SF 55

1st Engrossment - 90th Legislature (2017 - 2018) Posted on 01/12/2017 08:36am

A bill for an act
relating to health care; providing for verification of eligibility for premium
assistance; providing that certain health plan rate data are public; establishing a
state reinsurance program; amending Minnesota Statutes 2016, section 60A.08,
subdivision 15; proposing coding for new law in Minnesota Statutes, chapter 62E.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

ARTICLE 1

PREMIUM ASSISTANCE

Section 1.

Minnesota Statutes 2016, section 60A.08, subdivision 15, is amended to read:

Subd. 15.

Classification of insurance filings data.

(a) All forms, rates, and related
information filed with the commissioner under section 61A.02 shall be nonpublic data until
the filing becomes effective.

(b) All forms, rates, and related information filed with the commissioner under section
62A.02 shall be nonpublic data until the filing becomes effective.

(c) All forms, rates, and related information filed with the commissioner under section
62C.14, subdivision 10, shall be nonpublic data until the filing becomes effective.

(d) All forms, rates, and related information filed with the commissioner under section
70A.06 shall be nonpublic data until the filing becomes effective.

(e) All forms, rates, and related information filed with the commissioner under section
79.56 shall be nonpublic data until the filing becomes effective.

(f) Notwithstanding paragraphs (b) and (c), for all rate increases subject to review under
section 2794 of the Public Health Services Act and any amendments to, or regulations, or
guidance issued under the act that are filed with the commissioner on or after September 1,
2011, the commissioner:

(1) may acknowledge receipt of the information;

(2) may acknowledge that the corresponding rate filing is pending review;

(3) must provide public access from the Department of Commerce's Web site to parts I
and II of the Preliminary Justifications of the rate increases subject to review; and

(4) must provide notice to the public on the Department of Commerce's Web site of the
review of the proposed rate, which must include a statement that the public has 30 calendar
days to submit written comments to the commissioner on the rate filing subject to review.

new text begin (g) Notwithstanding paragraphs (b) and (c), for all rates for individual health plans, as
defined in section 62A.011, subdivision 4, and small employer plans, as defined in section
62L.02, subdivision 28, the commissioner must provide:
new text end

new text begin (1) public access to the information described in clause (2) from the Department of
Commerce's Web site within ten days of receiving a rate filing from a health plan, as defined
in section 62A.011, subdivision 3; and
new text end

new text begin (2) compiled data of the proposed change to rates separated by health plan and geographic
rating area.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective 30 days following final enactment.
new text end

Sec. 2. new text begin TRANSITION OF CARE COVERAGE FOR CALENDAR YEAR 2017;
REQUEST FOR AUTHORIZATION.
new text end

new text begin (a) The definitions in Minnesota Statutes, sections 62A.011 and 62Q.01, apply to sections
2 to 5.
new text end

new text begin (b) An enrollee's health plan company may require medical records and other supporting
documentation to be submitted with a request for authorization for transition of care coverage.
If authorization is denied, the health plan company must explain the criteria used to make
its decision on the request for authorization and must explain the enrollee's right to appeal
the decision. If an enrollee chooses to appeal a denial, the enrollee must appeal the denial
within five business days of the date on which the enrollee receives the denial. If authorization
is granted, the health plan company must provide the enrollee, within five business days of
granting the authorization, with an explanation of how transition of care will be provided.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for health plans issued after December
31, 2016, and before March 2, 2017, and that are in effect for all or a portion of calendar
year 2017. This section expires June 30, 2018.
new text end

Sec. 3. new text begin INFORMATION FROM HEALTH PLAN COMPANIES.
new text end

new text begin (a) The commissioner of management and budget shall require a health plan company
to provide to the commissioner the following information on an individual who has applied
for health care premium assistance:
new text end

new text begin (1) whether the individual is covered by the health plan;
new text end

new text begin (2) the qualified premium for the coverage;
new text end

new text begin (3) whether the coverage is individual or family coverage;
new text end

new text begin (4) whether the individual is receiving advance payment of the credit under section 36B
of the Internal Revenue Code; and
new text end

new text begin (5) any additional information the commissioner determines appropriate to administer
the program.
new text end

new text begin (b) A health plan company must notify the commissioner of coverage terminations of
eligible individuals within ten business days.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day following final enactment and
expires on July 1, 2018.
new text end

