HF 3809

as introduced - 86th Legislature (2009 - 2010) Posted on 04/26/2010 11:27am

A bill for an act
relating to taxes; increasing the surcharge on managed care plans; increasing
managed care payment rates; amending Minnesota Statutes 2008, sections
256.9657, subdivision 3; 256B.69, by adding a subdivision.

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

Section 1.

Minnesota Statutes 2008, section 256.9657, subdivision 3, is amended to
read:

Subd. 3.

Surcharge on HMOs and community integrated service networks.

(a)
Effective October 1, 1992, each health maintenance organization with a certificate of
authority issued by the commissioner of health under chapter 62D and each community
integrated service network licensed by the commissioner under chapter 62N shall pay to
the commissioner of human services a surcharge equal to six-tenths of one percent of the
total premium revenues of the health maintenance organization or community integrated
service network as reported to the commissioner of health according to the schedule in
subdivision 4.

(b) new text begin Effective June 1, 2010:
new text end

new text begin (1) the surcharge under paragraph (a) is increased to 2.5 percent; and
new text end

new text begin (2) each county-based purchasing plan authorized under section 256B.692 shall pay
to the commissioner a surcharge equal to 2.5 percent of the total premium revenues of
the plan, as reported to the commissioner of health, according to the payment schedule in
subdivision 4.
new text end

new text begin (c) new text end For purposes of this subdivision, total premium revenue means:

(1) premium revenue recognized on a prepaid basis from individuals and groups
for provision of a specified range of health services over a defined period of time which
is normally one month, excluding premiums paid to a health maintenance organization
or community integrated service network from the Federal Employees Health Benefit
Program;

(2) premiums from Medicare wrap-around subscribers for health benefits which
supplement Medicare coverage;

(3) Medicare revenue, as a result of an arrangement between a health maintenance
organization or a community integrated service network and the Centers for Medicare
and Medicaid Services of the federal Department of Health and Human Services, for
services to a Medicare beneficiary, excluding Medicare revenue that states are prohibited
from taxing under sections 1854, 1860D-12, and 1876 of title XVIII of the federal Social
Security Act, codified as United States Code, title 42, sections 1395mm, 1395w-112, and
1395w-24, respectively, as they may be amended from time to time; and

(4) medical assistance revenue, as a result of an arrangement between a health
maintenance organization or community integrated service network and a Medicaid state
agency, for services to a medical assistance beneficiary.

If advance payments are made under clause (1) or (2) to the health maintenance
organization or community integrated service network for more than one reporting period,
the portion of the payment that has not yet been earned must be treated as a liability.

deleted text begin (c) deleted text end new text begin (d) new text end When a health maintenance organization or community integrated service
network merges or consolidates with or is acquired by another health maintenance
organization or community integrated service network, the surviving corporation or the
new corporation shall be responsible for the annual surcharge originally imposed on
each of the entities or corporations subject to the merger, consolidation, or acquisition,
regardless of whether one of the entities or corporations does not retain a certificate of
authority under chapter 62D or a license under chapter 62N.

deleted text begin (d) deleted text end new text begin (e) new text end Effective July 1 of each year, the surviving corporation's or the new
corporation's surcharge shall be based on the revenues earned in the second previous
calendar year by all of the entities or corporations subject to the merger, consolidation,
or acquisition regardless of whether one of the entities or corporations does not retain a
certificate of authority under chapter 62D or a license under chapter 62N until the total
premium revenues of the surviving corporation include the total premium revenues of all
the merged entities as reported to the commissioner of health.

deleted text begin (e) deleted text end new text begin (f) new text end When a health maintenance organization or community integrated service
network, which is subject to liability for the surcharge under this chapter, transfers,
assigns, sells, leases, or disposes of all or substantially all of its property or assets, liability
for the surcharge imposed by this chapter is imposed on the transferee, assignee, or buyer
of the health maintenance organization or community integrated service network.

deleted text begin (f) deleted text end new text begin (g) new text end In the event a health maintenance organization or community integrated
service network converts its licensure to a different type of entity subject to liability
for the surcharge under this chapter, but survives in the same or substantially similar
form, the surviving entity remains liable for the surcharge regardless of whether one of
the entities or corporations does not retain a certificate of authority under chapter 62D
or a license under chapter 62N.

deleted text begin (g) deleted text end new text begin (h) new text end The surcharge assessed to a health maintenance organization or community
integrated service network ends when the entity ceases providing services for premiums
and the cessation is not connected with a merger, consolidation, acquisition, or conversion.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective June 1, 2010.
new text end

Sec. 2.

Minnesota Statutes 2008, section 256B.69, is amended by adding a subdivision
to read:

new text begin Subd. 5k. new text end

new text begin Payment rate modification. new text end

new text begin For services rendered on or after August
1, 2010, the total payment made to managed care and county-based purchasing plans
under the medical assistance program and under MinnesotaCare for families with children
shall be increased by 2.5 percent.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective August 1, 2010.
new text end