1.1                          A bill for an act 
  1.2             relating to health care; prohibiting health plan 
  1.3             companies from denying coverage of a mastectomy 
  1.4             performed on an inpatient hospital basis; clarifying 
  1.5             the status of the comprehensive health association 
  1.6             under medical assistance and general assistance 
  1.7             medical care; opening the process for selecting a 
  1.8             writing carrier; permitting contributing members to 
  1.9             offset assessments against premium taxes; eliminating 
  1.10            the four-month waiting period under MinnesotaCare for 
  1.11            association enrollees; establishing a process for 
  1.12            reviewing proposed state-mandated health plan 
  1.13            benefits; expanding eligibility for the MinnesotaCare 
  1.14            program; authorizing public information projects to 
  1.15            inform uninsured persons about the availability of 
  1.16            health coverage; encouraging health plans to 
  1.17            collaborate with public health agencies; providing 
  1.18            alternative funding for local public health activities 
  1.19            and county social services; strengthening and 
  1.20            enforcing the pass-through provision of the health 
  1.21            care provider tax; reducing duplicative inspections 
  1.22            and regulatory compliance requirements for health plan 
  1.23            companies; appropriating money; amending Minnesota 
  1.24            Statutes 1996, sections 62A.045; 62D.04, by adding a 
  1.25            subdivision; 62E.02, subdivisions 13 and 18; 62E.04, 
  1.26            subdivision 8; 62E.11, by adding subdivisions; 62E.13, 
  1.27            subdivision 2; 62Q.075, subdivision 2; 256.9354, 
  1.28            subdivision 5, and by adding a subdivision; 256.9357, 
  1.29            subdivision 3; 256B.056, subdivision 8; 256B.0625, 
  1.30            subdivision 15; 256D.03, subdivision 3b; 295.58; 
  1.31            295.582; and 297.13, subdivision 1; proposing coding 
  1.32            for new law in Minnesota Statutes, chapters 62A; and 
  1.33            62Q. 
  1.34  BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  1.35                             ARTICLE 1
  1.36           HEALTH CARE CONSUMER PROTECTION AND ASSISTANCE 
  1.37     Section 1.  [62Q.52] [COVERAGE OF INPATIENT MASTECTOMY 
  1.38  REQUIRED.] 
  1.39     (a) A health plan company as defined under section 62Q.01, 
  2.1   subdivision 4, shall not deny coverage of a mastectomy performed 
  2.2   on an inpatient hospital basis, if the mastectomy would 
  2.3   otherwise be covered if performed on an outpatient basis or in 
  2.4   any other health care setting. 
  2.5      (b) Paragraph (a) shall be reviewed under the assessment 
  2.6   process established in section 62A.310.  The commissioner of 
  2.7   health shall submit a written report on the results of the 
  2.8   assessment to the legislature in compliance with section 3.195, 
  2.9   no later than January 1, 1999.  
  2.10     Sec. 2.  [REPORT.] 
  2.11     The commissioner of health, in consultation with affected 
  2.12  state agencies, offices, and ombudsman programs, shall submit a 
  2.13  report to the legislature regarding the feasibility and 
  2.14  desirability of:  consolidating and improving coordination of 
  2.15  some or all existing state consumer assistance activities; and 
  2.16  the establishment of the statewide consumer assistance office to 
  2.17  help consumers locate these services.  The report must include a 
  2.18  budget that does not exceed the combined base level funding of 
  2.19  existing programs. 
  2.20     Sec. 3.  [EFFECTIVE DATE.] 
  2.21     Section 1, paragraph (a), is effective upon completion of 
  2.22  the assessment process required by section 1, paragraph (b). 
  2.23                             ARTICLE 2
  2.24                  AFFORDABILITY OF HEALTH COVERAGE 
  2.25     Section 1.  Minnesota Statutes 1996, section 62A.045, is 
  2.26  amended to read: 
  2.27     62A.045 [PAYMENTS ON BEHALF OF WELFARE RECIPIENTS.] 
  2.28     (a) No health plan issued or renewed to provide coverage to 
  2.29  a Minnesota resident shall contain any provision denying or 
  2.30  reducing benefits because services are rendered to a person who 
  2.31  is eligible for or receiving medical benefits pursuant to title 
  2.32  XIX of the Social Security Act (Medicaid) in this or any other 
  2.33  state; chapter 256; 256B; or 256D or services pursuant to 
  2.34  section 252.27; 256.9351 to 256.9361; 260.251, subdivision 1a; 
  2.35  or 393.07, subdivision 1 or 2.  No health carrier providing 
  2.36  benefits under plans covered by this section shall use 
  3.1   eligibility for medical programs named in this section as an 
  3.2   underwriting guideline or reason for nonacceptance of the risk. 
  3.3      (b) If payment for covered expenses has been made under 
  3.4   state medical programs for health care items or services 
  3.5   provided to an individual, and a third party has a legal 
  3.6   liability to make payments, the rights of payment and appeal of 
  3.7   an adverse coverage decision for the individual, or in the case 
  3.8   of a child their responsible relative or caretaker, will be 
  3.9   subrogated to the state and/or its authorized agent.  
