and improper payments by requiring insurance companies to perform minimum checks before receiving taxpayer-funded payments on behalf of Medicaid enrollees. The proposed legislation would have required insurance companies to contact enrollees to verify that they live in the state and are still alive before continuing to receive monthly payments on their behalf. According to the report's author Matt Dean, "Walz and DFL leaders said no" to these basic verification measures. The report finds that voters were told their premiums would go up 25% if the state's reinsurance program wasn't passed, but after it was passed, premiums went up 25% anyway.
The report explains that subsidies, refinancing, and regulation have continued to grow spending in a state that needed to cut it. The inability to control spending has warped the economics of the market through intergovernmental transfers, sick taxes, and reinsurance. For UCare, those manipulations drove cost increases with no fundamental solutions to overspending, overutilization, and fraud that broke their business model. Reinsurance is a means by which insurance company risk is partially socialized to taxpayers, the report notes, but premium-paying customers haven't gotten a break. With sky-high premiums, the only way many families can keep the lights on is to accept very high deductibles, making most care an out-of-pocket expense for middle-class families in the individual market. The remaining premium-paying families and businesses are being pushed beyond the threshold of pain as more Minnesotans shift to taxpayer-supported plans.
The report concludes that when insurance premium increases are finalized weeks before Election Day, the timing "should give heartburn to anyone on the ballot accused of not doing enough to control health care costs." The report calls for focusing on the easiest way to lower health care costs: cleaning up the fraud mess. Minnesota families are now rationing care and essentially acting as their own insurers of last resort, with parents potentially delaying their own needed care or diagnostics to save out-of-pocket dollars for their kids.