HF 14

1st Engrossment - 82nd Legislature (2001 - 2002) Posted on 12/15/2009 12:00am

  1.1                          A bill for an act 
  1.2             relating to health; crediting tobacco settlement 
  1.3             revenues to the health care access fund; eliminating 
  1.4             the MinnesotaCare provider taxes and the premium tax 
  1.5             on nonprofit health plan companies on a contingent 
  1.6             basis; requiring pass-through of savings; amending 
  1.7             Minnesota Statutes 2000, sections 295.52, by adding a 
  1.8             subdivision; 297I.05, subdivision 5; proposing coding 
  1.9             for new law in Minnesota Statutes, chapters 16A; and 
  1.10            62Q; repealing Minnesota Statutes 2000, section 16A.76.
  1.11  BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  1.12     Section 1.  [16A.725] [TOBACCO SETTLEMENT REVENUES.] 
  1.13     Subdivision 1.  [ONE-TIME PAYMENTS.] The commissioner shall 
  1.14  credit to the health care access fund the tobacco settlement 
  1.15  payments received by the state on January 2, 2002, and January 
  1.16  2, 2003, as a result of the settlement of the lawsuit styled as 
  1.17  State v. Philip Morris Inc., No. C1-94-8565 (Minnesota District 
  1.18  Court, Second Judicial District). 
  1.19     Subd. 2.  [ONGOING PAYMENTS.] Beginning with the payment 
  1.20  due December 31, 2001, the commissioner shall credit to the 
  1.21  health care access fund all ongoing payments due December 31 of 
  1.22  each year that are received by the state as a result of the 
  1.23  settlement of the lawsuit styled as State v. Philip Morris Inc., 
  1.24  No. C1-94-8565 (Minnesota District Court, Second Judicial 
  1.25  District). 
  1.26     Sec. 2.  [62Q.48] [PASS-THROUGH OF SAVINGS TO PURCHASERS.] 
  1.27     Subdivision 1.  [PREMIUMS TO REFLECT SAVINGS.] Health plan 
  1.28  company premium rates must reflect all savings resulting from:  
  2.1      (1) the contingent elimination of the MinnesotaCare 
  2.2   provider taxes under section 295.52, subdivision 8, and the 
  2.3   resulting reduction in the transfer of additional expenses 
  2.4   generated by section 295.52 obligations to third party contracts 
  2.5   under section 295.582; and 
  2.6      (2) the contingent elimination of the tax on nonprofit 
  2.7   health plan company premiums under section 297I.05, subdivision 
  2.8   5, paragraph (b). 
  2.9      Subd. 2.  [DOCUMENTING COMPLIANCE.] Each health plan 
  2.10  company shall annually submit documentation indicating 
  2.11  compliance with subdivision 1 to the appropriate commissioner. 
  2.12     Subd. 3.  [ENFORCEMENT.] If the appropriate commissioner 
  2.13  finds that a health plan company has not complied with 
  2.14  subdivision 1, the commissioner may take enforcement action 
  2.15  against that health plan company.  The commissioner may, by 
  2.16  order, require premium rate reductions, fine or censure the 
  2.17  health plan company, or revoke or suspend the certificate of 
  2.18  authority or license of the health plan company to do business 
  2.19  in this state, if the commissioner finds that the health plan 
  2.20  company has not complied with this section.  The health plan 
  2.21  company may appeal the commissioner's order through a contested 
  2.22  case hearing in accordance with chapter 14. 
  2.23     Sec. 3.  Minnesota Statutes 2000, section 295.52, is 
  2.24  amended by adding a subdivision to read: 
  2.25     Subd. 8.  [CONTINGENT ELIMINATION OF TAX.] The commissioner 
  2.26  shall establish tax rates for calendar years beginning on or 
  2.27  after January 1, 2002, based upon determinations made by the 
  2.28  commissioner of finance regarding the balance of the health care 
  2.29  access fund.  The commissioner of finance shall, on September 1 
  2.30  of each year, beginning September 1, 2001, determine the balance 
  2.31  of the health care access fund for the fiscal year that begins 
  2.32  the following July 1.  If the commissioner of finance determines 
  2.33  on September 1 that there is no deficit for the following fiscal 
  2.34  year, no taxes shall be imposed under subdivisions 1, 1a, 2, 3, 
  2.35  and 4, for the calendar year that begins immediately following 
  2.36  that September 1.  If the commissioner of finance determines on 
  3.1   September 1 that there will be a deficit in the fund for the 
  3.2   following fiscal year, then the commissioner, in consultation 
  3.3   with the commissioner of finance, shall determine the amount 
  3.4   needed to eliminate the deficit and shall impose taxes under 
  3.5   subdivisions 1, 1a, 2, 3, and 4 for the calendar year that 
  3.6   begins immediately following that September 1.  The commissioner 
  3.7   shall determine the rate of the tax to the nearest one-quarter 
  3.8   of one percent up to two percent, using the lowest of the rates 
  3.9   that the commissioner determines will produce sufficient revenue 
  3.10  to eliminate the projected deficit.  The commissioner shall 
  3.11  publish in the State Register by October 1 of each year, 
  3.12  beginning October 1, 2001, the amount of the tax to be imposed 
  3.13  for the following calendar year.  In determining the balance of 
  3.14  the health care access fund under this subdivision, the 
  3.15  commissioner of finance shall count revenues resulting from any 
  3.16  increase in the one percent premium tax under section 297I.05, 
  3.17  subdivision 5, paragraph (b). 
