1.1                          A bill for an act 
  1.2             relating to health; repealing MinnesotaCare premium 
  1.3             and provider taxes, the insurance premium tax on 
  1.4             health insurance, the assessment for the Minnesota 
  1.5             comprehensive health association, and the health 
  1.6             maintenance organization and hospital surcharges; 
  1.7             requiring pass-through of savings to purchasers; 
  1.8             transferring responsibility for losses of the 
  1.9             Minnesota comprehensive health association to the 
  1.10            state treasury; providing for disposition of tobacco 
  1.11            settlement money; providing for contingent repeal of 
  1.12            the health care access fund; providing civil 
  1.13            penalties; amending Minnesota Statutes 2000, sections 
  1.14            62E.11, subdivision 5; 62Q.095, subdivision 6; 214.16, 
  1.15            subdivisions 2 and 3; 256.9657, subdivision 4; 
  1.16            270B.01, subdivision 8; 270B.14, subdivision 1; and 
  1.17            297I.05, subdivision 1; proposing coding for new law 
  1.18            in Minnesota Statutes, chapters 62Q; and 256L; 
  1.19            repealing Minnesota Statutes 2000, sections 13.4967, 
  1.20            subdivision 3; 16A.76; 62E.11, subdivision 6; 62T.09; 
  1.21            62T.10; 144.1484, subdivision 2; 256.9657, 
  1.22            subdivisions 2 and 3; 256L.02, subdivision 3; 295.50; 
  1.23            295.51; 295.52; 295.53; 295.54; 295.55; 295.56; 
  1.24            295.57; 295.58; 295.582; 295.59; and 297I.05, 
  1.25            subdivision 5. 
  1.26  BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  1.27                             ARTICLE 1 
  1.28                REPEAL OF HEALTH CARE-RELATED TAXES; 
  1.29                 USE OF TOBACCO SETTLEMENT PROCEEDS 
  1.30     Section 1.  Minnesota Statutes 2000, section 62E.11, 
  1.31  subdivision 5, is amended to read: 
  1.32     Subd. 5.  [ALLOCATION OF LOSSES.] Each contributing member 
  1.33  of the association shall share the Losses due to claims expenses 
  1.34  of the comprehensive health insurance plan for plans issued or 
  1.35  approved for issuance by the association, and shall share in the 
  2.1   operating and administrative expenses incurred or estimated to 
  2.2   be incurred by the association incident to the conduct of its 
  2.3   affairs must be paid under an appropriation from the state 
  2.4   treasury as provided by law.  Claims expenses of the state plan 
  2.5   which exceed the premium payments allocated to the payment of 
  2.6   benefits shall be the liability of the contributing members.  
  2.7   Contributing members shall share in the claims expense of the 
  2.8   state plan and operating and administrative expenses of the 
  2.9   association in an amount equal to the ratio of the contributing 
  2.10  member's total accident and health insurance premium, received 
  2.11  from or on behalf of Minnesota residents as divided by the total 
  2.12  accident and health insurance premium, received by all 
  2.13  contributing members from or on behalf of Minnesota residents, 
  2.14  as determined by the commissioner.  Payments made by the state 
  2.15  to a contributing member for medical assistance, MinnesotaCare, 
  2.16  or general assistance medical care services according to 
  2.17  chapters 256, 256B, and 256D shall be excluded when determining 
  2.18  a contributing member's total premium. 
  2.19     Sec. 2.  [62Q.752] [PASS-THROUGH OF SAVINGS TO PURCHASERS.] 
  2.20     Subdivision 1.  [REDUCED PREMIUMS.] All health plan 
  2.21  companies shall pass on to purchasers, in the form of reduced 
  2.22  premium rates, all savings resulting from:  
  2.23     (1) the repeal of the MinnesotaCare provider taxes imposed 
  2.24  under Minnesota Statutes 2000, section 295.52, and the resulting 
  2.25  reduction in the transfer of additional expenses generated by 
  2.26  provider tax obligations to third-party contracts under 
  2.27  Minnesota Statutes 2000, section 295.582; 
  2.28     (2) elimination of the health plan premium taxes imposed 
  2.29  under Minnesota Statutes 2000, section 297I.05, subdivisions 1 
  2.30  and 5; 
  2.31     (3) elimination of assessments for losses and operating and 
  2.32  administrative expenses of the Minnesota comprehensive health 
  2.33  association under Minnesota Statutes 2000, section 62E.11, 
  2.34  subdivision 5; 