Sec. 4. new text begin VERIFYING ELIGIBILITY FOR PREMIUM ASSISTANCE; PROGRAM
INTEGRITY.
new text end

new text begin Subdivision 1. new text end

new text begin Verification of residency. new text end

new text begin The commissioner of management and budget
shall verify that persons applying for health care premium assistance are residents of
Minnesota. The commissioner has access to data of the Department of Employment and
Economic Development and the Department of Revenue for purposes of verifying residency.
new text end

new text begin Subd. 2. new text end

new text begin Program integrity. new text end

new text begin The commissioner of revenue has access to and shall
review data from the Department of Management and Budget, the Department of Human
Services, MNsure, and the taxable year 2016 tax returns to identify ineligible individuals
who received health care premium assistance or individuals who received premium assistance
in excess of the amount to which they are entitled. The commissioner of revenue shall
recover the amount of any premium assistance paid on behalf of an ineligible individual or
the amount in excess of the amount to which an individual is entitled, in the manner provided
by law for the collection of unpaid taxes or erroneously paid refunds of taxes.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day following final enactment.
new text end

Sec. 5. new text begin DATA PRACTICES.
new text end

new text begin Information submitted by a health plan company under section 3 and data on an individual
who applies for or receives health care premium assistance are private data on individuals
as defined in Minnesota Statutes, section 13.02, subdivision 12. The data may be shared
with the commissioner of revenue for program integrity purposes under section 4, subdivision
2.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day following final enactment.
new text end

ARTICLE 2

REINSURANCE

Section 1.

new text begin [62E.21] DEFINITIONS.
new text end

new text begin Subdivision 1. new text end

new text begin Application. new text end

new text begin Solely for purposes of sections 62E.21 to 62E.24, the terms
and phrases defined in this section have the meanings given them.
new text end

new text begin Subd. 2. new text end

new text begin Affordable Care Act. new text end

new text begin "Affordable Care Act" means the Affordable Care Act
as defined in section 62A.011, subdivision 1a.
new text end

new text begin Subd. 3. new text end

new text begin Attachment point. new text end

new text begin "Attachment point" means the threshold dollar amount for
claims costs incurred by an eligible health carrier for an enrolled individual's covered benefits
in a plan year, after which threshold the claims costs for such benefits are eligible for
Minnesota premium security plan payments.
new text end

new text begin Subd. 4. new text end

new text begin Plan year. new text end

new text begin "Plan year" means a calendar year for which an eligible health carrier
provides coverage under a health plan in the individual market.
new text end

new text begin Subd. 5. new text end

new text begin Board. new text end

new text begin "Board" means the board of directors of the Minnesota Comprehensive
Health Association established under section 62E.10.
new text end

new text begin Subd. 6. new text end

new text begin Coinsurance rate. new text end

new text begin "Coinsurance rate" means the rate, established by the board
of the Minnesota Comprehensive Health Association, at which the association will reimburse
the eligible health carrier for claims costs incurred for an enrolled individual's covered
benefits in a plan year after the attachment point and before the reinsurance cap.
new text end

new text begin Subd. 7. new text end

new text begin Commissioner. new text end

new text begin "Commissioner" means the commissioner of commerce.
new text end

new text begin Subd. 8. new text end

new text begin Contributing member. new text end

new text begin "Contributing member" has the meaning as defined
in section 62E.02, subdivision 23.
new text end

new text begin Subd. 9. new text end

new text begin Eligible health carrier. new text end

new text begin "Eligible health carrier" means:
new text end

new text begin (1) an insurance company licensed under chapter 60A to offer, sell, or issue a policy of
accident and sickness insurance as defined in section 62A.01;
new text end

new text begin (2) a nonprofit health service plan corporation operating under chapter 62C; or
new text end

new text begin (3) a health maintenance organization operating under chapter 62D
new text end

new text begin offering health plans in the individual market and incurring claims costs for an individual
enrollee's covered benefits in the applicable plan year that exceed the attachment point under
the Minnesota premium security plan.
new text end

new text begin Subd. 10. new text end

new text begin Individual market. new text end

new text begin "Individual market" has the meaning as defined in section
62A.011, subdivision 5.
new text end

new text begin Subd. 11. new text end

new text begin Minnesota Comprehensive Health Association or association. new text end

new text begin "Minnesota
Comprehensive Health Association" or "association" has the meaning as defined in section
62E.02, subdivision 14.
new text end

new text begin Subd. 12. new text end

new text begin Minnesota premium security plan. new text end

new text begin The "Minnesota premium security plan"
means the state-based reinsurance program authorized under section 62E.23.
new text end

new text begin Subd. 13. new text end

new text begin Reinsurance cap. new text end

new text begin "Reinsurance cap" means the threshold dollar amount for
claims costs incurred by an eligible health carrier for an enrolled individual's covered
benefits, after which threshold the claims costs for such benefits are no longer eligible for
Minnesota premium security plan payments, established by the board of the Minnesota
Comprehensive Health Association.
new text end