  3.10     (c) Notwithstanding any law to the contrary, when a person 
  3.11  covered by a health plan receives medical benefits according to 
  3.12  any statute listed in this section, payment for covered services 
  3.13  or notice of denial for services billed by the provider must be 
  3.14  issued directly to the provider.  If a person was receiving 
  3.15  medical benefits through the department of human services at the 
  3.16  time a service was provided, the provider must indicate this 
  3.17  benefit coverage on any claim forms submitted by the provider to 
  3.18  the health carrier for those services.  If the commissioner of 
  3.19  human services notifies the health carrier that the commissioner 
  3.20  has made payments to the provider, payment for benefits or 
  3.21  notices of denials issued by the health carrier must be issued 
  3.22  directly to the commissioner.  Submission by the department to 
  3.23  the health carrier of the claim on a department of human 
  3.24  services claim form is proper notice and shall be considered 
  3.25  proof of payment of the claim to the provider and supersedes any 
  3.26  contract requirements of the health carrier relating to the form 
  3.27  of submission.  Liability to the insured for coverage is 
  3.28  satisfied to the extent that payments for those benefits are 
  3.29  made by the health carrier to the provider or the commissioner 
  3.30  as required by this section. 
  3.31     (d) When a state agency has acquired the rights of an 
  3.32  individual eligible for medical programs named in this section 
  3.33  and has health benefits coverage through a health carrier, the 
  3.34  health carrier shall not impose requirements that are different 
  3.35  from requirements applicable to an agent or assignee of any 
  3.36  other individual covered. 
  4.1      (e) For the purpose of this section, health plan includes 
  4.2   coverage offered by integrated service networks, community 
  4.3   integrated service networks, any plan governed under the federal 
  4.4   Employee Retirement Income Security Act of 1974 (ERISA), United 
  4.5   States Code, title 29, sections 1001 to 1461, and coverage 
  4.6   offered under the exclusions listed in section 62A.011, 
  4.7   subdivision 3, clauses (2), (6), (9), (10), and (12).  This 
  4.8   section does not apply to coverage issued by the Minnesota 
  4.9   comprehensive health association under chapter 62E. 
  4.10     Sec. 2.  [62A.310] [ASSESSMENT OF PROPOSED HEALTH COVERAGE 
  4.11  MANDATES.] 
  4.12     Subdivision 1.  [DEFINITIONS.] For purposes of this 
  4.13  section, the following terms have the meanings given:  
  4.14     (1) "mandated health benefit proposal" means a proposal 
  4.15  that would statutorily require a health plan to do the following:
  4.16     (i) provide coverage or increase the amount of coverage for 
  4.17  the treatment of a particular disease, condition, or other 
  4.18  health care need; or 
  4.19     (ii) provide coverage or increase the amount of coverage of 
  4.20  a particular type of health care treatment or service or of 
  4.21  equipment, supplies, or drugs used in connection with a health 
  4.22  care treatment or service. 
  4.23  "Mandated benefit proposal" does not include health benefit 
  4.24  proposals amending the scope of practice of a licensed health 
  4.25  care professional; 
  4.26     (2) "commissioner" means the commissioner of health; and 
  4.27     (3) "health plan" means a health plan as defined in section 
  4.28  62A.011, subdivision 3, but includes coverage listed in clauses 
  4.29  (7) and (10), of that definition.  
  4.30     Subd. 2.  [HEALTH COVERAGE MANDATE ASSESSMENT PROCESS.] The 
  4.31  commissioners of health and commerce, in consultation with the 
  4.32  commissioners of human services and employee relations, shall 
  4.33  establish and administer a process for the review, assessment, 
  4.34  and analysis of mandated health benefit proposals.  The purpose 
  4.35  of the assessment is to provide the legislature with a complete 
  4.36  and timely analysis of all ramifications of any mandated health 
  5.1   benefit proposal.  The assessment must include, in addition to 
  5.2   any other relevant information, the following: 
  5.3      (1) scientific and medical information on the proposed 
  5.4   health benefit, on the potential for harm or benefit to the 
  5.5   patient, and on the comparative benefit or harm from alternative 
  5.6   forms of treatment; and 
  5.7      (2) public health, economic, fiscal, and consumer 
  5.8   information on the impact of the proposed mandate on persons 
  5.9   receiving health services in Minnesota, on the relative cost 
  5.10  effectiveness of the benefit, and on the health care system in 
  5.11  general.  
  5.12     The commissioners of health and commerce shall summarize 
  5.13  the nature and quality of available information in these areas, 
  5.14  and, if possible, shall provide any preliminary information to 
  5.15  the public as part of the public hearing process required in 
  5.16  subdivision 5.  The commissioners may conduct research into 
  5.17  these issues, or may certify existing research as sufficient to 
  5.18  meet the informational needs of the legislature.  
  5.19     Subd. 3.  [REQUESTS FOR ASSESSMENT.] Whenever a legislative 
  5.20  measure containing a mandated health benefit proposal is 
  5.21  introduced as a bill or offered as an amendment to a bill or is 
  5.22  likely to be introduced or offered as an amendment, the chairs 
  5.23  of the standing committees having jurisdiction over the proposal 
  5.24  shall request that the commissioner complete an assessment of 
  5.25  the proposal in order to facilitate any committee action by 
  5.26  either house of the legislature.  Any person or organization may 
  5.27  also request that the commissioner complete an assessment.  If 
  5.28  multiple requests are received, the commissioner shall consult 
  5.29  with the chairs of the standing legislative committees having 
  5.30  jurisdiction over mandated health benefit proposals to 
  5.31  prioritize the requests.  