  2.35     (4) the repeal of the health maintenance organization 
  2.36  surcharge imposed under Minnesota Statutes 2000, section 
  3.1   256.9657, subdivision 3; and 
  3.2      (5) any modification in provider reimbursement rates 
  3.3   resulting from the repeal of the hospital surcharge under 
  3.4   Minnesota Statutes 2000, section 256.9657, subdivision 2. 
  3.5      Subd. 2.  [DOCUMENTING COMPLIANCE.] Each health plan 
  3.6   company shall annually submit documentation indicating 
  3.7   compliance with subdivision 1 to the appropriate commissioner. 
  3.8      Subd. 3.  [ENFORCEMENT.] If the appropriate commissioner 
  3.9   finds that a health plan company has not complied with 
  3.10  subdivision 1, the commissioner may take enforcement action 
  3.11  against the health plan company. 
  3.12     Sec. 3.  Minnesota Statutes 2000, section 256.9657, 
  3.13  subdivision 4, is amended to read: 
  3.14     Subd. 4.  [PAYMENTS INTO THE ACCOUNT.] (a) Payments to the 
  3.15  commissioner under subdivisions subdivision 1 to 3 must be paid 
  3.16  in monthly installments due on the 15th of the month beginning 
  3.17  October 15, 1992.  The monthly payment must be equal to the 
  3.18  annual surcharge divided by 12.  Payments to the commissioner 
  3.19  under subdivisions 2 and 3 for fiscal year 1993 must be based on 
  3.20  calendar year 1990 revenues.  Effective July 1 of each year, 
  3.21  beginning in 1993, payments under subdivisions 2 and 3 must be 
  3.22  based on revenues earned in the second previous calendar year. 
  3.23     (b) Effective October 1, 1995, and each October 1 
  3.24  thereafter, the payments in subdivisions 2 and 3 must be based 
  3.25  on revenues earned in the previous calendar year. 
  3.26     (c) If the commissioner of health does not provide by 
  3.27  August 15 of any year data needed to update the base year for 
  3.28  the hospital and health maintenance organization surcharges, the 
  3.29  commissioner of human services may estimate base year revenue 
  3.30  and use that estimate for the purposes of this section until 
  3.31  actual data is provided by the commissioner of health. 
  3.32     Sec. 4.  [256L.021] [USE OF TOBACCO SETTLEMENT PROCEEDS.] 
  3.33     (a) The commissioner of finance, beginning with the annual 
  3.34  payment due December 31, 2001, shall deposit the annual payments 
  3.35  due under the terms of the tobacco settlement on December 31 of 
  3.36  each year into the health care access fund established under 
  4.1   section 16A.724. 
  4.2      (b) The commissioner of finance shall credit to the health 
  4.3   care access fund the one-time tobacco settlement payments 
  4.4   received by the state on January 2, 2002, and January 2, 2003. 
  4.5      (c) For purposes of this section, "tobacco settlement" 
  4.6   means the consent judgment entered in the case of State v. 
  4.7   Philip Morris Inc., No. C1-94-8565 (Minnesota District Court, 
  4.8   Second Judicial District). 
  4.9      Sec. 5.  [256L.022] [MINNESOTACARE PROGRAM FINANCIAL 
  4.10  MANAGEMENT.] 
  4.11     Subdivision 1.  [FORECASTING FUNDS.] The MinnesotaCare 
  4.12  program is not an entitlement.  The commissioner of human 
  4.13  services shall not expend more funds than the appropriations 
  4.14  made available by the legislature.  Appropriations made 
  4.15  available must include the state-appropriated funds and federal 
  4.16  funds specified for this purpose and other available funds 
  4.17  transferred from other accounts as allowed by Minnesota law.  
  4.18  Regardless of this limitation on expenditures, the total 
  4.19  projected costs of this program must be forecasted and 
  4.20  recognized in the fund balance. 
