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Minnesota Legislature

Office of the Revisor of Statutes

HF 673

3rd Engrossment - 83rd Legislature (2003 - 2004) Posted on 12/15/2009 12:00am

KEY: stricken = removed, old language.
underscored = added, new language.

Current Version - 3rd Engrossment

  1.1                          A bill for an act 
  1.2             relating to insurance; changing certain loss ratio 
  1.3             standards; permitting the comprehensive health 
  1.4             association to offer policies with higher annual 
  1.5             deductibles; permitting extension of the writing 
  1.6             carrier contract; providing a new category of 
  1.7             individuals eligible for coverage; clarifying the 
  1.8             effective date of coverage and other matters; amending 
  1.9             Minnesota Statutes 2002, sections 62A.021, subdivision 
  1.10            1; 62E.08, subdivision 1; 62E.091; 62E.12; 62E.13, 
  1.11            subdivision 2, by adding a subdivision; 62E.14; 62E.18.
  1.12  BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  1.13     Section 1.  Minnesota Statutes 2002, section 62A.021, 
  1.14  subdivision 1, is amended to read: 
  1.15     Subdivision 1.  [LOSS RATIO STANDARDS.] (a) Notwithstanding 
  1.16  section 62A.02, subdivision 3, relating to loss ratios, health 
  1.17  care policies or certificates shall not be delivered or issued 
  1.18  for delivery to an individual or to a small employer as defined 
  1.19  in section 62L.02, unless the policies or certificates can be 
  1.20  expected, as estimated for the entire period for which rates are 
  1.21  computed to provide coverage, to return to Minnesota 
  1.22  policyholders and certificate holders in the form of aggregate 
  1.23  benefits not including anticipated refunds or credits, provided 
  1.24  under the policies or certificates, (1) at least 75 percent of 
  1.25  the aggregate amount of premiums earned in the case of policies 
  1.26  issued in the small employer market, as defined in section 
  1.27  62L.02, subdivision 27, calculated on an aggregate basis; and 
  1.28  (2) at least 65 percent of the aggregate amount of premiums 
  2.1   earned in the case of each policy form or certificate form 
  2.2   issued in the individual market; calculated on the basis of 
  2.3   incurred claims experience or incurred health care expenses 
  2.4   where coverage is provided by a health maintenance organization 
  2.5   on a service rather than reimbursement basis and earned premiums 
  2.6   for the period and according to accepted actuarial principles 
  2.7   and practices.  Assessments by the reinsurance association 
  2.8   created in chapter 62L and all types of taxes, surcharges, or 
  2.9   assessments created by Laws 1992, chapter 549, or created on or 
  2.10  after April 23, 1992, are included in the calculation of 
  2.11  incurred claims experience or incurred health care expenses.  
  2.12  The applicable percentage for policies and certificates issued 
  2.13  in the small employer market, as defined in section 62L.02, 
  2.14  increases by one percentage point on July 1 of each year, 
  2.15  beginning on July 1, 1994, until an 82 percent loss ratio is 
  2.16  reached on July 1, 2000.  The applicable percentage for policy 
  2.17  forms and certificate forms issued in the individual market 
  2.18  increases by one percentage point on July 1 of each year, 
  2.19  beginning on July 1, 1994, until a 72 percent loss ratio is 
  2.20  reached on July 1, 2000.  A health carrier that enters a market 
  2.21  after July 1, 1993, does not start at the beginning of the 
  2.22  phase-in schedule and must instead comply with the loss ratio 
  2.23  requirements applicable to other health carriers in that market 
  2.24  for each time period.  Premiums earned and claims incurred in 
  2.25  markets other than the small employer and individual markets are 
  2.26  not relevant for purposes of this section. 
  2.27     (b) All filings of rates and rating schedules shall 
  2.28  demonstrate that actual expected claims in relation to premiums 
  2.29  comply with the requirements of this section when combined with 
  2.30  actual experience to date.  Filings of rate revisions shall also 
  2.31  demonstrate that the anticipated loss ratio over the entire 
  2.32  future period for which the revised rates are computed to 
  2.33  provide coverage can be expected to meet the appropriate loss 
  2.34  ratio standards, and aggregate loss ratio from inception of the 
  2.35  policy form or certificate form shall equal or exceed the 
  2.36  appropriate loss ratio standards. 