  5.32     Subd. 4.  [ASSESSMENT OF PROPOSED MANDATES; REPORT TO THE 
  5.33  LEGISLATURE.] The commissioners of health and commerce shall 
  5.34  conduct an assessment of each mandated health benefit proposal 
  5.35  selected for assessment and submit a report to the legislature 
  5.36  no later than 180 days after the request.  The commissioners 
  6.1   shall, in consultation with the chairs of the standing 
  6.2   committees having jurisdiction over the proposal, develop a 
  6.3   reporting date for each proposal to be assessed.  If the 
  6.4   commissioners of health and commerce determine that the 
  6.5   assessment of a particular mandated health benefit proposal 
  6.6   should be completed entirely or in part by one of the two 
  6.7   commissioners, the commissioners may agree to have the 
  6.8   appropriate commissioner complete the assessment and submit the 
  6.9   report to the legislature.  The commissioner responsible for 
  6.10  completing an assessment may seek the assistance and advice of 
  6.11  consultants, contractors, researchers, community leaders, or 
  6.12  other persons or organizations with relevant expertise.  The 
  6.13  commissioner may certify existing research as sufficient to meet 
  6.14  the informational needs of the legislature.  Prior to completion 
  6.15  of an assessment report, the commissioners must gather the 
  6.16  information required under subdivision 2, and must complete the 
  6.17  public hearings required in subdivision 5.  
  6.18     Subd. 5.  [PUBLIC HEARINGS.] The commissioner shall solicit 
  6.19  comments and recommendations on a mandated health benefit 
  6.20  proposal from any interested persons and organizations and shall 
  6.21  schedule one or more public hearings.  The commissioner shall 
  6.22  also seek the comments and recommendations of representatives of 
  6.23  health care consumers and employers.  The commissioner shall 
  6.24  summarize the various comments and recommendations received in 
  6.25  the commissioner's report to the legislature. 
  6.26     Subd. 6.  [ADVICE AND RECOMMENDATIONS.] The commissioner 
  6.27  may appoint an ad hoc advisory panel of providers, consumer 
  6.28  groups, health plan companies, community leaders, economists, 
  6.29  actuaries, and other expert persons to assist the commissioner 
  6.30  in completing a mandate review. 
  6.31     Subd. 7.  [REPORT.] The commissioners shall provide a 
  6.32  summary report of their findings and recommendations to the 
  6.33  relevant committee chairs, to the author of the proposed benefit 
  6.34  mandate, or the entity which requested the assessment. 
  6.35     Sec. 3.  Minnesota Statutes 1996, section 62E.02, 
  6.36  subdivision 13, is amended to read: 
  7.1      Subd. 13.  [ELIGIBLE PERSON.] (a) "Eligible person" means 
  7.2   an individual who: 
  7.3      (1) is currently and has been a resident of Minnesota for 
  7.4   the six months immediately preceding the date of receipt by the 
  7.5   association or its writing carrier of a completed certificate of 
  7.6   eligibility and; 
  7.7      (2) who meets the enrollment requirements of section 
  7.8   62E.14; and 
  7.9      (3) is not otherwise ineligible under this subdivision. 
  7.10     (b) Except as provided in paragraph (c), no individual is 
  7.11  eligible for coverage under a qualified or a Medicare supplement 
  7.12  plan issued by the association for whom a premium, deductible, 
  7.13  coinsurance, or copayment amount is paid or reimbursed by a 
  7.14  federal, state, or local agency as of the first day of any term 
  7.15  for which a premium amount is paid or reimbursed and as of the 
  7.16  day after the last day of any term during which deductible, 
  7.17  coinsurance, or copayment is paid or reimbursed. 
  7.18     (c) Individuals who were both enrolled in medical 
  7.19  assistance under chapter 256B or 256D and covered under a 
  7.20  qualified or Medicare supplement plan issued by the association: 
  7.21  (1) on June 30, 1997; or (2) for whom a premium is not paid or 
  7.22  reimbursed by a federal, state, or local agency, remain eligible 
  7.23  for a fiscal year if the commissioner of finance, upon 
  7.24  consultation with the association, has determined by June 15 of 
  7.25  the preceding fiscal year that the legislature has appropriated 
  7.26  sufficient funds to the association to cover the individuals' 
  7.27  total administrative and claims costs, net of premiums paid, for 
  7.28  the upcoming fiscal year. 
  7.29     Sec. 4.  Minnesota Statutes 1996, section 62E.02, 
  7.30  subdivision 18, is amended to read: 
  7.31     Subd. 18.  [WRITING CARRIER.] "Writing carrier" means the 
  7.32  insurer or insurers, health maintenance organization or 
  7.33  organizations, integrated service network or networks, and 
  7.34  community integrated service network or networks, or other 
  7.35  entity selected by the association and approved by the 
  7.36  commissioner to administer the comprehensive health insurance 
  8.1   plan. 
