1.1                          A bill for an act 
  1.2             relating to insurance; providing an alternative 
  1.3             benefit plan for small employers; authorizing a small 
  1.4             employer alternative benefit plan pilot project; 
  1.5             modifying a definition; regulating expanded provider 
  1.6             networks and point-of-service options of health plan 
  1.7             companies; amending Minnesota Statutes 1998, sections 
  1.8             62L.02, subdivision 16; 62L.05, subdivision 5, and by 
  1.9             adding a subdivision; 62Q.095, subdivision 1; and 
  1.10            62Q.51, subdivision 4. 
  1.11  BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  1.12     Section 1.  Minnesota Statutes 1998, section 62L.02, 
  1.13  subdivision 16, is amended to read: 
  1.14     Subd. 16.  [HEALTH CARRIER.] "Health carrier" means an 
  1.15  insurance company licensed under chapter 60A to offer, sell, or 
  1.16  issue a policy of accident and sickness insurance as defined in 
  1.17  section 62A.01; a health service plan corporation licensed under 
  1.18  chapter 62C; a health maintenance organization licensed under 
  1.19  chapter 62D; a community integrated service network operating 
  1.20  under chapter 62N; an accountable provider network regulated 
  1.21  under chapter 62T; a fraternal benefit society operating under 
  1.22  chapter 64B; a joint self-insurance employee health plan 
  1.23  operating under chapter 62H; a multiple employer welfare 
  1.24  arrangement, as defined in United States Code, title 29, section 
  1.25  1002(40), as amended.  Any use of this definition in another 
  1.26  chapter by reference does not include a community integrated 
  1.27  service network, unless otherwise specified.  For the purpose of 
  1.28  this chapter, companies that are affiliated companies or that 
  2.1   are eligible to file a consolidated tax return must be treated 
  2.2   as one health carrier, except that any insurance company or 
  2.3   health service plan corporation that is an affiliate of a health 
  2.4   maintenance organization located in Minnesota, or any health 
  2.5   maintenance organization located in Minnesota that is an 
  2.6   affiliate of an insurance company or health service plan 
  2.7   corporation, or any health maintenance organization that is an 
  2.8   affiliate of another health maintenance organization in 
  2.9   Minnesota, may treat the health maintenance organization as a 
  2.10  separate health carrier. 
  2.11     Sec. 2.  Minnesota Statutes 1998, section 62L.05, is 
  2.12  amended by adding a subdivision to read: 
  2.13     Subd. 4a.  [ALTERNATIVE BENEFIT PLAN.] In addition to the 
  2.14  small employer benefit plans described in subdivisions 1 to 4, a 
  2.15  health carrier may offer to a small employer a benefit plan that 
  2.16  differs from those plans in the following respects: 
  2.17     (1) the plan may include different copayments and 
  2.18  deductibles; and 
  2.19     (2) the plan may offer coverage on a per diem, fixed 
  2.20  indemnity, or nonexpense incurred basis. 
  2.21     Sec. 3.  Minnesota Statutes 1998, section 62L.05, 
  2.22  subdivision 5, is amended to read: 
  2.23     Subd. 5.  [PLAN VARIATIONS.] (a) No health carrier shall 
  2.24  offer to a small employer a health benefit plan that differs 
  2.25  from the two small employer plans described in subdivisions 1 to 
  2.26  4 4a, unless the health benefit plan complies with all 
  2.27  provisions of chapters 62A, 62C, 62D, 62E, 62H, 62N, and 64B 
  2.28  that otherwise apply to the health carrier, except as expressly 
  2.29  permitted by paragraph (b). 
  2.30     (b) As an exception to paragraph (a), a health benefit plan 
  2.31  is deemed to be a small employer plan and to be in compliance 
  2.32  with paragraph (a) if it differs from one of the two small 
  2.33  employer plans described in subdivisions 1 to 4 only by 
  2.34  providing benefits in addition to those described in subdivision 
  2.35  4, provided that the health benefit plan has an actuarial value 
  2.36  that exceeds the actuarial value of the benefits described in 
  3.1   subdivision 4 by no more than two percent.  "Benefits in 
  3.2   addition" means additional units of a benefit listed in 
  3.3   subdivision 4 or one or more benefits not listed in subdivision 
  3.4   4. 
  3.5      Sec. 4.  Minnesota Statutes 1998, section 62Q.095, 
  3.6   subdivision 1, is amended to read: 
  3.7      Subdivision 1.  [PROVIDER ACCEPTANCE REQUIRED.] Each health 
  3.8   plan company, with the exception of any health plan company with 
  3.9   50,000 or fewer enrollees in its commercial health plan products 
  3.10  and health plan companies that are exempt under subdivision 6, 
  3.11  shall establish an expanded network of allied independent health 
  3.12  providers, in addition to a preferred network.  A health plan 
  3.13  company shall accept as a provider in the expanded network any 
  3.14  allied independent health provider who:  (1) meets the health 
  3.15  plan company's credentialing standards; (2) agrees to the terms 
  3.16  of the health plan company's provider contract; and (3) agrees 
  3.17  to comply with all managed care protocols of the health plan 
  3.18  company.  A preferred network shall be considered an expanded 
  3.19  network if all allied independent health providers who meet the 
  3.20  requirements of clauses (1), (2), and (3) are accepted into the 
  3.21  preferred network.  A community integrated service network may 
  3.22  offer to its enrollees an expanded network of allied independent 
  3.23  health providers as described under this section.  
  3.24     Sec. 5.  Minnesota Statutes 1998, section 62Q.51, 
  3.25  subdivision 4, is amended to read: 
  3.26     Subd. 4.  [EXEMPTION.] This section does not apply to a 
  3.27  health plan company with fewer than 50,000 enrollees in its 
  3.28  commercial health plan products. 
  3.29     Sec. 6.  [SMALL EMPLOYER ALTERNATIVE BENEFIT PLANS; PILOT 
  3.30  PROJECT.] 
  3.31     Notwithstanding any provision of Minnesota Statutes, 
  3.32  chapter 62L, or other law to the contrary, the commissioner of 
  3.33  commerce shall develop a pilot project by January 1, 2000, to 
  3.34  authorize health carriers to offer alternative health benefit 
  3.35  plans to small employers if the following requirements are 
  3.36  satisfied: 
  4.1      (1) the health carrier is assessed less than three percent 
  4.2   of the total amount assessed by the Minnesota comprehensive 
  4.3   health association; 
  4.4      (2) the health benefit plans must be offered in compliance 
  4.5   with Minnesota Statutes, chapter 62L, except as otherwise 
  4.6   permitted in this section; 
  4.7      (3) the health plans to be offered must be designed to 
  4.8   enable employers and covered persons to better manage costs and 
  4.9   coverage options through the use of copays, deductibles, and 
  4.10  other cost-sharing arrangements; 
  4.11     (4) the health plans must meet a 71 percent loss ratio for 
  4.12  small employers with fewer than ten employees, and a 75 percent 
  4.13  loss ratio for all other plans; 
  4.14     (5) the health plans may alter or eliminate coverages that 
  4.15  would otherwise be required by law; and 
  4.16     (6) each health plan must be approved by the commissioner 
  4.17  of commerce. 
  4.18     The definitions in Minnesota Statutes, section 62L.02, 
  4.19  apply to this section as modified by this section. 
  4.20     This section expires August 1, 2003.