Sec. 2.

new text begin [62E.22] DUTIES OF COMMISSIONER.
new text end

new text begin In the implementation and operation of the Minnesota premium security plan, established
under section 62E.23, the commissioner shall require eligible health carriers to calculate
the premium amount the eligible health carrier would have charged for the applicable plan
year had the Minnesota premium security plan not been established, and submit this
information as part of the rate filing.
new text end

Sec. 3.

new text begin [62E.23] MINNESOTA PREMIUM SECURITY PLAN.
new text end

new text begin Subdivision 1. new text end

new text begin The Minnesota premium security plan as state-based reinsurance.
new text end

new text begin The association is Minnesota's reinsurance entity to administer the state-based reinsurance
program, referred to throughout this chapter as the Minnesota premium security plan. The
Minnesota premium security plan shall be designed to protect consumers by mitigating the
impact of high-risk individuals on rates in the individual market.
new text end

new text begin Subd. 2. new text end

new text begin Minnesota premium security plan parameters. new text end

new text begin (a) The board shall propose
to the commissioner the Minnesota premium security plan payment parameters for the next
plan year by January 15 of the calendar year prior to the applicable plan year. In developing
the proposed payment parameters, the board shall consider the anticipated impact to
premiums. The commissioner shall approve the payment parameters no later than 14 calendar
days following the board proposal. In developing the proposed payment parameters for plan
years 2019 and after, the board may develop methods to account for variations in costs
within the Minnesota premium security plan.
new text end

new text begin (b) For plan year 2018, the Minnesota premium security plan parameters, including the
attachment point, reinsurance cap, and coinsurance rate, shall be established within the
parameters of the appropriated funds as follows:
new text end

new text begin (1) the attachment point is set at $70,000;
new text end

new text begin (2) the reinsurance cap is set at $250,000; and
new text end

new text begin (3) the coinsurance rate is set at 50 percent.
new text end

new text begin (c) All eligible health carriers receiving Minnesota premium security plan payments
must apply the Minnesota premium security plan's parameters established under paragraph
(a) or paragraph (b) of this section, as applicable, when calculating reinsurance payments.
new text end

new text begin Subd. 3. new text end

new text begin Payments under the Minnesota premium security plan. new text end

new text begin (a) Each Minnesota
premium security plan payment must be calculated with respect to an eligible health carrier's
incurred claims costs for an individual enrollee's covered benefits in the applicable plan
year. If such claim costs do not exceed the attachment point, payment will be zero dollars.
If such claim costs exceed the attachment point, payment will be calculated as the product
of the coinsurance rate multiplied by the lesser of:
new text end

new text begin (1) such claims costs minus the attachment point; or
new text end

new text begin (2) the reinsurance cap minus the attachment point.
new text end

new text begin (b) The board must ensure that the payments made to eligible health carriers must not
exceed the eligible health carrier's total paid amount for any eligible claim. For purposes
of this paragraph, total paid amount of an eligible claim means the amount paid by the
eligible health carrier based upon the allowed amount less any deductible, coinsurance, or
co-payment, as of the time the data is submitted or made accessible under subdivision 4,
paragraph (a), clause (1), of this section.
new text end

new text begin Subd. 4. new text end

new text begin Requests for Minnesota premium security plan payments. new text end

new text begin (a) An eligible
health carrier may make a request for payment when the eligible health carrier's claims costs
for an enrollee meet the criteria for payment under subdivision 2 and meet the requirements
of this subdivision.
new text end

new text begin (1) to be eligible for Minnesota premium security plan payments, an eligible health
carrier must provide to the association access to the data within the dedicated data
environment established by the eligible health carrier under the federal Risk Adjustment
Program. Eligible health carriers must submit an attestation to the board asserting entity
compliance with the dedicated data environments, data requirements, establishment and
usage of masked enrollee identification numbers, and data submission deadlines; and
new text end

new text begin (2) an eligible health carrier must provide the required access under clause (1) for the
applicable plan year by April 30 of the year following the end of the applicable plan year.
new text end