  8.2      Sec. 5.  Minnesota Statutes 1996, section 62E.04, 
  8.3   subdivision 8, is amended to read: 
  8.4      Subd. 8.  [REDUCTION OF BENEFITS BECAUSE OF OTHER 
  8.5   SERVICES.] No policy of accident and health insurance shall 
  8.6   contain any provision denying or reducing benefits because 
  8.7   services are rendered to an insured or dependent who is eligible 
  8.8   for or receiving benefits pursuant to chapters 256B and 256D, or 
  8.9   sections 252.27; 260.251, subdivision 1a; 393.07, subdivision 1 
  8.10  or 2.  This subdivision does not apply to coverage issued by the 
  8.11  Minnesota comprehensive health association under this chapter. 
  8.12     Sec. 6.  Minnesota Statutes 1996, section 62E.11, is 
  8.13  amended by adding a subdivision to read: 
  8.14     Subd. 8a.  [TAX OFFSET.] Beginning January 1, 1997, an 
  8.15  annual fiscal year-end or interim assessment paid by a 
  8.16  contributing member under this chapter may be offset against the 
  8.17  premium tax payable by that contributing member under section 
  8.18  60A.15 for the year in which the annual fiscal year-end or 
  8.19  interim assessment is paid.  In no event may a contributing 
  8.20  member's total offset in any given year exceed one percent of 
  8.21  its premiums as defined in section 60A.15, subdivision 1, 
  8.22  paragraph (b), for that same year. 
  8.23     Sec. 7.  Minnesota Statutes 1996, section 62E.11, is 
  8.24  amended by adding a subdivision to read: 
  8.25     Subd. 13.  The commissioner shall report to the legislature 
  8.26  annually on the costs incurred by the association in providing 
  8.27  coverage to individuals enrolled in medical assistance under 
  8.28  chapter 256B or 256D.  The report shall be provided to the 
  8.29  chairs of the house committee on health and human services and 
  8.30  the senate committee on health and family security no later than 
  8.31  January 15 of each year.  The report's contents shall be 
  8.32  determined by the commissioner, in consultation with the 
  8.33  department of human services and the association.  At a minimum, 
  8.34  the report shall provide a breakdown of:  (1) the administrative 
  8.35  costs; (2) claims costs; (3) premiums paid; (4) deductibles, 
  8.36  coinsurance, and copayments paid; (5) state payments to 
  9.1   providers satisfying deductibles, coinsurance, or copayments 
  9.2   required to be paid under a qualified or Medicare supplement 
  9.3   plan issued by the association; (6) the number of individuals; 
  9.4   (7) losses; and (8) appropriated state funds; for the 
  9.5   association in aggregate and for each category of individual 
  9.6   enrolled in medical assistance under chapter 256B or 256D.  The 
  9.7   department of human services, the association, and the writing 
  9.8   carrier, shall cooperate with the commissioner and provide any 
  9.9   and all information which the commissioner determines is 
  9.10  necessary to prepare this report. 
  9.11     Sec. 8.  Minnesota Statutes 1996, section 62E.13, 
  9.12  subdivision 2, is amended to read: 
  9.13     Subd. 2.  The association may select policies and 
  9.14  contracts, or parts thereof, submitted by a member or members of 
  9.15  the association, or by the association or others, to develop 
  9.16  specifications for bids from any members entity which wish 
  9.17  wishes to be selected as a writing carrier to administer the 
  9.18  state plan.  The selection of the writing carrier shall be based 
  9.19  upon criteria including established by the board of directors of 
  9.20  the association and approved by the commissioner.  The criteria 
  9.21  shall outline specific qualifications that an entity must 
  9.22  satisfy in order to be selected and, at a minimum, shall include 
  9.23  the member's entity's proven ability to handle large group 
  9.24  accident and health insurance cases, efficient claim paying 
  9.25  capacity, and the estimate of total charges for administering 
  9.26  the plan.  The association may select separate writing carriers 
  9.27  for the two types of qualified plans, the qualified medicare 
  9.28  supplement plan, and the health maintenance organization 
  9.29  contract. 
  9.30     Sec. 9.  Minnesota Statutes 1996, section 256.9357, 
  9.31  subdivision 3, is amended to read: 
  9.32     Subd. 3.  [PERIOD UNINSURED.] To be eligible for subsidized 
  9.33  premium payments based on a sliding scale, families and 
  9.34  individuals initially enrolled in the MinnesotaCare program 
  9.35  under section 256.9354, subdivisions 4 and 5, must have had no 
  9.36  health coverage for at least four months prior to application.  
 10.1   The commissioner may change this eligibility criterion for 
 10.2   sliding scale premiums without complying with rulemaking 
 10.3   requirements in order to remain within the limits of available 
 10.4   appropriations.  The requirement of at least four months of no 
 10.5   health coverage prior to application for the MinnesotaCare 
 10.6   program does not apply to: 
 10.7      (1) families, children, and individuals who want to apply 
 10.8   for the MinnesotaCare program upon termination from the medical 
 10.9   assistance program, general assistance medical care program, or 
 10.10  coverage under a regional demonstration project for the 
 10.11  uninsured funded under section 256B.73, the Hennepin county 
 10.12  assured care program, or the Group Health, Inc., community 
 10.13  health plan; 
 10.14     (2) families and individuals initially enrolled under 
 10.15  section 256.9354, subdivisions 1, paragraph (a), and 2; 
 10.16     (3) children enrolled pursuant to Laws 1992, chapter 549, 
 10.17  article 4, section 17; or 
 10.18     (4) individuals currently serving or who have served in the 
 10.19  military reserves, and dependents of these individuals, if these 
 10.20  individuals:  (i) reapply for MinnesotaCare coverage after a 
 10.21  period of active military service during which they had been 
 10.22  covered by the Civilian Health and Medical Program of the 
 10.23  Uniformed Services (CHAMPUS); (ii) were covered under 
 10.24  MinnesotaCare immediately prior to obtaining coverage under 
 10.25  CHAMPUS; and (iii) have maintained continuous coverage; or 
 10.26     (5) individuals and families whose only health coverage 
 10.27  during the four months prior to application was a qualified or 
 10.28  Medicare supplement plan issued by the Minnesota comprehensive 
 10.29  health association under chapter 62E. 