  4.21     Subd. 2.  [DETERMINATION BY COMMISSIONER.] As part of each 
  4.22  state revenue and expenditure forecast, the commissioner shall 
  4.23  make an assessment of expected MinnesotaCare program 
  4.24  expenditures for the remainder of the current biennium and for 
  4.25  the following biennium.  If the commissioner determines that 
  4.26  projected MinnesotaCare expenditures during a biennium will 
  4.27  exceed the total of:  (1) the funds projected to be available in 
  4.28  the health care access fund; and (2) projected payments from the 
  4.29  tobacco settlement required to be deposited in the health care 
  4.30  access fund under section 256L.021 for that biennium, the 
  4.31  commissioner of human services and the commissioner of finance 
  4.32  shall implement subdivision 1, effective on the first day of the 
  4.33  biennium for which the commissioner of human services makes the 
  4.34  determination. 
  4.35     Subd. 3.  [CONTINGENT APPLICABILITY.] Subdivision 1 is 
  4.36  effective only if the commissioner of human services makes a 
  5.1   determination under subdivision 2 that projected MinnesotaCare 
  5.2   program expenditures will exceed available funding during a 
  5.3   biennium.  If the commissioner makes this determination, 
  5.4   subdivision 1 is effective on the first day of the biennium for 
  5.5   which the commissioner makes the determination. 
  5.6      Sec. 6.  Minnesota Statutes 2000, section 297I.05, 
  5.7   subdivision 1, is amended to read: 
  5.8      Subdivision 1.  [DOMESTIC AND FOREIGN COMPANIES.] Except as 
  5.9   otherwise provided in this section, a tax is imposed on every 
  5.10  domestic and foreign insurance company.  The rate of tax is 
  5.11  equal to two percent of all gross premiums less return premiums 
  5.12  on all direct business received by the insurer or agents of the 
  5.13  insurer in Minnesota, in cash or otherwise, during the year, 
  5.14  except that the tax does not apply to premiums received for 
  5.15  health plans as defined in section 62A.011, subdivision 3, or to 
  5.16  premiums received for coverage described in section 62A.011, 
  5.17  subdivision 3, clauses (6), (7), (9), (10), and (12). 
  5.18     Sec. 7.  [CONTINGENT REPEALER; HEALTH CARE ACCESS FUND.] 
  5.19     Subdivision 1.  [REPEALER.] Minnesota Statutes 2000, 
  5.20  sections 16A.724; 256L.02, subdivision 4; and 295.581, are 
  5.21  repealed effective as provided under subdivision 3. 
  5.22     Subd. 2.  [TRANSFER TO GENERAL FUND.] Upon repeal of the 
  5.23  health care access fund under subdivision 1, the commissioner of 
  5.24  finance shall transfer any funds in the health care access fund 
  5.25  to the general fund and the health care access fund is combined 
  5.26  with and becomes part of the general fund. 
  5.27     Subd. 3.  [CONTINGENT EFFECTIVE DATE.] This section is 
  5.28  effective only if the commissioner of human services makes a 
  5.29  determination under Minnesota Statutes, section 256L.022, that 
  5.30  projected MinnesotaCare program expenditures will exceed 
  5.31  available funding during a biennium.  If the commissioner makes 
  5.32  this determination, this section is effective on the first day 
  5.33  of the biennium for which the commissioner makes the 
  5.34  determination. 
  5.35     Sec. 8.  [REPEALER.] 
  5.36     Subdivision 1.  [FEDERAL RESERVE; FINANCIAL 
  6.1   MANAGEMENT.] Minnesota Statutes 2000, sections 16A.76 and 
  6.2   256L.02, subdivision 3, are repealed effective July 1, 2001. 
  6.3      Subd. 2.  [MINNESOTACARE PROVIDER TAX.] Minnesota Statutes 
  6.4   2000, sections 295.50; 295.51; 295.52; 295.53; 295.54; 295.55; 
  6.5   295.56; 295.57; 295.58; 295.582; and 295.59, are repealed 
  6.6   effective July 1, 2001, for tax periods beginning on or after 
  6.7   that date. 
  6.8      Subd. 3.  [MCHA ASSESSMENT.] Minnesota Statutes 2000, 
  6.9   section 62E.11, subdivision 6, is repealed effective July 1, 
  6.10  2001. 
