1.1 	A bill for an act
1.2 	relating to human services; allowing individuals and small employers to elect 
1.3 	to purchase state health coverage at their own expense; allowing individuals 
1.4 	and small employers to purchase MinnesotaCare coverage at full cost;
1.5 	amending Minnesota Statutes 2004, sections 43A.27, subdivision 2, by adding a 
1.6 	subdivision; 256L.02, by adding a subdivision; 256L.04, subdivisions 1, 7a,  by 
1.7 	adding subdivisions; 256L.05, subdivision 1; 256L.07, subdivision 2; 256L.09, 
1.8 	by adding a subdivision; 256L.15, by adding a subdivision; 256L.17, subdivision 
1.9 	5; Minnesota Statutes 2005 Supplement, sections 256L.05, subdivision 3a; 
1.10 	256L.07, subdivisions 1, 3; 256L.15, subdivision 3; proposing coding for new 
1.11 	law in Minnesota Statutes, chapter 43A.
1.12 	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

1.13 	Section 1. Minnesota Statutes 2004, section 43A.27, subdivision 2, is amended to read:
1.14 		Subd. 2.Elective eligibility. The following persons, if not otherwise covered 
1.15 	by section  43A.24, may elect coverage for themselves or their dependents at their own 
1.16 	expense: 
1.17 	(a) a state employee, including persons on layoff from a civil service position as 
1.18 	provided in collective bargaining agreements or a plan established pursuant to section  
1.19 	43A.18; 
1.20 	(b) an employee of the Board of Regents of the University of Minnesota, including 
1.21 	persons on layoff, as provided in collective bargaining agreements or by the Board of 
1.22 	Regents;
1.23 	(c) an officer or employee of the State Agricultural Society, State Horticultural 
1.24 	Society, Sibley House Association, Minnesota Humanities Commission, Minnesota 
1.25 	Area Industry Labor Management Councils, Minnesota International Center, Minnesota 
1.26 	Academy of Science, Science Museum of Minnesota, Minnesota Safety Council, state 
1.27 	Office of Disabled American Veterans, state Office of the American Legion and its 
2.1 	auxiliary, state Office of Veterans of Foreign Wars and its auxiliary, or state Office of the 
2.2 	Military Order of the Purple Heart;
2.3 	(d) a civilian employee of the adjutant general who is paid from federal funds and 
2.4 	who is not eligible for benefits from any federal civilian employee group life insurance 
2.5 	or health benefits program; and
2.6 	(e) an officer or employee of the State Capitol Credit Union or the Highway Credit 
2.7 	Union.; and
2.8 	(f) a resident of the state of Minnesota who meets the residency requirements 
2.9 	provided by Code of Federal Regulations, title 42, section 435.403, and who has not been 
2.10 	medically treated within three years of application for one or more of the presumptive 
2.11 	conditions sufficient for enrollment in the Minnesota Comprehensive Health Association, 
2.12 	as listed in the operating rule adopted by the association under the authority of Minnesota 
2.13 	Rules, parts 2740.2700, subpart 4, and 2740.3600, subpart 2, item B, except that persons 
2.14 	electing coverage under this clause are eligible only for hospital, medical, and dental 
2.15 	benefits.

2.16 	EFFECTIVE DATE. This section is effective January 1, 2007.

2.17 	Sec. 2. Minnesota Statutes 2004, section 43A.27, is amended by adding a subdivision 
2.18 	to read:
2.19 		Subd. 7.Small employer. (a) A small employer may elect to purchase hospital, 
2.20 	medical, and dental coverage for its employees and dependents if:
2.21 	(1) the employer and employee elect to enroll at their own expense, in the manner and 
2.22 	under the conditions of eligibility the commissioner prescribes and otherwise approves;
2.23 	(2) the small employer has at least 75 percent of its eligible employees who have 
2.24 	not waived coverage participating and contributes at least 50 percent towards the cost of 
2.25 	coverage of each eligible employee; and 
2.26 	(3) the small employer is located in Minnesota.
2.27 	(b) For purposes of this subdivision, "small employer" has the meaning given in 
2.28 	section 62L.02, subdivision 26.