 10.30     Sec. 10.  Minnesota Statutes 1996, section 256B.056, 
 10.31  subdivision 8, is amended to read: 
 10.32     Subd. 8.  [COOPERATION.] To be eligible for medical 
 10.33  assistance, applicants and recipients must cooperate with the 
 10.34  state and local agency to identify potentially liable 
 10.35  third-party payers and assist the state in obtaining third party 
 10.36  payments, unless good cause for noncooperation is determined 
 11.1   according to Code of Federal Regulations, title 42, part 
 11.2   433.147.  "Cooperation" includes identifying any third party who 
 11.3   may be liable for care and services provided under this chapter 
 11.4   to the applicant, recipient, or any other family member for whom 
 11.5   application is made and providing relevant information to assist 
 11.6   the state in pursuing a potentially liable third party.  
 11.7   Cooperation also includes providing information about a group 
 11.8   health plan for which the person may be eligible and if the plan 
 11.9   is determined cost-effective by the state agency and premiums 
 11.10  are paid by the local agency or there is no cost to the 
 11.11  recipient, they must enroll or remain enrolled with the group.  
 11.12  For purposes of this subdivision, coverage provided by the 
 11.13  Minnesota comprehensive health association under chapter 62E 
 11.14  shall not be considered group health plan coverage or 
 11.15  cost-effective by the state and local agency, nor shall the 
 11.16  association be considered a potentially liable third party by 
 11.17  the state or local agency.  Cost-effective insurance premiums 
 11.18  approved for payment by the state agency and paid by the local 
 11.19  agency are eligible for reimbursement according to section 
 11.20  256B.19. 
 11.21     Sec. 11.  Minnesota Statutes 1996, section 256B.0625, 
 11.22  subdivision 15, is amended to read: 
 11.23     Subd. 15.  [HEALTH PLAN PREMIUMS AND COPAYMENTS.] (a) 
 11.24  Medical assistance covers health care prepayment plan premiums, 
 11.25  insurance premiums, and copayments if determined to be 
 11.26  cost-effective by the commissioner.  For purposes of obtaining 
 11.27  Medicare part A and part B, and copayments, expenditures may be 
 11.28  made even if federal funding is not available. 
 11.29     (b) The state and local agency shall not pay premiums that 
 11.30  a recipient is required to pay under a qualified or Medicare 
 11.31  supplement plan issued by the Minnesota comprehensive health 
 11.32  association. 
 11.33     (c) Paragraph (b) shall not apply in a fiscal year to 
 11.34  recipients covered under a qualified or Medicare supplement plan 
 11.35  issued by the Minnesota comprehensive health association on June 
 11.36  30, 1997, and enrolled in medical assistance on this date, if 
 12.1   the commissioner of finance, upon consultation with the 
 12.2   association, has determined by June 15 of the preceding fiscal 
 12.3   year that the legislature has appropriated sufficient funds to 
 12.4   the association to cover all such recipients' total 
 12.5   administrative and claims costs, net of premiums paid, for the 
 12.6   upcoming fiscal year. 
 12.7      Sec. 12.  Minnesota Statutes 1996, section 256D.03, 
 12.8   subdivision 3b, is amended to read: 
 12.9      Subd. 3b.  [COOPERATION.] (a) General assistance or general 
 12.10  assistance medical care applicants and recipients must cooperate 
 12.11  with the state and local agency to identify potentially liable 
 12.12  third-party payors and assist the state in obtaining third-party 
 12.13  payments.  Cooperation includes identifying any third party who 
 12.14  may be liable for care and services provided under this chapter 
 12.15  to the applicant, recipient, or any other family member for whom 
 12.16  application is made and providing relevant information to assist 
 12.17  the state in pursuing a potentially liable third party.  General 
 12.18  assistance medical care applicants and recipients must cooperate 
 12.19  by providing information about any group health plan in which 
 12.20  they may be eligible to enroll.  They must cooperate with the 
 12.21  state and local agency in determining if the plan is 
 12.22  cost-effective.  For purposes of this subdivision, coverage 
 12.23  provided by the Minnesota comprehensive health association under 
 12.24  chapter 62E shall not be considered group health plan coverage 
 12.25  or cost-effective by the state and local agency, nor shall the 
 12.26  association be considered a potentially liable third party by 
 12.27  the state or local agency.  If the plan is determined 
 12.28  cost-effective and the premium will be paid by the state or 
 12.29  local agency or is available at no cost to the person, they must 
 12.30  enroll or remain enrolled in the group health plan.  
 12.31  Cost-effective insurance premiums approved for payment by the 
 12.32  state agency and paid by the local agency are eligible for 
 12.33  reimbursement according to subdivision 6.  
 12.34     (b) The state and local agency shall not pay premiums that 
 12.35  a recipient is required to pay under a qualified or Medicare 
 12.36  supplement plan issued by the Minnesota comprehensive health 
 13.1   association. 