  3.1      (c) A health carrier that issues health care policies and 
  3.2   certificates to individuals or to small employers, as defined in 
  3.3   section 62L.02, in this state shall file annually its rates, 
  3.4   rating schedule, and supporting documentation including ratios 
  3.5   of incurred losses to earned premiums by policy form or 
  3.6   certificate form duration for approval by the commissioner 
  3.7   according to the filing requirements and procedures prescribed 
  3.8   by the commissioner.  The supporting documentation shall also 
  3.9   demonstrate in accordance with actuarial standards of practice 
  3.10  using reasonable assumptions that the appropriate loss ratio 
  3.11  standards can be expected to be met over the entire period for 
  3.12  which rates are computed.  The demonstration shall exclude 
  3.13  active life reserves.  If the data submitted does not confirm 
  3.14  that the health carrier has satisfied the loss ratio 
  3.15  requirements of this section, the commissioner shall notify the 
  3.16  health carrier in writing of the deficiency.  The health carrier 
  3.17  shall have 30 days from the date of the commissioner's notice to 
  3.18  file amended rates that comply with this section.  If the health 
  3.19  carrier fails to file amended rates within the prescribed time, 
  3.20  the commissioner shall order that the health carrier's filed 
  3.21  rates for the nonconforming policy form or certificate form be 
  3.22  reduced to an amount that would have resulted in a loss ratio 
  3.23  that complied with this section had it been in effect for the 
  3.24  reporting period of the supplement.  The health carrier's 
  3.25  failure to file amended rates within the specified time or the 
  3.26  issuance of the commissioner's order amending the rates does not 
  3.27  preclude the health carrier from filing an amendment of its 
  3.28  rates at a later time.  The commissioner shall annually make the 
  3.29  submitted data available to the public at a cost not to exceed 
  3.30  the cost of copying.  The data must be compiled in a form useful 
  3.31  for consumers who wish to compare premium charges and loss 
  3.32  ratios. 
  3.33     (d) Each sale of a policy or certificate that does not 
  3.34  comply with the loss ratio requirements of this section is an 
  3.35  unfair or deceptive act or practice in the business of insurance 
  3.36  and is subject to the penalties in sections 72A.17 to 72A.32. 
  4.1      (e)(1) For purposes of this section, health care policies 
  4.2   issued as a result of solicitations of individuals through the 
  4.3   mail or mass media advertising, including both print and 
  4.4   broadcast advertising, shall be treated as individual policies. 
  4.5      (2) For purposes of this section, (i) "health care policy" 
  4.6   or "health care certificate" is a health plan as defined in 
  4.7   section 62A.011; and (ii) "health carrier" has the meaning given 
  4.8   in section 62A.011 and includes all health carriers delivering 
  4.9   or issuing for delivery health care policies or certificates in 
  4.10  this state or offering these policies or certificates to 
  4.11  residents of this state.  
  4.12     (f) The loss ratio phase-in as described in paragraph (a) 
  4.13  does not apply to individual policies and small employer 
  4.14  policies issued by a health plan company that is assessed less 
  4.15  than three percent of the total annual amount assessed by the 
  4.16  Minnesota comprehensive health association.  These policies must 
  4.17  meet a 68 percent loss ratio for individual policies, a 71 
  4.18  percent loss ratio for small employer policies with fewer than 
  4.19  ten employees, and a 75 percent loss ratio for all other small 
  4.20  employer policies.  
  4.21     (g) Notwithstanding paragraphs (a) and (f), the loss ratio 
  4.22  shall be 60 percent for a policy or certificate of accident and 
  4.23  sickness insurance as defined in section 62A.01 health plan as 
  4.24  defined in section 62A.011, offered by an insurance company 
  4.25  licensed under chapter 60A that is assessed less than ten 
  4.26  percent of the total annual amount assessed by the Minnesota 
  4.27  Comprehensive Health Association.  For purposes of the 
  4.28  percentage calculation of the association's assessments, an 
  4.29  insurance company's assessments include those of its affiliates. 