new text begin (b) An eligible health carrier must make requests for payment in accordance with the
requirements established by the board.
new text end

new text begin (c) An eligible health carrier must maintain documents and records, whether paper,
electronic, or in other media, sufficient to substantiate the requests for Minnesota premium
security plan payments made pursuant to this section for a period of at least ten years, and
must make those documents and records available upon request from the state or its designee
for purposes of verification, investigation, audit, or other review of Minnesota premium
security plan payment requests.
new text end

new text begin (d) The association or its designee may audit an eligible health carrier to assess its
compliance with the requirements of section 62E.23. The eligible health carrier must ensure
that its relevant contracts, subcontractors, or agents cooperate with any audit under this
section. If an audit results in a proposed finding of material weakness or significant deficiency
with respect to compliance with any requirement under section 62E.23, the eligible health
carrier may provide response to the draft audit report within 30 calendar days. Within 30
calendar days of the issuance of the final audit report, the eligible health carrier must complete
the following:
new text end

new text begin (1) provide a written corrective action plan to the association for approval if the final
audit results in a finding of material weakness or significant deficiency with respect to
compliance with any requirement under section 62E.23;
new text end

new text begin (2) implement that plan; and
new text end

new text begin (3) provide to the association written documentation of the corrective actions once taken.
new text end

new text begin Subd. 5. new text end

new text begin Notification of Minnesota premium security plan payments. new text end

new text begin (a) For each
applicable plan year, the association must notify eligible health carriers annually of Minnesota
premium security plan payments, if applicable, to be made for the applicable plan year no
later than June 30 of the year following the applicable plan year.
new text end

new text begin (b) An eligible health carrier may follow the appeals procedure under section 62E.10,
subdivision 2a.
new text end

new text begin (c) For each applicable plan year, the board must provide to each eligible health carrier
the calculation of total Minnesota premium security plan payment requests on a quarterly
basis during the applicable plan year.
new text end

new text begin Subd. 6. new text end

new text begin Disbursement of Minnesota premium security plan payments. new text end

new text begin The
association must:
new text end

new text begin (1) collect or access data required to determine Minnesota premium security plan
payments from an eligible health carrier according to the data requirements under subdivision
5; and
new text end

new text begin (2) make Minnesota premium security plan payments to the eligible health carrier after
receiving a valid claim for payment from that eligible health carrier by August 15 of the
year following the applicable plan year.
new text end

new text begin Subd. 7. new text end

new text begin Allocation of costs of the Minnesota premium security plan. new text end

new text begin Each contributing
member of the association shall share in the costs of the Minnesota premium security plan,
including security plan payments, and operating and administrative expenses incurred or
estimated to be incurred by the association incident to the plan. Contributing members shall
share in the costs in an amount equal to the ratio of the contributing member's total accident
and health insurance premium, received from or on behalf of Minnesota residents as divided
by the total accident and health insurance premium, received by all contributing members
from or on behalf of Minnesota residents, as determined by the commissioner. Payments
made by the state to a contributing member for medical assistance or MinnesotaCare services
according to chapters 256 and 256B shall be excluded when determining a contributing
member's total premium.
new text end

new text begin Subd. 8. new text end

new text begin Member assessments. new text end

new text begin The association shall make an annual determination of
each contributing member's liability for costs of the Minnesota premium security plan under
subdivision 7, and may make an annual fiscal year-end assessment. The association may
also, subject to the approval of the commissioner, provide for interim assessments against
the contributing members whose aggregate assessments comprised a minimum of 90 percent
of the most recent prior annual assessment, in the event that the association deems that
methodology to be the most administratively efficient and cost-effective means of assessment,
and as may be necessary to assure the financial capability of the association in meeting the
incurred costs of the Minnesota premium security plan and operating and administrative
expenses. Payment of an assessment shall be due within 30 days of receipt by a contributing
member of a written notice of a fiscal year end or interim assessment. A contributing member
that ceases to do accident and health insurance business within the state shall remain liable
for assessments through the calendar year during which accident and health insurance
business ceased.
new text end

new text begin Subd. 9. new text end

new text begin Reserve surplus. new text end

new text begin The association must use any monetary reserves of the
association to offset costs of the Minnesota premium security plan.
new text end

new text begin Subd. 10. new text end

new text begin Data. new text end

new text begin Government data of the association under this section are private data
on individuals or nonpublic data as defined in section 13.02, subdivision 9 or 12.
new text end