 13.2      (c) Paragraph (b) shall not apply in a fiscal year to 
 13.3   recipients covered under a qualified or Medicare supplement plan 
 13.4   issued by the Minnesota comprehensive health association on June 
 13.5   30, 1997, and enrolled in medical assistance on this date, if 
 13.6   the commissioner of finance, upon consultation with the 
 13.7   association, has determined by June 15 of the preceding fiscal 
 13.8   year that the legislature has appropriated sufficient funds to 
 13.9   the association to cover all such recipients' total 
 13.10  administrative and claims costs, net of premiums paid, for the 
 13.11  upcoming fiscal year. 
 13.12     Sec. 13.  Minnesota Statutes 1996, section 295.58, is 
 13.13  amended to read: 
 13.14     295.58 [DEPOSIT OF REVENUES AND PAYMENT OF REFUNDS.] 
 13.15     The commissioner shall deposit all revenues, including 
 13.16  penalties and interest, derived from the taxes imposed by 
 13.17  sections 295.50 to 295.57 and from the insurance premiums tax on 
 13.18  health maintenance organizations, community integrated service 
 13.19  networks, integrated service networks, and nonprofit health 
 13.20  service plan corporations and five cents per pack of the tobacco 
 13.21  tax generated under section 297.02 in the health care access 
 13.22  fund in the state treasury.  Refunds of overpayments must be 
 13.23  paid from the health care access fund in the state treasury.  
 13.24  There is annually appropriated from the health care access fund 
 13.25  to the commissioner of revenue the amount necessary to make any 
 13.26  refunds required under section 295.54. 
 13.27     Sec. 14.  Minnesota Statutes 1996, section 297.13, 
 13.28  subdivision 1, is amended to read: 
 13.29     Subdivision 1.  [CIGARETTE TAX APPORTIONMENT.] Revenues 
 13.30  received from taxes, penalties, and interest under sections 
 13.31  297.01 to 297.13 and from license fees and miscellaneous sources 
 13.32  of revenue shall be deposited by the commissioner of revenue in 
 13.33  the state treasury and credited as follows: 
 13.34     (a) first to the general obligation special tax bond debt 
 13.35  service account in each fiscal year the amount required to 
 13.36  increase the balance on hand in the account on each December 1 
 14.1   to an amount equal to the full amount of principal and interest 
 14.2   to come due on all outstanding bonds whose debt service is 
 14.3   payable primarily from the proceeds of the tax to and including 
 14.4   the second following July 1; and 
 14.5      (b) after the requirements of paragraph (a) have been met: 
 14.6      (1) the revenue produced by one mill of the tax on 
 14.7   cigarettes weighing not more than three pounds a thousand and 
 14.8   two mills of the tax on cigarettes weighing more than three 
 14.9   pounds a thousand must be credited to the Minnesota future 
 14.10  resources fund; 
 14.11     (2) the revenue produced by 2.5 mills of the tax on 
 14.12  cigarettes weighing not more than three pounds a thousand must 
 14.13  be credited to the health care access fund in the state 
 14.14  treasury; and 
 14.15     (3) the balance of the revenues derived from taxes, 
 14.16  penalties, and interest under sections 297.01 to 297.13 and from 
 14.17  license fees and miscellaneous sources of revenue shall be 
 14.18  credited to the general fund. 
 14.19     Sec. 15.  [STUDY.] 
 14.20     The commissioners of health, commerce, and revenue shall 
 14.21  jointly submit a written report to the legislature that includes 
 14.22  options and recommendations for alternative funding methods to 
 14.23  replace existing financing mechanisms, including provider taxes 
 14.24  and health plan premium taxes.  The recommendations must include 
 14.25  a dedicated fund that preserves adequate funding for uninsured 
 14.26  persons served by the MinnesotaCare program.  The report must be 
 14.27  submitted to the legislature by January 1, 1998, in compliance 
 14.28  with Minnesota Statutes, section 3.195. 
 14.29     Sec. 16.  [APPROPRIATION.] 
 14.30     $....... is appropriated in fiscal year 1998 and $....... 
 14.31  is appropriated in fiscal year 1999 from the general fund to the 
 14.32  board of directors of the Minnesota comprehensive health 
 14.33  association to cover the total administrative and claims costs, 
 14.34  net of premiums paid, associated with those individuals who are 
 14.35  covered by a qualified or Medicare supplement plan issued by the 
 14.36  association and who are enrolled in medical assistance under 
 15.1   Minnesota Statutes, chapter 256B or 256D.  
 15.2      Sec. 17.  [EFFECTIVE DATE.] 
 15.3      Sections 1 and 4 to 12 are effective the day following 
 15.4   final enactment. 
 15.5                              ARTICLE 3
 15.6                 IMPROVING ACCESS TO HEALTH COVERAGE 
 15.7      Section 1.  Minnesota Statutes 1996, section 256.9354, 
 15.8   subdivision 5, is amended to read: 
 15.9      Subd. 5.  [ADDITION OF SINGLE ADULTS AND HOUSEHOLDS WITH NO 
 15.10  CHILDREN.] (a) Beginning October 1, 1994, the definition of 
 15.11  "eligible persons" is expanded to include all individuals and 
 15.12  households with no children who have gross family incomes that 
 15.13  are equal to or less than 125 percent of the federal poverty 
 15.14  guidelines and who are not eligible for medical assistance 
 15.15  without a spenddown under chapter 256B.  