  4.30     (h) The commissioners of commerce and health shall each 
  4.31  annually issue a public report listing, by health plan company, 
  4.32  the actual loss ratios experienced in the individual and small 
  4.33  employer markets in this state by the health plan companies that 
  4.34  the commissioners respectively regulate.  The commissioners 
  4.35  shall coordinate release of these reports so as to release them 
  4.36  as a joint report or as separate reports issued the same day.  
  5.1   The report or reports shall be released no later than June 1 for 
  5.2   loss ratios experienced for the preceding calendar year.  Health 
  5.3   plan companies shall provide to the commissioners any 
  5.4   information requested by the commissioners for purposes of this 
  5.5   paragraph. 
  5.6      Sec. 2.  Minnesota Statutes 2002, section 62E.08, 
  5.7   subdivision 1, is amended to read: 
  5.8      Subdivision 1.  [ESTABLISHMENT.] The association shall 
  5.9   establish the following maximum premiums to be charged for 
  5.10  membership in the comprehensive health insurance plan: 
  5.11     (a) the premium for the number one qualified plan shall 
  5.12  range from a minimum of 101 percent to a maximum of 125 percent 
  5.13  of the weighted average of rates charged by those insurers and 
  5.14  health maintenance organizations with individuals enrolled in: 
  5.15     (1) $1,000 annual deductible individual plans of insurance 
  5.16  in force in Minnesota; 
  5.17     (2) individual health maintenance organization contracts of 
  5.18  coverage with a $1,000 annual deductible which are in force in 
  5.19  Minnesota; and 
  5.20     (3) other plans of coverage similar to plans offered by the 
  5.21  association based on generally accepted actuarial principles; 
  5.22     (b) the premium for the number two qualified plan shall 
  5.23  range from a minimum of 101 percent to a maximum of 125 percent 
  5.24  of the weighted average of rates charged by those insurers and 
  5.25  health maintenance organizations with individuals enrolled in: 
  5.26     (1) $500 annual deductible individual plans of insurance in 
  5.27  force in Minnesota; 
  5.28     (2) individual health maintenance organization contracts of 
  5.29  coverage with a $500 annual deductible which are in force in 
  5.30  Minnesota; and 
  5.31     (3) other plans of coverage similar to plans offered by the 
  5.32  association based on generally accepted actuarial principles; 
  5.33     (c) the premium premiums for the plan plans with a 
  5.34  $2,000, $5,000, or $10,000 annual deductible shall range from a 
  5.35  minimum of 101 percent to a maximum of 125 percent of the 
  5.36  weighted average of rates charged by those insurers and health 
  6.1   maintenance organizations with individuals enrolled in: 
  6.2      (1) $2,000, $5,000, or $10,000 annual deductible individual 
  6.3   plans, respectively, in force in Minnesota; and 
  6.4      (2) individual health maintenance organization contracts of 
  6.5   coverage with a $2,000, $5,000, or $10,000 annual deductible, 
  6.6   respectively, which are in force in Minnesota; or 
  6.7      (3) other plans of coverage similar to plans offered by the 
  6.8   association based on generally accepted actuarial principles; 
  6.9      (d) the premium for each type of Medicare supplement plan 
  6.10  required to be offered by the association pursuant to section 
  6.11  62E.12 shall range from a minimum of 101 percent to a maximum of 
  6.12  125 percent of the weighted average of rates charged by those 
  6.13  insurers and health maintenance organizations with individuals 
  6.14  enrolled in:  
  6.15     (1) Medicare supplement plans in force in Minnesota; 
  6.16     (2) health maintenance organization Medicare supplement 
  6.17  contracts of coverage which are in force in Minnesota; and 
  6.18     (3) other plans of coverage similar to plans offered by the 
  6.19  association based on generally accepted actuarial principles; 
  6.20  and 
  6.21     (e) the charge for health maintenance organization coverage 
  6.22  shall be based on generally accepted actuarial principles. 