  3.18     Sec. 4.  Minnesota Statutes 2000, section 297I.05, 
  3.19  subdivision 5, is amended to read: 
  3.20     Subd. 5.  [HEALTH MAINTENANCE ORGANIZATIONS, NONPROFIT 
  3.21  HEALTH SERVICE PLAN CORPORATIONS, AND COMMUNITY INTEGRATED 
  3.22  SERVICE NETWORKS.] (a) Health maintenance organizations, 
  3.23  community integrated service networks, and nonprofit health care 
  3.24  service plan corporations are exempt from the tax imposed under 
  3.25  this section for premiums received in calendar years 2001 and 
  3.26  2002. 
  3.27     (b) For calendar years after 2002, a contingent tax is 
  3.28  imposed on health maintenance organizations, community 
  3.29  integrated service networks, and nonprofit health care service 
  3.30  plan corporations.  The rate of tax is equal to one percent of 
  3.31  gross premiums less return premiums received in the calendar 
  3.32  year.  The commissioner of finance shall establish premium tax 
  3.33  rates for calendar years beginning on or after January 1, 2003, 
  3.34  based upon determinations made by the commissioner regarding the 
  3.35  balance of the health care access fund.  The commissioner of 
  3.36  finance shall, on September 1 of each year, beginning September 
  4.1   1, 2002, determine the balance of the health care access fund 
  4.2   for the fiscal year that begins the following July 1.  If the 
  4.3   commissioner determines on September 1 that there is no deficit 
  4.4   for the following fiscal year, no tax shall be imposed for the 
  4.5   calendar year that begins immediately following that September 
  4.6   1.  If the commissioner determines on September 1 that there 
  4.7   will be a deficit in the fund for the following fiscal year, 
  4.8   then the commissioner, in consultation with the commissioner of 
  4.9   revenue, shall determine the amount needed to eliminate the 
  4.10  deficit and a tax shall be imposed for the calendar year that 
  4.11  begins immediately following that September 1.  The commissioner 
  4.12  shall determine the rate of the tax as either one-quarter of one 
  4.13  percent, one-half of one percent, three-quarters of one percent, 
  4.14  or one percent of gross premiums, less return premiums received 
  4.15  in the calendar year, whichever is the lowest of those rates 
  4.16  that the commissioner determines will produce sufficient revenue 
  4.17  to eliminate the projected deficit.  The commissioner of finance 
  4.18  shall publish in the State Register by October 1 of each year, 
  4.19  beginning October 1, 2002, the amount of tax to be imposed for 
  4.20  the following calendar year.  In determining the balance of the 
  4.21  health care access fund under this paragraph, the commissioner 
  4.22  of finance shall not count revenues resulting from any increase 
  4.23  in taxes under section 295.52. 
  4.24     (c) In approving the premium rates as required in sections 
  4.25  62L.08, subdivision 8, and 62A.65, subdivision 3, the 
  4.26  commissioners of health and commerce shall ensure that any 
  4.27  exemption from tax as described in paragraph (a) is reflected in 
  4.28  the premium rate. 
  4.29     (d) The commissioner shall deposit all revenues, including 
  4.30  penalties and interest, collected under this chapter from health 
  4.31  maintenance organizations, community integrated service 
  4.32  networks, and nonprofit health service plan corporations in the 
  4.33  health care access fund.  Refunds of overpayments of tax imposed 
  4.34  by this subdivision must be paid from the health care access 
  4.35  fund.  There is annually appropriated from the health care 
  4.36  access fund to the commissioner the amount necessary to make any 
  5.1   refunds of the tax imposed under this subdivision. 
  5.2      Sec. 5.  [REPEALER; FEDERAL RESERVE.] 
  5.3      Minnesota Statutes 2000, section 16A.76, is repealed 
  5.4   effective July 1, 2001.