1.1                          A bill for an act 
  1.2             relating to insurance; automobile; regulating medical 
  1.3             benefits; authorizing reparation obligors to offer 
  1.4             benefits through approved managed care plans; 
  1.5             prescribing the powers and duties of the commissioner; 
  1.6             requiring appropriate premium reductions; amending 
  1.7             Minnesota Statutes 1994, section 65B.49, subdivisions 
  1.8             2 and 3a; proposing coding for new law in Minnesota 
  1.9             Statutes, chapter 65B. 
  1.10  BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  1.11     Section 1.  [65B.445] [MANAGED CARE.] 
  1.12     Subdivision 1.  [PERMITTED ARRANGEMENT.] With the prior 
  1.13  approval of the commissioner, a reparation obligor may contract 
  1.14  with one or more entities to provide, through a managed care 
  1.15  plan, the medical benefits required under section 65B.44, 
  1.16  subdivision 2, and section 65B.49, subdivision 3a, to the 
  1.17  reparation obligor's insureds who elect to receive those medical 
  1.18  benefits through the managed care plan.  The contract need not 
  1.19  include coverage for all of the medical benefits required if the 
  1.20  reparation obligor continues to reimburse the insured as 
  1.21  required by law for any required medical benefits not provided 
  1.22  through the managed care plan.  The reparation obligor must also 
  1.23  offer the required medical coverages other than through managed 
  1.24  care. 
  1.25     Subd. 2.  [MANAGED CARE PLAN; DEFINITION.] For purposes of 
  1.26  this section, "managed care plan" means coverage provided by:  
  1.27     (1) a health maintenance organization in compliance with 
  2.1   chapter 62D; 
  2.2      (2) a nonprofit health service plan corporation in 
  2.3   compliance with chapter 62C; 
  2.4      (3) a health carrier as defined in section 62A.011, 
  2.5   subdivision 2, using an arrangement described in section 72A.20, 
  2.6   subdivision 15, clause (4); 
  2.7      (4) a preferred provider organization or network; or 
  2.8      (5) a plan substantially similar to a plan described in 
  2.9   clauses (1) to (4), as determined by the commissioner. 
  2.10     Subd. 3.  [APPLICATION.] A reparation obligor may make 
  2.11  written application to the commissioner for approval of a 
  2.12  contract permitted under subdivision 1.  Approval is valid for 
  2.13  the period the commissioner prescribes unless it is revoked or 
  2.14  suspended.  Application for approval must be made in the form 
  2.15  and manner and must set forth information regarding the proposed 
  2.16  plan for providing services as the commissioner may prescribe.  
  2.17  A contract may be approved to provide services in a limited 
  2.18  geographic area.  The information must include, but not be 
  2.19  limited to: 
  2.20     (1) a list of the names of all health care providers who 
  2.21  will provide services under the managed care plan, together with 
  2.22  appropriate evidence of compliance with any licensing or 
  2.23  certification requirements for those providers to practice in 
  2.24  this state; 
  2.25     (2) a description of the places and manner of providing 
  2.26  services under the plan; and 
  2.27     (3) satisfactory evidence of ability to comply with any 
  2.28  financial requirements the commissioner prescribes to ensure 
  2.29  delivery of service according to the plan.  