  6.23     The list of insurers and health maintenance organizations 
  6.24  whose rates are used to establish the premium for coverage 
  6.25  offered by the association pursuant to paragraphs (a) to (d) 
  6.26  shall be established by the commissioner on the basis of 
  6.27  information which shall be provided to the association by all 
  6.28  insurers and health maintenance organizations annually at the 
  6.29  commissioner's request.  This information shall include the 
  6.30  number of individuals covered by each type of plan or contract 
  6.31  specified in paragraphs (a) to (d) that is sold, issued, and 
  6.32  renewed by the insurers and health maintenance organizations, 
  6.33  including those plans or contracts available only on a renewal 
  6.34  basis.  The information shall also include the rates charged for 
  6.35  each type of plan or contract.  
  6.36     In establishing premiums pursuant to this section, the 
  7.1   association shall utilize generally accepted actuarial 
  7.2   principles, provided that the association shall not discriminate 
  7.3   in charging premiums based upon sex.  In order to compute a 
  7.4   weighted average for each type of plan or contract specified 
  7.5   under paragraphs (a) to (d), the association shall, using the 
  7.6   information collected pursuant to this subdivision, list 
  7.7   insurers and health maintenance organizations in rank order of 
  7.8   the total number of individuals covered by each insurer or 
  7.9   health maintenance organization.  The association shall then 
  7.10  compute a weighted average of the rates charged for coverage by 
  7.11  all the insurers and health maintenance organizations by: 
  7.12     (1) multiplying the numbers of individuals covered by each 
  7.13  insurer or health maintenance organization by the rates charged 
  7.14  for coverage; 
  7.15     (2) separately summing both the number of individuals 
  7.16  covered by all the insurers and health maintenance organizations 
  7.17  and all the products computed under clause (1); and 
  7.18     (3) dividing the total of the products computed under 
  7.19  clause (1) by the total number of individuals covered.  
  7.20     The association may elect to use a sample of information 
  7.21  from the insurers and health maintenance organizations for 
  7.22  purposes of computing a weighted average.  In no case, however, 
  7.23  may a sample used by the association to compute a weighted 
  7.24  average include information from fewer than the two insurers or 
  7.25  health maintenance organizations highest in rank order.  
  7.26     Sec. 3.  Minnesota Statutes 2002, section 62E.091, is 
  7.27  amended to read: 
  7.28     62E.091 [APPROVAL OF STATE PLAN PREMIUMS.] 
  7.29     The association shall submit to the commissioner any 
  7.30  premiums it proposes to become effective for coverage under the 
  7.31  comprehensive health insurance plan, pursuant to section 62E.08, 
  7.32  subdivision 3.  No later than 45 days before the effective date 
  7.33  for premiums specified in section 62E.08, subdivision 3, the 
  7.34  commissioner shall approve, modify, or reject the proposed 
  7.35  premiums on the basis of the following criteria:  
  7.36     (a) whether the association has complied with the 
  8.1   provisions of section 62E.11, subdivision 11; 
  8.2      (b) whether the association has submitted the proposed 
  8.3   premiums in a manner which provides sufficient time for 
  8.4   individuals covered under the comprehensive insurance plan to 
  8.5   receive notice of any premium increase no less than 30 days 
  8.6   prior to the effective date of the increase; 
  8.7      (c) the degree to which the association's computations and 
  8.8   conclusions are consistent with section 62E.08; 
  8.9      (d) the degree to which any sample used to compute a 
  8.10  weighted average by the association pursuant to section 62E.08 
  8.11  reasonably reflects circumstances existing in the private 
  8.12  marketplace for individual coverage; 
  8.13     (e) the degree to which a weighted average computed 
  8.14  pursuant to section 62E.08 that uses information pertaining to 
  8.15  individual coverage available only on a renewal basis reflects 
  8.16  the circumstances existing in the private marketplace for 
  8.17  individual coverage; 
  8.18     (f) a comparison of the proposed increases with increases 
  8.19  in the cost of medical care and increases experienced in the 
  8.20  private marketplace for individual coverage; 
  8.21     (g) the financial consequences to enrollees of the proposed 
  8.22  increase; 
  8.23     (h) the actuarially projected effect of the proposed 
  8.24  increase upon both total enrollment in, and the nature of the 
  8.25  risks assumed by, the comprehensive health insurance plan; 
  8.26     (i) the relative solvency of the contributing members; and 
  8.27     (j) other factors deemed relevant by the commissioner. 