2.29 	EFFECTIVE DATE. This section is effective January 1, 2007.

2.30 	Sec. 3. [43A.275] COORDINATION WITH PRIVATE INSURANCE POLICIES.
2.31 		Subdivision 1.State administered coverage secondary. Plans of hospital, medical, 
2.32 	and dental coverage provided to persons eligible under section 43A.27, subdivision 2, 
2.33 	clause (f), or 7, are secondary to any available private sector health coverage.
3.1 		Subd. 2.Subrogation. (a) Upon providing hospital, medical, or dental benefits 
3.2 	to any person eligible under section 43A.27, subdivision 2, clause (f), or 7, who has 
3.3 	private hospital, medical, or dental coverage, or receives or has a right to receive hospital, 
3.4 	medical, or dental care from any type of organization or entity, or has a cause of action 
3.5 	arising out of an occurrence that necessitated the provision of hospital, medical, or dental 
3.6 	benefits, the state agency or the state agency's agent shall be subrogated, to the extent of 
3.7 	the cost of hospital, medical, or dental care provided, to any rights the person may have 
3.8 	under the terms of the coverage, or against the organization or entity providing or liable to 
3.9 	provide hospital, medical, or dental care, or under the cause of action.
3.10 	(b) The right of subrogation created in this subdivision includes all portions of the 
3.11 	cause of action, notwithstanding any settlement allocation or apportionment that purports 
3.12 	to dispose of portions of the cause of action not subject to subrogation.

3.13 	EFFECTIVE DATE. This section is effective January 1, 2007.

3.14 	Sec. 4. Minnesota Statutes 2004, section 256L.02, is amended by adding a subdivision 
3.15 	to read:
3.16 		Subd. 5.MinnesotaCare coverage as secondary. MinnesotaCare coverage for 
3.17 	persons eligible under section 256L.04, subdivisions 14, 15, and 16, is secondary to any 
3.18 	available private sector health coverage.

3.19 	EFFECTIVE DATE. This section is effective January 1, 2007.

3.20 	Sec. 5. Minnesota Statutes 2004, section 256L.04, subdivision 1, is amended to read:
3.21 		Subdivision 1.Families with children. (a) Families with children with family 
3.22 	income equal to or less than 275 percent of the federal poverty guidelines for the 
3.23 	applicable family size shall be eligible for MinnesotaCare according to this section. All 
3.24 	other provisions of sections  256L.01 to  256L.18, including the insurance-related barriers 
3.25 	to enrollment under section  256L.07, shall apply unless otherwise specified. 
3.26 	(b) Parents who enroll in the MinnesotaCare program must also enroll their children, 
3.27 	if the children are eligible. Children may be enrolled separately without enrollment by 
3.28 	parents. However, if one parent in the household enrolls, both parents must enroll, unless 
3.29 	other insurance is available. If one child from a family is enrolled, all children must 
3.30 	be enrolled, unless other insurance is available. If one spouse in a household enrolls, 
3.31 	the other spouse in the household must also enroll, unless other insurance is available. 
3.32 	Families cannot choose to enroll only certain uninsured members.
4.1 	(c) Beginning October 1, 2003, the dependent sibling definition no longer applies 
4.2 	to the MinnesotaCare program. These persons are no longer counted in the parental 
4.3 	household and may apply as a separate household.
4.4 	(d) Beginning July 1, 2003, or upon federal approval, whichever is later, parents are 
4.5 	not eligible for MinnesotaCare if their gross income exceeds $50,000. Parents eligible 
4.6 	under subdivision 14 are not subject to this paragraph.

4.7 	EFFECTIVE DATE. This section is effective January 1, 2007.

4.8 	Sec. 6. Minnesota Statutes 2004, section 256L.04, subdivision 7a, is amended to read:
4.9 		Subd. 7a.Ineligibility. Applicants whose income is greater than the limits 
4.10 	established under this section may not enroll in the MinnesotaCare program, except as 
4.11 	provided in subdivisions 14, 15, and 16.

