HF 222

as introduced - 87th Legislature (2011 - 2012) Posted on 01/26/2011 10:45am

A bill for an act
relating to health insurance; requiring guaranteed issue in the individual
market; requiring MCHA to reinsure ceded risk on certain health plans; ending
additional enrollment in MCHA; amending Minnesota Statutes 2010, sections
62A.65, subdivision 2, by adding a subdivision; 62E.10, subdivision 7; 62E.11,
subdivision 1; 62E.14, subdivision 1; repealing Minnesota Statutes 2010, section
62A.65, subdivision 6.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

Section 1.

Minnesota Statutes 2010, section 62A.65, subdivision 2, is amended to read:

Subd. 2.

Guaranteed new text begin issue and new text end renewal.

No individual health plan may be offered,
sold, issued, or renewed to a Minnesota resident unless deleted text begin the health plan provides that the
plan is deleted text end new text begin on a guaranteed issue basis. The health plan must be new text end guaranteed renewable at a
premium rate that does not take into account the claims experience or any change in the
health status of any covered person that occurred after the initial issuance of the health
plan to the person. The premium rate upon renewal must also otherwise comply with this
section. A health carrier must not refuse to renew an individual health plan, except for
nonpayment of premiums, fraud, or misrepresentation.

Sec. 2.

Minnesota Statutes 2010, section 62A.65, is amended by adding a subdivision
to read:

new text begin Subd. 2a. new text end

new text begin Ceding risk to MCHA. new text end

new text begin A health carrier may cede risk to the Minnesota
Comprehensive Health Association with respect to any individual health plan issued by
the carrier under section 62E.10, subdivision 7.
new text end

Sec. 3.

Minnesota Statutes 2010, section 62E.10, subdivision 7, is amended to read:

Subd. 7.

General powers.

The association may:

(a) Exercise the powers granted to insurers under the laws of this state;

(b) Sue or be sued;

(c) Enter into contracts with insurers, similar associations in other states or with
other persons for the performance of administrative functions including the functions
provided for in clauses (e) and (f);

(d) Establish administrative and accounting procedures for the operation of the
association; new text begin and
new text end

(e) Provide for the reinsuring of risks incurred as a result of issuing the coverages
required by deleted text begin sections 62E.04 and 62E.16 deleted text end new text begin law new text end by members of the association. deleted text begin Each member
which elects to reinsure its required risks shall determine the categories of coverage it
elects to reinsure in the association. The categories of coverage are: deleted text end

deleted text begin (1) individual qualified plans, excluding group conversions;
deleted text end

deleted text begin (2) group conversions;
deleted text end

deleted text begin (3) group qualified plans with fewer than 50 employees or members; and
deleted text end

deleted text begin (4) major medical coverage.
deleted text end

deleted text begin A separate election may be made for each category of coverage. If a member elects
to reinsure the risks of a category of coverage, it must reinsure the risk of the coverage
of every life covered under every policy issued in that category. deleted text end A member electing to
reinsure risks of deleted text begin a category of coverage deleted text end new text begin health coverage issued new text end shall enter into a contract
with the association establishing a reinsurance plan for the risks. This contract may
include provision for deleted text begin the deleted text end new text begin rules for ceding of risk, reinsurance thresholds, reinsurance
premiums, and new text end pooling of members' risks reinsured through the association deleted text begin and deleted text end new text begin . new text end It may
provide for assessment of each member reinsuring risks for losses and operating and
administrative expenses incurred, or estimated to be incurred in the operation of the
reinsurance plan. This reinsurance plan shall be approved by the commissioner before it is
effective. Members electing to administer the risks which are reinsured in the association
shall comply with the benefit determination guidelines new text begin , claim processing standards, new text end and
accounting procedures established by the association. The fee charged by the association
for the reinsurance of risks shall not be less than 110 percent of the total anticipated
expenses incurred by the association for the reinsurance deleted text begin ; and deleted text end new text begin .
new text end

deleted text begin (f) Provide for the administration by the association of policies which are reinsured
pursuant to clause (e). Each member electing to reinsure one or more categories of
coverage in the association may elect to have the association administer the categories of
coverage on the member's behalf. If a member elects to have the association administer
the categories of coverage, it must do so for every life covered under every policy issued
in that category. The fee for the administration shall not be less than 110 percent of the
total anticipated expenses incurred by the association for the administration.
deleted text end

Sec. 4.

Minnesota Statutes 2010, section 62E.11, subdivision 1, is amended to read:

Subdivision 1.

Enrollment.

Upon certification as an eligible person in the manner
provided by section 62E.14, an eligible person may enroll in the comprehensive health
insurance plan by payment of the state plan premium to the writing carrier. new text begin Effective
January 1, 2012, no further enrollment may be accepted into the comprehensive health
insurance plan. new text end

Sec. 5.

Minnesota Statutes 2010, section 62E.14, subdivision 1, is amended to read:

Subdivision 1.

Application, contents.

new text begin Subject to section 62E.11, subdivision 1, new text end the
comprehensive health insurance plan shall be open for enrollment by eligible persons.
An eligible person shall enroll by submission of an application to the writing carrier. The
application must provide the following:

(a) name, address, age, list of residences for the immediately preceding six months
and length of time at current residence of the applicant;

(b) name, address, and age of spouse and children if any, if they are to be insured;

(c) evidence of rejection, a requirement of restrictive riders, a rate up, or a
preexisting conditions limitation on a qualified plan, the effect of which is to substantially
reduce coverage from that received by a person considered a standard risk, by at least one
association member within six months of the date of the application, or other eligibility
requirements adopted by rule by the commissioner which are not inconsistent with this
chapter and which evidence that a person is unable to obtain coverage substantially similar
to that which may be obtained by a person who is considered a standard risk;

(d) if the applicant has been terminated from individual health coverage which
does not provide replacement coverage, evidence that no replacement coverage that
meets the requirements of section 62D.121 was offered, and evidence of termination of
individual health coverage by an insurer, nonprofit health service plan corporation, or
health maintenance organization, provided that the contract or policy has been terminated
for reasons other than (1) failure to pay the charge for health care coverage; (2) failure to
make co-payments required by the health care plan; (3) enrollee moving out of the area
served; or (4) a materially false statement or misrepresentation by the enrollee in the
application for the terminated contract or policy; and

(e) a designation of the coverage desired.

An eligible person may not purchase more than one policy from the state plan. Upon
ceasing to be a resident of Minnesota a person is no longer eligible to purchase or renew
coverage under the state plan, except as required by state or federal law with respect to
renewal of Medicare supplement coverage.

Sec. 6. new text begin REPEALER.
new text end

new text begin Minnesota Statutes 2010, section 62A.65, subdivision 6, new text end new text begin is repealed.
new text end

Sec. 7. new text begin EFFECTIVE DATE.
new text end

new text begin Sections 1 to 6 are effective January 1, 2012.
new text end