  8.28     In no case, however, may the commissioner approve premiums 
  8.29  for those plans of coverage described in section 62E.08, 
  8.30  subdivision 1, paragraphs (a) to (c) (d), that are lower than 
  8.31  101 percent or greater than 125 percent of the weighted averages 
  8.32  computed by the association pursuant to section 62E.08.  The 
  8.33  commissioner shall support a decision to approve, modify, or 
  8.34  reject any premium proposed by the association with written 
  8.35  findings and conclusions addressing each criterion specified in 
  8.36  this section.  If the commissioner does not approve, modify, or 
  9.1   reject the premiums proposed by the association sooner than 45 
  9.2   days before the effective date for premiums specified in section 
  9.3   62E.08, subdivision 3, the premiums proposed by the association 
  9.4   under this section become effective.  
  9.5      Sec. 4.  Minnesota Statutes 2002, section 62E.12, is 
  9.6   amended to read: 
  9.7      62E.12 [MINIMUM BENEFITS OF COMPREHENSIVE HEALTH INSURANCE 
  9.8   PLAN.] 
  9.9      (a) The association through its comprehensive health 
  9.10  insurance plan shall offer policies which provide the benefits 
  9.11  of a number one qualified plan and a number two qualified plan, 
  9.12  except that the maximum lifetime benefit on these plans shall be 
  9.13  $2,800,000; and an extended basic Medicare supplement plan and a 
  9.14  basic Medicare supplement plan as described in sections 62A.31 
  9.15  to 62A.44.  The association may also offer a plan that is 
  9.16  identical to a number one and number two qualified plan except 
  9.17  that it has a $2,000 annual deductible and a $2,800,000 maximum 
  9.18  lifetime benefit.  The association, subject to the approval of 
  9.19  the commissioner, may also offer plans that are identical to the 
  9.20  number one or number two qualified plan, except that they have 
  9.21  annual deductibles of $5,000 and $10,000, respectively; have 
  9.22  limitations on total annual out-of-pocket expenses equal to 
  9.23  those annual deductibles and therefore cover 100 percent of the 
  9.24  allowable cost of covered services in excess of those annual 
  9.25  deductibles; and have a $2,800,000 maximum lifetime benefit. 
  9.26     (b) The requirement that a policy issued by the association 
  9.27  must be a qualified plan is satisfied if the association 
  9.28  contracts with a preferred provider network and the level of 
  9.29  benefits for services provided within the network satisfies the 
  9.30  requirements of a qualified plan.  If the association uses a 
  9.31  preferred provider network, payments to nonparticipating 
  9.32  providers must meet the minimum requirements of section 72A.20, 
  9.33  subdivision 15.  
  9.34     (c) The association shall offer health maintenance 
  9.35  organization contracts in those areas of the state where a 
  9.36  health maintenance organization has agreed to make the coverage 
 10.1   available and has been selected as a writing carrier.  
 10.2      (d) Notwithstanding the provisions of section 62E.06 and 
 10.3   unless those charges are billed by a provider that is part of 
 10.4   the association's preferred provider network, the state plan 
 10.5   shall exclude coverage of services of a private duty nurse other 
 10.6   than on an inpatient basis and any charges for treatment in a 
 10.7   hospital located outside of the state of Minnesota in which the 
 10.8   covered person is receiving treatment for a mental or nervous 
 10.9   disorder, unless similar treatment for the mental or nervous 
 10.10  disorder is medically necessary, unavailable in Minnesota and 
 10.11  provided upon referral by a licensed Minnesota medical 
 10.12  practitioner. 
