1.1                          A bill for an act 
  1.2             relating to health; permitting a health maintenance 
  1.3             organization rural demonstration project; amending 
  1.4             Minnesota Statutes 2000, section 62D.30, by adding a 
  1.5             subdivision. 
  1.6   BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  1.7      Section 1.  Minnesota Statutes 2000, section 62D.30, is 
  1.8   amended by adding a subdivision to read: 
  1.9      Subd. 8.  [RURAL DEMONSTRATION PROJECT.] (a) The 
  1.10  commissioner may permit demonstration projects to allow health 
  1.11  maintenance organizations to extend coverage to a health 
  1.12  improvement and purchasing coalition located in rural Minnesota, 
  1.13  comprised of the health maintenance organization and members 
  1.14  from a precise community.  The coalition must be designed in 
  1.15  such a way that members will: 
  1.16     (1) become better informed about health care trends and 
  1.17  cost increases; 
  1.18     (2) be actively engaged in the design of health benefit 
  1.19  options that will meet the needs of their community; 
  1.20     (3) pool their insurance risk; 
  1.21     (4) purchase these products from the health maintenance 
  1.22  organization involved in the demonstration project; and 
  1.23     (5) actively participate in health improvement decisions 
  1.24  for their community. 
  1.25     (b) For purposes of this subdivision, the commissioner must 
  2.1   waive compliance with the following statutes and rules:  the 
  2.2   statutes and rules permitted to be waived under subdivision 1; 
  2.3   the cost-sharing restrictions under section 62D.02, subdivision 
  2.4   8, and Minnesota Rules, part 4685.0801, subparts 1 to 7; 
  2.5   participation in government programs under section 62D.04, 
  2.6   subdivision 5; geographic accessibility under section 62D.124; 
  2.7   conversion rights under sections 62A.148, 62A.17, subdivision 6, 
  2.8   62A.21, subdivision 2b, and 62D.101, subdivision 2; small 
  2.9   employer marketing under section 62L.05, subdivisions 1 to 3; 
  2.10  and small employer geographic premium variations under section 
  2.11  62L.08, subdivision 4.  The commissioner shall approve enrollee 
  2.12  cost-sharing features desired by the coalition that 
  2.13  appropriately share costs between employers, individuals, and 
  2.14  the health maintenance organization.  The health improvement and 
  2.15  purchasing coalition may report to the legislature and the 
  2.16  commissioner after one year from the start date of the project 
  2.17  if the coalition determines that further waivers of existing 
  2.18  laws are necessary for the viability of the demonstration 
  2.19  project. 
  2.20     (c) The health maintenance organization may make the 
  2.21  starting date of the project contingent upon a minimum number of 
  2.22  enrollees as cited in the application, provide for an initial 
  2.23  term of contract with the purchasers of a minimum of three 
  2.24  years, permit a reasonable penalty for employers who withdraw 
  2.25  early from the project, and have reasonable loss ratios 
  2.26  notwithstanding section 62A.021, subdivision 1.  The health 
  2.27  maintenance organization may consider businesses of one to be a 
  2.28  small employer under section 62L.02, subdivision 26.  Health 
  2.29  improvement and purchasing coalitions under this subdivision are 
  2.30  not associations under section 62L.045, subdivision 1, paragraph 
  2.31  (a). 
  2.32     (d) The health improvement and purchasing coalition must 
  2.33  report to the commissioner and the legislature five years from 
  2.34  the starting date of the project to report any significant 
  2.35  findings of the demonstration project. 
  2.36     (e) The commissioner must limit the number of demonstration 
  3.1   projects under this subdivision to five projects. 
  3.2      (f) Approval of the application for the demonstration 
  3.3   project is deemed to be compliance with sections 62D.03, 
  3.4   subdivision 4, clauses (i) and (j); 62D.07, subdivision 2; 
  3.5   62E.03; and 62E.06, subdivisions 1, paragraph (a), 2, and 3. 
  3.6      (g) Subdivisions 2 to 7 apply to demonstration projects 
  3.7   under this subdivision except to the extent that those 
  3.8   subdivisions are inconsistent with this subdivision. 
  3.9      Sec. 2.  [EFFECTIVE DATE.] 
  3.10     Section 1 is effective the day following final enactment.