 15.16     (b) After October 1, 1995, the commissioner of human 
 15.17  services may expand the definition of "eligible persons" to 
 15.18  include all individuals and households with no children who have 
 15.19  gross family incomes that are equal to or less than 135 percent 
 15.20  of federal poverty guidelines and are not eligible for medical 
 15.21  assistance without a spenddown under chapter 256B.  This 
 15.22  expansion may occur only if the financial management 
 15.23  requirements of section 256.9352, subdivision 3, can be met. 
 15.24     (c) The commissioners of health and human services, in 
 15.25  consultation with the legislative commission on health care 
 15.26  access, shall make preliminary recommendations to the 
 15.27  legislature by October 1, 1995, and final recommendations to the 
 15.28  legislature by February 1, 1996, on whether a further expansion 
 15.29  of the definition of "eligible persons" to include all 
 15.30  individuals and households with no children who have gross 
 15.31  family incomes that are equal to or less than 150 percent of 
 15.32  federal poverty guidelines and are not eligible for medical 
 15.33  assistance without a spenddown under chapter 256B would be 
 15.34  allowed under the financial management constraints outlined in 
 15.35  section 256.9352, subdivision 3. 
 15.36     (d) Beginning October 1, 1997, the definition of eligible 
 16.1   persons is expanded to include all individuals and households 
 16.2   with no children who have gross family incomes that are equal to 
 16.3   or less than 175 percent of the federal poverty guidelines and 
 16.4   who are not eligible for medical assistance without a spenddown 
 16.5   under chapter 256B. 
 16.6      (c) All eligible persons under paragraphs (a) and (b) are 
 16.7   eligible for coverage through the MinnesotaCare program but must 
 16.8   pay a premium as determined under sections 256.9357 and 
 16.9   256.9358.  Individuals and families whose income is greater than 
 16.10  the limits established under section 256.9358 may not enroll in 
 16.11  the MinnesotaCare program. 
 16.12     Sec. 2.  Minnesota Statutes 1996, section 256.9354, is 
 16.13  amended by adding a subdivision to read: 
 16.14     Subd. 8.  [MINNESOTACARE OUTREACH.] The commissioner of 
 16.15  human services shall, within the limits of available 
 16.16  appropriations and financial resources, engage in activities to 
 16.17  inform uninsured persons of the importance of maintaining 
 16.18  insurance coverage and provide information on the various 
 16.19  options for obtaining coverage, including the MinnesotaCare 
 16.20  health plan and other state health care programs, Minnesota 
 16.21  comprehensive health association coverage, and private health 
 16.22  coverage options.  The commissioner may accept grants or 
 16.23  contributions from individuals and organizations to support 
 16.24  public information activities and may undertake joint public 
 16.25  information projects with other public or private organizations. 
 16.26     Sec. 3.  [APPROPRIATION.] 
 16.27     $....... is appropriated from the general fund to the 
 16.28  commissioner of human services for public information projects 
 16.29  to inform uninsured persons about their options for obtaining 
 16.30  health coverage.  The appropriation is available until spent. 
 16.31                             ARTICLE 4
 16.32                    COMMUNITY HEALTH IMPROVEMENT 
 16.33     Section 1.  Minnesota Statutes 1996, section 62Q.075, 
 16.34  subdivision 2, is amended to read: 
 16.35     Subd. 2.  [REQUIREMENT.] (a) Beginning October 31, 1997, 
 16.36  all managed care organizations shall file biennially with the 
 17.1   action plans required under section 62Q.07 a plan describing the 
 17.2   actions the managed care organization has taken and those it 
 17.3   intends to take to contribute to achieving public health goals 
 17.4   for each service area in which an enrollee of the managed care 
 17.5   organization resides.  This plan must be jointly developed in 
 17.6   collaboration with the local public health units, appropriate 
 17.7   regional coordinating boards, and other community organizations 
 17.8   providing health services within the same service area as the 
 17.9   managed care organization.  Local government units with 
 17.10  responsibilities and authority defined under chapters 145A and 
 17.11  256E may designate individuals to participate in the 
 17.12  collaborative planning with the managed care organization to 
 17.13  provide expertise and represent community needs and goals as 
 17.14  identified under chapters 145A and 256E. 
 17.15     (b) Local public health agencies may ask managed care 
 17.16  organizations that are not required to collaborate to 
 17.17  collaborate voluntarily.  A managed care organization that is 
 17.18  not required to comply with this section may voluntarily file a 
 17.19  collaboration plan describing the actions the managed care 
 17.20  organization has taken and those it intends to take to 
 17.21  contribute to achieving public health goals. 
 17.22     Sec. 2.  [APPROPRIATION FOR LOCAL PUBLIC HEALTH AND SOCIAL 
 17.23  SERVICE ACTIVITIES.] 
 17.24     $....... is appropriated from the general fund to the 
 17.25  commissioner of health to provide grants to all community health 
 17.26  services boards to support core public health functions.  The 
 17.27  grants shall be made to ensure adequate base level funding to 
 17.28  support core public health activities and to fund public health 
 17.29  activities and services.  The appropriation is available until 
 17.30  spent. 
 17.31                             ARTICLE 5
 17.32                       HEALTH CARE PROVIDERS 
 17.33     Section 1.  Minnesota Statutes 1996, section 295.582, is 
 17.34  amended to read: 
 17.35     295.582 [AUTHORITY.] 
