1.1                          A bill for an act 
  1.2             relating to insurance; health plans; prohibiting 
  1.3             provisions that grant the health carrier a subrogation 
  1.4             right, except where the covered person has been fully 
  1.5             compensated from another source; proposing coding for 
  1.6             new law in Minnesota Statutes, chapter 62A. 
  1.7   BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  1.8      Section 1.  [62A.095] [SUBROGATION CLAUSES REGULATED.] 
  1.9      Subdivision 1.  [APPLICABILITY.] No health plan shall be 
  1.10  offered, sold, or issued to a resident of this state, or to 
  1.11  cover a resident of this state, unless the health plan complies 
  1.12  with subdivision 2. 
  1.13     Subd. 2.  [SUBROGATION CLAUSE; LIMITS.] No health plan 
  1.14  described in subdivision 1 shall contain a subrogation, 
  1.15  reimbursement, or similar clause that provides subrogation, 
  1.16  reimbursement, or similar rights to the health carrier issuing 
  1.17  the health plan, unless:  
  1.18     (1) the clause provides that it applies only after the 
  1.19  covered person has received a full recovery from another source; 
  1.20  and 
  1.21     (2) the clause provides that the health carrier's 
  1.22  subrogation right is subject to subtraction for actual monies 
  1.23  paid to account for the pro rata share of the covered person's 
  1.24  costs, disbursements, and reasonable attorney fees, and other 
  1.25  expenses incurred in obtaining the recovery from another source 
  1.26  unless the health carrier is separately represented by an 
  2.1   attorney. 
  2.2      If the health carrier is separately represented by an 
  2.3   attorney, the health carrier and the covered person, by their 
  2.4   attorneys, may enter into an agreement regarding allocation of 
  2.5   the covered person's costs, disbursements, and reasonable 
  2.6   attorney fees and other expenses.  If the health carrier and 
  2.7   covered person cannot reach agreement on allocation, the health 
  2.8   carrier and covered person shall submit the matter to binding 
  2.9   arbitration. 
  2.10     Nothing in this section shall limit a health carrier's 
  2.11  right to recovery from another source which may otherwise exist 
  2.12  at law. 
  2.13     For the purposes of this section, full recovery does not 
  2.14  include payments made by a health plan to or for the benefit of 
  2.15  a covered person. 
  2.16     Subd. 3.  [RETROACTIVE AMENDMENTS REGULATED.] No addition 
  2.17  of, or amendment of, a subrogation, reimbursement, or similar 
  2.18  clause in a health plan shall be applied to the disadvantage of 
  2.19  a covered person with respect to benefits provided by the health 
  2.20  carrier in connection with an injury, illness, condition, or 
  2.21  other covered situation that originated prior to the addition of 
  2.22  or amendment to the clause. 
  2.23     Sec. 2.  [62A.096] [NOTICE OF SUBROGATION CLAIM REQUIRED.] 
  2.24     A person covered by a health carrier who makes a claim 
  2.25  against a collateral source for damages that include repayment 
  2.26  for medical and medically-related expenses incurred for the 
  2.27  covered person's benefit shall provide timely notice, in 
  2.28  writing, to the health carrier of the pending or potential 
  2.29  claim.  Notwithstanding any other law to the contrary, the 
  2.30  statute of limitations applicable to the rights with respect to 
  2.31  reimbursement or subrogation by the health carrier against the 
  2.32  covered person does not commence to run until the notice has 
  2.33  been given. 
  2.34     Sec. 3.  [EFFECTIVE DATE.] 
  2.35     Sections 1 and 2 are effective January 1, 1996, and apply 
  2.36  to plans in effect on that date and plans offered, sold, or 
  3.1   issued on or after that date.