4.12 	EFFECTIVE DATE. This section is effective January 1, 2007.

4.13 	Sec. 7. Minnesota Statutes 2004, section 256L.04, is amended by adding a subdivision 
4.14 	to read:
4.15 		Subd. 14.Other families with children. Families with children with family 
4.16 	incomes greater than 275 percent of the federal poverty guidelines for the applicable family 
4.17 	size, or who are not otherwise eligible under subdivision 1, are eligible for MinnesotaCare 
4.18 	coverage under, and subject to all other requirements of, section 256L.03 as if they were 
4.19 	eligible under subdivision 1, if they pay the full cost of the premium.  A family member 
4.20 	who has been medically treated within three years of application for one or more of the 
4.21 	presumptive conditions sufficient for enrollment in the Minnesota Comprehensive Health 
4.22 	Association, as listed in the operating rule adopted by the association under the authority 
4.23 	of Minnesota Rules, parts 2740.2700, subpart 4, and 2740.3600, subpart 2, item B, is not 
4.24 	eligible under this subdivision.

4.25 	EFFECTIVE DATE. This section is effective January 1, 2007.

4.26 	Sec. 8. Minnesota Statutes 2004, section 256L.04, is amended by adding a subdivision 
4.27 	to read:
4.28 		Subd. 15.Other single adults and households with no children. (a) Single adults 
4.29 	and households with no children with household incomes greater than 175 percent of the 
4.30 	federal poverty guidelines for the applicable household size, or who are not otherwise 
4.31 	eligible under subdivision 7, are eligible for MinnesotaCare coverage under, and subject to 
5.1 	all other requirements of, section 256L.03 as if they were eligible under subdivision 7, 
5.2 	if they pay the full cost of the premium.
5.3 	(b) Single adults and households with no children with household incomes greater 
5.4 	than 75 percent of the federal poverty guidelines for the applicable household size who are 
5.5 	eligible for limited benefit coverage under section 256L.035 may elect coverage under 
5.6 	paragraph (a), but must pay the full cost of the premium.
5.7 	(c) An individual who has been medically treated within three years of application 
5.8 	for one or more of the presumptive conditions sufficient for enrollment in the Minnesota 
5.9 	Comprehensive Health Association, as listed in the operating rule adopted by the 
5.10 	association under the authority of Minnesota Rules, parts 2740.2700, subpart 4, and 
5.11 	2740.3600, subpart 2, item B, is not eligible under this subdivision.

5.12 	EFFECTIVE DATE. This section is effective January 1, 2007.

5.13 	Sec. 9. Minnesota Statutes 2004, section 256L.04, is amended by adding a subdivision 
5.14 	to read:
5.15 		Subd. 16.Employees and dependents of small employers. (a) Employees and 
5.16 	dependents of small employers are eligible for MinnesotaCare coverage under, and subject 
5.17 	to all other requirements of, section 256L.03 as if they were eligible under subdivisions 1 
5.18 	or 7, whichever is applicable, if:
5.19 	(1) the small employer and employee pay the full cost of the full premium;
5.20 	(2) the small employer has at least 75 percent of its eligible employees who have 
5.21 	not waived coverage participating and contributes at least 50 percent towards the cost of 
5.22 	coverage of each eligible employee; and
5.23 	(3) the small employer is located in Minnesota.
5.24 	(b) For purposes of this subdivision, "small employer" has the meaning given in 
5.25 	section 62L.02, subdivision 26.

5.26 	EFFECTIVE DATE. This section is effective January 1, 2007.

5.27 	Sec. 10. Minnesota Statutes 2004, section 256L.05, subdivision 1, is amended to read:
5.28 		Subdivision 1.Application and information availability. (a) Applications and 
5.29 	other information must be made available to provider offices, local human services 
5.30 	agencies, school districts, public and private elementary schools in which 25 percent or 
5.31 	more of the students receive free or reduced price lunches, community health offices, and 
5.32 	Women, Infants and Children (WIC) program sites. These sites may accept applications 
5.33 	and forward the forms to the commissioner. Otherwise, applicants may apply directly to 
6.1 	the commissioner. Beginning January 1, 2000, MinnesotaCare enrollment sites will be 
6.2 	expanded to include local county human services agencies which choose to participate.
6.3 	(b) The commissioner shall make applications and other information available to 
6.4 	small employers and organizations representing small employers, and shall work with 
6.5 	these entities to publicize the availability of small employer coverage under section 
6.6 	256L.04, subdivision 16.