 17.36     (a) A hospital, surgical center, pharmacy, or health care 
 18.1   provider that is subject to a tax under section 295.52, or a 
 18.2   pharmacy that has paid additional expense transferred under this 
 18.3   section by a wholesale drug distributor, may transfer additional 
 18.4   expense generated by section 295.52 obligations on to all 
 18.5   third-party contracts for the purchase of health care services 
 18.6   on behalf of a patient or consumer.  The additional expense 
 18.7   transferred to the third-party purchaser must not exceed two 
 18.8   percent of the gross revenues received under the third-party 
 18.9   contract, and two percent of copayments and deductibles paid by 
 18.10  the individual patient or consumer.  The expense must not be 
 18.11  generated on revenues derived from payments that are excluded 
 18.12  from the tax under section 295.53.  All third-party purchasers 
 18.13  of health care services including, but not limited to, 
 18.14  third-party purchasers regulated under chapter 60A, 62A, 62C, 
 18.15  62D, 62H, 62N, 64B, 65A, 65B, 79, or 79A, or under section 
 18.16  471.61 or 471.617, must pay the transferred expense in addition 
 18.17  to any payments due under existing contracts with the hospital, 
 18.18  surgical center, pharmacy, or health care provider, to the 
 18.19  extent allowed under federal law.  A third-party purchaser of 
 18.20  health care services includes, but is not limited to, a health 
 18.21  carrier, integrated service network, or community integrated 
 18.22  service network that pays for health care services on behalf of 
 18.23  patients or that reimburses, indemnifies, compensates, or 
 18.24  otherwise insures patients for health care services.  A 
 18.25  third-party purchaser shall comply with this section regardless 
 18.26  of whether the third-party purchaser is a for-profit, 
 18.27  not-for-profit, or nonprofit entity.  A wholesale drug 
 18.28  distributor may transfer additional expense generated by section 
 18.29  295.52 obligations to entities that purchase from the 
 18.30  wholesaler, and the entities must pay the additional expense.  
 18.31  Nothing in this section limits the ability of a hospital, 
 18.32  surgical center, pharmacy, wholesale drug distributor, or health 
 18.33  care provider to recover all or part of the section 295.52 
 18.34  obligation by other methods, including increasing fees or 
 18.35  charges. 
 18.36     (b) Each third-party purchaser regulated under any chapter 
 19.1   cited in paragraph (a) shall include with its annual renewal for 
 19.2   certification of authority or licensure documentation indicating 
 19.3   compliance with paragraph (a).  If the commissioner responsible 
 19.4   for regulating the third-party purchaser finds at any time that 
 19.5   the third-party purchaser has not complied with paragraph (a), 
 19.6   the commissioner may by order fine or censure the third-party 
 19.7   purchaser or revoke or suspend the certificate of authority or 
 19.8   license of the third-party purchaser to do business in this 
 19.9   state.  The third-party purchaser may appeal the commissioner's 
 19.10  order through a contested case hearing in accordance with 
 19.11  chapter 14. 
 19.12     (c) The commissioners of health and commerce are authorized 
 19.13  to enforce the pass-through as provided in this section for 
 19.14  those health plan companies they regulate.  A hospital, surgical 
 19.15  center, pharmacy, or health care provider that is subject to a 
 19.16  tax under section 295.52 may file a complaint with the 
 19.17  commissioner responsible for regulating the third-party 
 19.18  purchaser if at any time the third-party purchaser does not 
 19.19  comply with paragraph (a).  The commissioners of health and 
 19.20  commerce may take enforcement action against a regulated health 
 19.21  plan company which is subject to their regulatory jurisdiction 
 19.22  and which does not allow a provider to pass through the tax.  
 19.23  The commissioners of health and commerce may fine or censure a 
 19.24  health plan company, or revoke or suspend the certificate of 
 19.25  authority or license of the health plan company to do business 
 19.26  in this state, if the commissioner finds that the health plan 
 19.27  company has not complied with this section. 
 19.28                             ARTICLE 6
 19.29                       HEALTH PLAN REGULATION 
 19.30     Section 1.  Minnesota Statutes 1996, section 62D.04, is 
 19.31  amended by adding a subdivision to read: 
 19.32     Subd. 6.  [DUPLICATIVE INSPECTIONS AND REGULATORY 
 19.33  REQUIREMENTS.] (a) Beginning July 1, 1997, the commissioner of 
 19.34  health shall treat accreditation of a health maintenance 
 19.35  organization or community integrated service network by a 
 19.36  national accreditation organization to be satisfactory evidence 
 20.1   of compliance with and fulfillment of any state statutory or 
 20.2   regulatory requirements established under this chapter that are 
 20.3   substantially the same as or similar to requirements that are 
 20.4   established and verified by a national accreditation 
 20.5   organization or that relate to a general topic or factor that is 
 20.6   the subject of national accreditation standards.  The 
 20.7   commissioner shall coordinate state regulatory compliance 
 20.8   activities, inspections, and reporting requirements with 
 20.9   national accreditation activities in order to reduce the 
 20.10  administrative costs and burdens incurred by health maintenance 
 20.11  organizations, community integrated service networks, and 
 20.12  nonprofit health service plan corporations to comply with 
 20.13  multiple, duplicative inspections, reports, and compliance 
 20.14  requirements imposed by various regulatory agencies and 
 20.15  accreditation organizations. 
 20.16     (b) For purposes of this subdivision, "national 
 20.17  accreditation organization" includes the joint commission on the 
 20.18  accreditation of health care organizations, the national 
 20.19  committee on quality assurance, and the utilization review and 
 20.20  accreditation commission.