  6.11     Subd. 4.  [PROVIDER SURCHARGE.] Minnesota Statutes 2000, 
  6.12  section 256.9657, subdivisions 2 and 3, are repealed effective 
  6.13  July 1, 2001. 
  6.14     Subd. 5.  [NONPROFIT HEALTH PLAN COMPANY PREMIUM 
  6.15  TAX.] Minnesota Statutes 2000, section 297I.05, subdivision 5, 
  6.16  is repealed effective July 1, 2001. 
  6.17     Sec. 9.  [EFFECTIVE DATE.] 
  6.18     (a) Section 1 is effective July 1, 2001, and applies to 
  6.19  losses and operating and administrative expenses incurred on or 
  6.20  after that date. 
  6.21     (b) Section 2 is effective July 1, 2001, and applies to 
  6.22  premium rates for health plans issued or renewed on or after 
  6.23  that date. 
  6.24     (c) Section 3 is effective July 1, 2001, and applies to 
  6.25  surcharge payments due on or after that date. 
  6.26     (d) Sections 4, 5, and 8, subdivisions 1 to 4, are 
  6.27  effective July 1, 2001. 
  6.28     (e) Sections 6 and 8, subdivision 5, are effective July 1, 
  6.29  2001, and apply to tax periods beginning on or after that date. 
  6.30                             ARTICLE 2 
  6.31                         CONFORMING CHANGES 
  6.32     Section 1.  Minnesota Statutes 2000, section 62Q.095, 
  6.33  subdivision 6, is amended to read: 
  6.34     Subd. 6.  [EXEMPTION.] A health plan company, to the extent 
  6.35  that it operates as a staff model health plan company as defined 
  6.36  in section 295.50, subdivision 12b, by employing allied 
  7.1   independent health care providers to deliver health care 
  7.2   services to enrollees, is exempt from this section.  For 
  7.3   purposes of this subdivision, "staff model health plan company" 
  7.4   means a health plan company as defined in section 62Q.01, 
  7.5   subdivision 4, that employs one or more types of health care 
  7.6   provider to deliver health care services to the health plan 
  7.7   company's enrollees. 
  7.8      Sec. 2.  Minnesota Statutes 2000, section 214.16, 
  7.9   subdivision 2, is amended to read: 
  7.10     Subd. 2.  [BOARD COOPERATION REQUIRED.] The board shall 
  7.11  assist the commissioner of health in data collection activities 
  7.12  required under Laws 1992, chapter 549, article 7, and shall 
  7.13  assist the commissioner of revenue in activities related to 
  7.14  collection of the health care provider tax required under Laws 
  7.15  1992, chapter 549, article 9.  Upon the request of the 
  7.16  commissioner or the commissioner of revenue, the board shall 
  7.17  make available names and addresses of current licensees and 
  7.18  provide other information or assistance as needed. 
  7.19     Sec. 3.  Minnesota Statutes 2000, section 214.16, 
  7.20  subdivision 3, is amended to read: 
  7.21     Subd. 3.  [GROUNDS FOR DISCIPLINARY ACTION.] The board 
  7.22  shall take disciplinary action, which may include license 
  7.23  revocation, against a regulated person for: 
  7.24     (1) intentional failure to provide the commissioner of 
  7.25  health with the data required under chapter 62J; and 
  7.26     (2) intentional failure to provide the commissioner of 
  7.27  revenue with data on gross revenue and other information 
  7.28  required for the commissioner to implement sections 295.50 to 
  7.29  295.58; 
  7.30     (3) intentional failure to pay the health care provider tax 
  7.31  required under section 295.52; and 
  7.32     (4) entering into a contract or arrangement that is 
  7.33  prohibited under sections 62J.70 to 62J.73. 
  7.34     Sec. 4.  Minnesota Statutes 2000, section 270B.01, 
  7.35  subdivision 8, is amended to read: 
  7.36     Subd. 8.  [MINNESOTA TAX LAWS.] For purposes of this 
  8.1   chapter only, unless expressly stated otherwise, "Minnesota tax 
  8.2   laws" means the taxes, refunds, and fees administered by or paid 
  8.3   to the commissioner under chapters 115B (except taxes imposed 
  8.4   under sections 115B.21 to 115B.24), 289A (except taxes imposed 
  8.5   under sections 298.01, 298.015, and 298.24), 290, 290A, 291, 
  8.6   297A, and 297H and sections 295.50 to 295.59, or any similar 
  8.7   Indian tribal tax administered by the commissioner pursuant to 
  8.8   any tax agreement between the state and the Indian tribal 
  8.9   government, and includes any laws for the assessment, 
  8.10  collection, and enforcement of those taxes, refunds, and fees. 