6.7 	EFFECTIVE DATE. This section is effective January 1, 2007.

6.8 	Sec. 11. Minnesota Statutes 2005 Supplement, section 256L.05, subdivision 3a, 
6.9 	is amended to read:
6.10 		Subd. 3a.Renewal of eligibility. (a) Beginning January 1, 1999, an enrollee's 
6.11 	eligibility must be renewed every 12 months. The 12-month period begins in the month 
6.12 	after the month the application is approved.
6.13 	(b) Beginning October 1, 2004, an enrollee's eligibility must be renewed every six 
6.14 	months, except that enrollees eligible under section 256L.04, subdivisions 14, 15, and 16, 
6.15 	must renew eligibility every 12 months. The first six-month period of eligibility begins the 
6.16 	month the application is received by the commissioner. The effective date of coverage 
6.17 	within the first six-month period of eligibility is as provided in subdivision 3. Each new 
6.18 	period of eligibility must take into account any changes in circumstances that impact 
6.19 	eligibility and premium amount. An enrollee must provide all the information needed to 
6.20 	redetermine eligibility by the first day of the month that ends the eligibility period. The 
6.21 	premium for the new period of eligibility must be received as provided in section 256L.06
6.22 	in order for eligibility to continue.
6.23 	(c) For single adults and households with no children formerly enrolled in general 
6.24 	assistance medical care and enrolled in MinnesotaCare according to section 256D.03, 
6.25 	subdivision 3, the first six-month period of eligibility begins the month the enrollee 
6.26 	submitted the application or renewal for general assistance medical care.

6.27 	EFFECTIVE DATE. This section is effective January 1, 2007.

6.28 	Sec. 12. Minnesota Statutes 2005 Supplement, section 256L.07, subdivision 1, is 
6.29 	amended to read:
6.30 		Subdivision 1.General requirements. (a) Children enrolled in the original 
6.31 	children's health plan as of September 30, 1992, children who enrolled in the 
6.32 	MinnesotaCare program after September 30, 1992, pursuant to Laws 1992, chapter 549, 
6.33 	article 4, section 17, and children who have family gross incomes that are equal to or 
7.1 	less than 150 percent of the federal poverty guidelines are eligible without meeting 
7.2 	the requirements of subdivision 2 and the four-month requirement in subdivision 3, as 
7.3 	long as they maintain continuous coverage in the MinnesotaCare program or medical 
7.4 	assistance. Children who apply for MinnesotaCare on or after the implementation date 
7.5 	of the employer-subsidized health coverage program as described in Laws 1998, chapter 
7.6 	407, article 5, section 45, who have family gross incomes that are equal to or less than 150 
7.7 	percent of the federal poverty guidelines, must meet the requirements of subdivision 2 to 
7.8 	be eligible for MinnesotaCare.
7.9 	(b) Families enrolled in MinnesotaCare under section 256L.04, subdivision 1, whose 
7.10 	income increases above 275 percent of the federal poverty guidelines, are no longer 
7.11 	eligible for the program and shall be disenrolled by the commissioner. Individuals enrolled 
7.12 	in MinnesotaCare under section 256L.04, subdivision 7, whose income increases above 
7.13 	175 percent of the federal poverty guidelines are no longer eligible for the program and 
7.14 	shall be disenrolled by the commissioner. For persons disenrolled under this subdivision, 
7.15 	MinnesotaCare coverage terminates the last day of the calendar month following the 
7.16 	month in which the commissioner determines that the income of a family or individual 
7.17 	exceeds program income limits.
7.18 	(c) Notwithstanding paragraph (b), children may remain enrolled in MinnesotaCare 
7.19 	if ten percent of their gross individual or gross family income as defined in section 
7.20 	256L.01, subdivision 4, is less than the premium for a six-month policy with a $500 
7.21 	deductible available through the Minnesota Comprehensive Health Association. Children 
7.22 	who are no longer eligible for MinnesotaCare under this clause shall be given a 12-month 
7.23 	notice period from the date that ineligibility is determined before disenrollment. The 
7.24 	premium for children remaining eligible under this clause shall be the maximum premium 
7.25 	determined under section 256L.15, subdivision 2, paragraph (b).
7.26 	(d) Notwithstanding paragraphs (b) and (c), parents eligible under section 256L.04, 
7.27 	subdivision 1, are not eligible for MinnesotaCare if gross household income exceeds 
7.28 	$25,000 for the six-month period of eligibility.