  2.30     Subd. 4.  [APPROVAL.] The commissioner shall approve a 
  2.31  contract with a managed care plan if the commissioner finds that 
  2.32  the plan: 
  2.33     (1) proposes to provide quality services, including all 
  2.34  required medical and health care services covered by the 
  2.35  contract in a manner that is timely, effective, and convenient 
  2.36  for the injured person; 
  3.1      (2) is reasonably geographically convenient to the injured 
  3.2   persons it serves; 
  3.3      (3) provides appropriate financial incentives to reduce 
  3.4   service costs and utilization without sacrificing the quality of 
  3.5   service; 
  3.6      (4) provides adequate methods of peer review, utilization 
  3.7   review, and dispute resolution to prevent inappropriate, 
  3.8   excessive, or not medically necessary treatment; 
  3.9      (5) provides a procedure for the resolution of medical 
  3.10  disputes; 
  3.11     (6) provides a timely and accurate method of collecting and 
  3.12  maintaining necessary information regarding medical and health 
  3.13  care service cost and utilization to enable the commissioner to 
  3.14  determine the effectiveness of the plan; 
  3.15     (7) authorizes necessary emergency medical treatment for an 
  3.16  injury provided by a health care provider not a part of the 
  3.17  managed care plan; 
  3.18     (8) does not discriminate against or exclude from 
  3.19  participation in the plan any category of health care provider 
  3.20  and includes an adequate number of each category of health care 
  3.21  providers to give injured persons convenient geographic 
  3.22  accessibility to all categories of providers; 
  3.23     (9) notwithstanding section 62M.02, subdivision 12, clause 
  3.24  (2), managed care contracts approved under this section are 
  3.25  subject to chapter 62M; and 
  3.26     (10) complies with any other requirement the commissioner 
  3.27  determines is necessary to provide quality medical services and 
  3.28  health care to injured persons. 
  3.29     Subd. 5.  [REVOCATION, SUSPENSION, AND REFUSAL TO APPROVE.] 
  3.30  The commissioner shall refuse to approve or shall revoke or 
  3.31  suspend the approval of a contract with a managed care plan if 
  3.32  the commissioner finds that:  (1) the plan for providing medical 
  3.33  or health care services fails to meet the requirements of this 
  3.34  section; or (2) service under the plan is not being provided 
  3.35  according to the terms of an approved plan. 
  3.36     Subd. 6.  [NOTICE; LOCATION.] Prior to an insured's 
  4.1   election of a policy endorsement under this section, the 
  4.2   reparation obligor shall provide to the insured a notice 
  4.3   regarding the precise consequences of electing to obtain medical 
  4.4   expense benefits through approved managed care plans.  The 
  4.5   notice must include the names and exact locations of the managed 
  4.6   care plan's providers.  The reparation obligor shall provide to 
  4.7   the insured an updated list of providers and locations at time 
  4.8   of renewal.  The form and content of the notice must be filed 
  4.9   with and approved by the commissioner prior to its use. 
  4.10     Sec. 2.  Minnesota Statutes 1994, section 65B.49, 
  4.11  subdivision 2, is amended to read: 
  4.12     Subd. 2.  [BASIC ECONOMIC LOSS.] Each plan of reparation 
  4.13  security shall provide for payment of basic economic loss 
  4.14  benefits.  A reparation obligor may make available a policy 
  4.15  endorsement that provides medical benefits under section 65B.44, 
  4.16  subdivision 2, solely through a managed care plan under section 
  4.17  65B.445.  In exchange for electing this policy endorsement, the 
  4.18  insured shall receive an appropriate premium reduction.  If made 
  4.19  available, the insured may elect this policy endorsement at the 
  4.20  time of the policy application or renewal.  Once elected, this 
  4.21  policy endorsement remains effective for as long as the policy 
  4.22  is in effect, or until written revocation of the election by the 
  4.23  insured is received by the reparation obligor.  If the policy 
  4.24  endorsement terminates, an appropriate adjustment in premium 
  4.25  must be made.  A reparation obligor may, at its option, make 
  4.26  this policy endorsement available only to insureds who elect the 
  4.27  similar policy endorsement permitted under subdivision 3a. 
  4.28     Sec. 3.  Minnesota Statutes 1994, section 65B.49, 
  4.29  subdivision 3a, is amended to read: 
  4.30     Subd. 3a.  [UNINSURED AND UNDERINSURED MOTORIST COVERAGES.] 
  4.31  (1) No plan of reparation security may be renewed, delivered or 
  4.32  issued for delivery, or executed in this state with respect to 
  4.33  any motor vehicle registered or principally garaged in this 
  4.34  state unless separate uninsured and underinsured motorist 
  4.35  coverages are provided therein.  Each coverage, at a minimum, 
  4.36  must provide limits of $25,000 because of injury to or the death 
  5.1   of one person in any accident and $50,000 because of injury to 
  5.2   or the death of two or more persons in any accident.  In the 
  5.3   case of injury to, or the death of, two or more persons in any 
  5.4   accident, the amount available to any one person must not exceed 
  5.5   the coverage limit provided for injury to, or the death of, one 
  5.6   person in any accident.  