  8.11     Sec. 5.  Minnesota Statutes 2000, section 270B.14, 
  8.12  subdivision 1, is amended to read: 
  8.13     Subdivision 1.  [DISCLOSURE TO COMMISSIONER OF HUMAN 
  8.14  SERVICES.] (a) On the request of the commissioner of human 
  8.15  services, the commissioner shall disclose return information 
  8.16  regarding taxes imposed by chapter 290, and claims for refunds 
  8.17  under chapter 290A, to the extent provided in paragraph (b) and 
  8.18  for the purposes set forth in paragraph (c). 
  8.19     (b) Data that may be disclosed are limited to data relating 
  8.20  to the identity, whereabouts, employment, income, and property 
  8.21  of a person owing or alleged to be owing an obligation of child 
  8.22  support. 
  8.23     (c) The commissioner of human services may request data 
  8.24  only for the purposes of carrying out the child support 
  8.25  enforcement program and to assist in the location of parents who 
  8.26  have, or appear to have, deserted their children.  Data received 
  8.27  may be used only as set forth in section 256.978. 
  8.28     (d) The commissioner shall provide the records and 
  8.29  information necessary to administer the supplemental housing 
  8.30  allowance to the commissioner of human services.  
  8.31     (e) At the request of the commissioner of human services, 
  8.32  the commissioner of revenue shall electronically match the 
  8.33  social security numbers and names of participants in the 
  8.34  telephone assistance plan operated under sections 237.69 to 
  8.35  237.711, with those of property tax refund filers, and determine 
  8.36  whether each participant's household income is within the 
  9.1   eligibility standards for the telephone assistance plan. 
  9.2      (f) The commissioner may provide records and information 
  9.3   collected under Minnesota Statutes 2000, sections 295.50 to 
  9.4   295.59, to the commissioner of human services for purposes of 
  9.5   the Medicaid Voluntary Contribution and Provider-Specific Tax 
  9.6   Amendments of 1991, Public Law Number 102-234.  Upon the written 
  9.7   agreement by the United States Department of Health and Human 
  9.8   Services to maintain the confidentiality of the data, the 
  9.9   commissioner may provide records and information collected under 
  9.10  Minnesota Statutes 2000, sections 295.50 to 295.59, to the 
  9.11  Health Care Financing Administration section of the United 
  9.12  States Department of Health and Human Services for purposes of 
  9.13  meeting federal reporting requirements.  
  9.14     (g) The commissioner may provide records and information to 
  9.15  the commissioner of human services as necessary to administer 
  9.16  the early refund of refundable tax credits. 
  9.17     (h) The commissioner may disclose information to the 
  9.18  commissioner of human services necessary to verify income for 
  9.19  eligibility and premium payment under the MinnesotaCare program, 
  9.20  under section 256L.05, subdivision 2. 
  9.21     (i) The commissioner may disclose information to the 
  9.22  commissioner of human services necessary to verify whether 
  9.23  applicants or recipients for the Minnesota family investment 
  9.24  program, general assistance, food stamps, and Minnesota 
  9.25  supplemental aid program have claimed refundable tax credits 
  9.26  under chapter 290 and the property tax refund under chapter 
  9.27  290A, and the amounts of the credits. 
  9.28     Sec. 6.  [REPEALER.] 
  9.29     Subdivision 1.  [MINNESOTACARE PROVIDER TAX.] Minnesota 
  9.30  Statutes 2000, sections 13.4967, subdivision 3; and 144.1484, 
  9.31  subdivision 2, are repealed. 
  9.32     Subd. 2.  [PREMIUM TAX ON NONPROFIT HEALTH PLAN COMPANIES.] 
  9.33  Minnesota Statutes 2000, section 62T.10, is repealed. 
  9.34     Subd. 3.  [MCHA ASSESSMENT.] Minnesota Statutes 2000, 
  9.35  section 62T.09, is repealed. 
  9.36     Sec. 7.  [EFFECTIVE DATE.] 
 10.1      Sections 1 to 6 are effective July 1, 2001.