Sec. 4.

new text begin [62E.24] ACCOUNTING, REPORTING, AND AUDITING.
new text end

new text begin Subdivision 1. new text end

new text begin Accounting requirements. new text end

new text begin The board must ensure that it keeps an
accounting for each plan year of:
new text end

new text begin (1) all claims for Minnesota premium security plan payments received from eligible
health carriers;
new text end

new text begin (2) all Minnesota premium security plan payments made to eligible health carriers;
new text end

new text begin (3) all administrative expenses incurred for the Minnesota premium security plan; and
new text end

new text begin (4) all assessments made for security plan costs.
new text end

new text begin Subd. 2. new text end

new text begin Summary report. new text end

new text begin The board must submit to the commissioner and make public
a report on the Minnesota premium security plan operations for each plan year by November
1 following the applicable year or 60 calendar days following the last disbursement of
Minnesota premium security plan payments for the applicable plan year.
new text end

new text begin Subd. 3. new text end

new text begin Audits. new text end

new text begin The commissioner or designee may conduct a financial or programmatic
audit of the Minnesota premium security plan to assess its compliance with the requirements.
The board must ensure that it and any relevant contractors, subcontractors, or agents
cooperate with any audit. The Minnesota premium security plan is subject to audit by the
legislative auditor.
new text end

new text begin Subd. 4. new text end

new text begin Independent external audit. new text end

new text begin The board must engage an independent qualified
auditing entity to perform a financial and programmatic audit for each plan year of the
Minnesota premium security plan in accordance with Generally Accepted Auditing Standards
(GAAS). The board must:
new text end

new text begin (1) provide to the commissioner the results of the audit, in the manner and time frame
to be specified by the commissioner;
new text end

new text begin (2) identify to the commissioner any material weakness or significant deficiency identified
in the audit, and address in writing to the commissioner how the board intends to correct
any such material weakness or significant deficiency; and
new text end

new text begin (3) make public a summary of the results of the audit, including any material weakness
or significant deficiency and how the board intends to correct the material weakness or
significant deficiency.
new text end

new text begin Subd. 5. new text end

new text begin Action on audit findings. new text end

new text begin If an audit results in a finding of material weakness
or significant deficiency with respect to compliance with any requirement under this act,
the commissioner of commerce must ensure the board:
new text end

new text begin (1) within 60 calendar days of the issuance of the final audit report, provides a written
corrective action plan to the commissioner for approval;
new text end

new text begin (2) implements that plan; and
new text end

new text begin (3) provides to the commissioner written documentation of the corrective actions once
taken.
new text end

Sec. 5. new text begin STATE INNOVATION WAIVER.
new text end

new text begin Subdivision 1. new text end

new text begin Authority to submit a waiver application. new text end

new text begin The commissioner of
commerce is directed to apply to the United States Secretary of Health and Human Services
under United States Code, title 42, section 18052, for a waiver of applicable provisions of
the Affordable Care Act with respect to health insurance coverage in the state for a plan
year beginning on or after January 1, 2018, for the sole purpose of implementing the
Minnesota premium security plan in a manner that maximizes federal funding for Minnesota.
The Minnesota premium security board shall implement a state plan for meeting the waiver
requirements in a manner consistent with state and federal law, and as approved by the
United States Secretary of Health and Human Services. The commissioner is directed to
apply for a waiver to ensure:
new text end

new text begin (1) eligible Minnesotans receive advance premium tax credits as though the Minnesota
premium security plan did not exist; and
new text end

new text begin (2) federal funding for MinnesotaCare, as Minnesota's basic health program, continues
to be based on the market premium and cost-sharing levels before the impact of reinsurance
under the premium security plan, established under Minnesota Statutes, section 62E.23.
new text end

new text begin Subd. 2. new text end

new text begin Consultation. new text end

new text begin In developing the waiver application, the commissioner shall
consult with the Minnesota Department of Human Services and MNsure.
new text end

new text begin Subd. 3. new text end

new text begin Application deadline. new text end

new text begin The commissioner shall submit the application waiver
to the appropriate federal agency on or before July 5, 2017. The commissioner shall follow
all application instructions. The commissioner shall complete the draft application for public
review and comment by June 1, 2017.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day following final enactment.
new text end

Sec. 6. new text begin EFFECTIVE DATE.
new text end

new text begin This article is effective the day following final enactment.
new text end