  5.7      (2) Every owner of a motor vehicle registered or 
  5.8   principally garaged in this state shall maintain uninsured and 
  5.9   underinsured motorist coverages as provided in this subdivision. 
  5.10     (3) No reparation obligor is required to provide limits of 
  5.11  uninsured and underinsured motorist coverages in excess of the 
  5.12  bodily injury liability limit provided by the applicable plan of 
  5.13  reparation security.  
  5.14     (4) No recovery shall be permitted under the uninsured and 
  5.15  underinsured motorist coverages of this section for basic 
  5.16  economic loss benefits paid or payable, or which would be 
  5.17  payable but for any applicable deductible.  
  5.18     (5) If at the time of the accident the injured person is 
  5.19  occupying a motor vehicle, the limit of liability for uninsured 
  5.20  and underinsured motorist coverages available to the injured 
  5.21  person is the limit specified for that motor vehicle.  However, 
  5.22  if the injured person is occupying a motor vehicle of which the 
  5.23  injured person is not an insured, the injured person may be 
  5.24  entitled to excess insurance protection afforded by a policy in 
  5.25  which the injured party is otherwise insured.  The excess 
  5.26  insurance protection is limited to the extent of covered damages 
  5.27  sustained, and further is available only to the extent by which 
  5.28  the limit of liability for like coverage applicable to any one 
  5.29  motor vehicle listed on the automobile insurance policy of which 
  5.30  the injured person is an insured exceeds the limit of liability 
  5.31  of the coverage available to the injured person from the 
  5.32  occupied motor vehicle.  
  5.33     If at the time of the accident the injured person is not 
  5.34  occupying a motor vehicle or motorcycle, the injured person is 
  5.35  entitled to select any one limit of liability for any one 
  5.36  vehicle afforded by a policy under which the injured person is 
  6.1   insured.  
  6.2      (6) Regardless of the number of policies involved, vehicles 
  6.3   involved, persons covered, claims made, vehicles or premiums 
  6.4   shown on the policy, or premiums paid, in no event shall the 
  6.5   limit of liability for uninsured and underinsured motorist 
  6.6   coverages for two or more motor vehicles be added together to 
  6.7   determine the limit of insurance coverage available to an 
  6.8   injured person for any one accident.  
  6.9      (7) The uninsured and underinsured motorist coverages 
  6.10  required by this subdivision do not apply to bodily injury of 
  6.11  the insured while occupying a motor vehicle owned by the 
  6.12  insured, unless the occupied vehicle is an insured motor vehicle.
  6.13     (8) The uninsured and underinsured motorist coverages 
  6.14  required by this subdivision do not apply to bodily injury of 
  6.15  the insured while occupying a motorcycle owned by the insured.  
  6.16     (9) A reparation obligor may make available a policy 
  6.17  endorsement that provides medical benefits required to be 
  6.18  covered under this subdivision solely through a managed care 
  6.19  plan under section 65B.445.  In exchange for electing this 
  6.20  policy endorsement, the insured shall receive an appropriate 
  6.21  premium reduction.  If made available, the insured may elect 
  6.22  this policy endorsement at the time of the policy application or 
  6.23  renewal.  Once elected, this policy endorsement remains in 
  6.24  effect for so long as the policy is in effect, or until written 
  6.25  revocation of the election by the insured is received by the 
  6.26  reparation obligor.  If the policy endorsement terminates, an 
  6.27  appropriate adjustment in premiums must be made.  A reparation 
  6.28  obligor may, at its option, make this policy endorsement 
  6.29  available only to insureds who elect the similar policy 
  6.30  endorsement permitted under subdivision 2. 
  6.31     Sec. 4.  [EFFECTIVE DATE.] 
  6.32     Sections 1 to 3 are effective August 1, 1995.