7.29 	EFFECTIVE DATE. This section is effective January 1, 2007.

7.30 	Sec. 13. Minnesota Statutes 2004, section 256L.07, subdivision 2, is amended to read:
7.31 		Subd. 2.Must not have access to employer-subsidized coverage. (a) To be 
7.32 	eligible, a family or individual must not have access to subsidized health coverage through 
7.33 	an employer and must not have had access to employer-subsidized coverage through 
7.34 	a current employer for 18 months prior to application or reapplication. A family or 
8.1 	individual whose employer-subsidized coverage is lost due to an employer terminating 
8.2 	health care coverage as an employee benefit during the previous 18 months is not eligible.
8.3 	(b) This subdivision does not apply to a family or individual who was enrolled 
8.4 	in MinnesotaCare within six months or less of reapplication and who no longer has 
8.5 	employer-subsidized coverage due to the employer terminating health care coverage as 
8.6 	an employee benefit. This subdivision does not apply to persons eligible under section 
8.7 	256L.04, subdivisions 14, 15, and 16.
8.8 	(c) For purposes of this requirement, subsidized health coverage means health 
8.9 	coverage for which the employer pays at least 50 percent of the cost of coverage for 
8.10 	the employee or dependent, or a higher percentage as specified by the commissioner. 
8.11 	Children are eligible for employer-subsidized coverage through either parent, including 
8.12 	the noncustodial parent. The commissioner must treat employer contributions to Internal 
8.13 	Revenue Code Section 125 plans and any other employer benefits intended to pay 
8.14 	health care costs as qualified employer subsidies toward the cost of health coverage for 
8.15 	employees for purposes of this subdivision.

8.16 	EFFECTIVE DATE. This section is effective January 1, 2007.

8.17 	Sec. 14. Minnesota Statutes 2005 Supplement, section 256L.07, subdivision 3, is 
8.18 	amended to read:
8.19 		Subd. 3.Other health coverage. (a) Families and individuals enrolled in the 
8.20 	MinnesotaCare program must have no health coverage while enrolled or for at least four 
8.21 	months prior to application and renewal. Children enrolled in the original children's health 
8.22 	plan and children in families with income equal to or less than 150 percent of the federal 
8.23 	poverty guidelines, who have other health insurance, are eligible if the coverage:
8.24 	(1) lacks two or more of the following:
8.25 	(i) basic hospital insurance;
8.26 	(ii) medical-surgical insurance;
8.27 	(iii) prescription drug coverage;
8.28 	(iv) dental coverage; or
8.29 	(v) vision coverage;
8.30 	(2) requires a deductible of $100 or more per person per year; or
8.31 	(3) lacks coverage because the child has exceeded the maximum coverage for a 
8.32 	particular diagnosis or the policy excludes a particular diagnosis.
8.33 	The commissioner may change this eligibility criterion for sliding scale premiums 
8.34 	in order to remain within the limits of available appropriations. The requirement of no 
8.35 	health coverage does not apply to newborns.
9.1 	(b) Medical assistance, general assistance medical care, and the Civilian Health and 
9.2 	Medical Program of the Uniformed Service, CHAMPUS, or other coverage provided under 
9.3 	United States Code, title 10, subtitle A, part II, chapter 55, are not considered insurance or 
9.4 	health coverage for purposes of the four-month requirement described in this subdivision.
9.5 	(c) For purposes of this subdivision, an applicant or enrollee who is entitled to 
9.6 	Medicare Part A or enrolled in Medicare Part B coverage under title XVIII of the Social 
9.7 	Security Act, United States Code, title 42, sections 1395c to 1395w-152, is considered to 
9.8 	have health coverage. An applicant or enrollee who is entitled to premium-free Medicare 
9.9 	Part A may not refuse to apply for or enroll in Medicare coverage to establish eligibility 
9.10 	for MinnesotaCare.
9.11 	(d) Applicants who were recipients of medical assistance or general assistance 
9.12 	medical care within one month of application must meet the provisions of this subdivision 
9.13 	and subdivision 2.
9.14 	(e) Cost-effective health insurance that was paid for by medical assistance is not 
9.15 	considered health coverage for purposes of the four-month requirement under this 
9.16 	section, except if the insurance continued after medical assistance no longer considered it 
9.17 	cost-effective or after medical assistance closed.
9.18 	(f) This subdivision does not apply to persons eligible under section 256L.04, 
9.19 	subdivisions 14, 15, and 16.

9.20 	EFFECTIVE DATE. This section is effective January 1, 2007.

9.21 	Sec. 15. Minnesota Statutes 2004, section 256L.09, is amended by adding a subdivision 
9.22 	to read:
9.23 		Subd. 8.Exemption from residency requirement for employees of small 
9.24 	employers. Persons eligible under section 256L.04, subdivision 16, are exempt from 
9.25 	this section.

9.26 	EFFECTIVE DATE. This section is effective January 1, 2007.

9.27 	Sec. 16. Minnesota Statutes 2005 Supplement, section 256L.15, subdivision 3, is 
9.28 	amended to read:
9.29 		Subd. 3.Exceptions to sliding scale. Children in families eligible under section 
9.30 	256L.04, subdivision 1, with income at or below 150 percent of the federal poverty 
9.31 	guidelines pay a monthly premium of $4.

9.32 	EFFECTIVE DATE. This section is effective January 1, 2007.

10.1 	Sec. 17. Minnesota Statutes 2004, section 256L.15, is amended by adding a subdivision 
10.2 	to read:
10.3 		Subd. 5.Payment of full cost of premium; administrative costs. (a) Enrollees 
10.4 	eligible under section 256L.04, subdivisions 14, 15, and 16, shall pay the full cost of the 
10.5 	premium. The full premium for families and children is defined as the projected medical 
10.6 	payments for all enrollees eligible under section 256L.04, subdivisions 1 and 14, and all 
10.7 	enrollees who are families and children eligible under section 256L.04, subdivision 16, 
10.8 	divided by the projected monthly average households enrolled for these groups.  The full 
10.9 	cost of the premium for single adults and households without children is defined as the 
10.10 	projected medical payments for all enrollees eligible under section 256L.04, subdivision 
10.11 	7, receiving covered services under section 256L.03; all enrollees eligible under section 
10.12 	256L.04, subdivision 15; and all enrollees who are single adults or households without 
10.13 	children eligible under section 256L.04, subdivision 16, divided by the projected monthly 
10.14 	average household income enrolled for these groups.
10.15 	(b) The commissioner may increase the full cost of the premium calculated under 
10.16 	paragraph (a) to cover any administrative costs incurred by the Department of Human 
10.17 	Services in expanding MinnesotaCare eligibility to include persons eligible under section 
10.18 	256L.04, subdivisions 14, 15, and 16.

10.19 	EFFECTIVE DATE. This section is effective January 1, 2007.

10.20 	Sec. 18. Minnesota Statutes 2004, section 256L.17, subdivision 5, is amended to read:
10.21 		Subd. 5.Exemption. This section does not apply to pregnant women. For purposes 
10.22 	of this subdivision, a woman is considered pregnant for 60 days postpartum. This section 
10.23 	does not apply to persons eligible under section 256L.04, subdivisions 14, 15, and 16.

10.24 	EFFECTIVE DATE. This section is effective January 1, 2007.