 10.13     Sec. 5.  Minnesota Statutes 2002, section 62E.13, 
 10.14  subdivision 2, is amended to read: 
 10.15     Subd. 2.  [SELECTION OF WRITING CARRIER.] The association 
 10.16  may select policies and contracts, or parts thereof, submitted 
 10.17  by a member or members of the association, or by the association 
 10.18  or others, to develop specifications for bids from any entity 
 10.19  which wishes to be selected as a writing carrier to administer 
 10.20  the state plan.  The selection of the writing carrier shall be 
 10.21  based upon criteria established by the board of directors of the 
 10.22  association and approved by the commissioner.  The criteria 
 10.23  shall outline specific qualifications that an entity must 
 10.24  satisfy in order to be selected and, at a minimum, shall include 
 10.25  the entity's proven ability to handle large group accident and 
 10.26  health insurance cases, efficient claim paying capacity, and the 
 10.27  estimate of total charges for administering the plan.  The 
 10.28  association may select separate writing carriers for the two 
 10.29  types of qualified plans and the $2,000, $5,000, and $10,000 
 10.30  deductible plan plans, the qualified medicare supplement plan, 
 10.31  and the health maintenance organization contract. 
 10.32     Sec. 6.  Minnesota Statutes 2002, section 62E.13, is 
 10.33  amended by adding a subdivision to read: 
 10.34     Subd. 3a.  [EXTENSION OF WRITING CARRIER CONTRACT.] Subject 
 10.35  to the approval of the commissioner, and subject to the consent 
 10.36  of the writing carrier, the association may extend the effective 
 11.1   writing carrier contract for a period not to exceed three years, 
 11.2   if the association and the commissioner determine that it would 
 11.3   be in the best interest of the association's enrollees and 
 11.4   contributing members.  This subdivision applies notwithstanding 
 11.5   anything to the contrary in subdivisions 2 and 3. 
 11.6      Sec. 7.  Minnesota Statutes 2002, section 62E.14, is 
 11.7   amended to read: 
 11.8      62E.14 [ENROLLMENT BY AN ELIGIBLE PERSON.] 
 11.9      Subdivision 1.  [CERTIFICATE APPLICATION, CONTENTS.] The 
 11.10  comprehensive health insurance plan shall be open for enrollment 
 11.11  by eligible persons.  An eligible person shall enroll by 
 11.12  submission of a certificate of eligibility an application to the 
 11.13  writing carrier.  The certificate shall application must provide 
 11.14  the following: 
 11.15     (a) name, address, age, list of residences for the 
 11.16  immediately preceding six months and length of time at current 
 11.17  residence of the applicant; 
 11.18     (b) name, address, and age of spouse and children if any, 
 11.19  if they are to be insured; 
 11.20     (c) evidence of rejection, a requirement of restrictive 
 11.21  riders, a rate up, or a preexisting conditions limitation on a 
 11.22  qualified plan, the effect of which is to substantially reduce 
 11.23  coverage from that received by a person considered a standard 
 11.24  risk, by at least one association member within six months of 
 11.25  the date of the certificate application, or other eligibility 
 11.26  requirements adopted by rule by the commissioner which are not 
 11.27  inconsistent with this chapter and which evidence that a person 
 11.28  is unable to obtain coverage substantially similar to that which 
 11.29  may be obtained by a person who is considered a standard risk; 
 11.30     (d) if the applicant has been terminated from individual 
 11.31  health coverage which does not provide replacement coverage, 
 11.32  evidence that no replacement coverage that meets the 
 11.33  requirements of section 62D.121 was offered, and evidence of 
 11.34  termination of individual health coverage by an insurer, 
 11.35  nonprofit health service plan corporation, or health maintenance 
 11.36  organization, provided that the contract or policy has been 
 12.1   terminated for reasons other than (1) failure to pay the charge 
 12.2   for health care coverage; (2) failure to make copayments 
 12.3   required by the health care plan; (3) enrollee moving out of the 
 12.4   area served; or (4) a materially false statement or 
 12.5   misrepresentation by the enrollee in the application for 
 12.6   membership the terminated contract or policy; and 
 12.7      (e) a designation of the coverage desired. 
 12.8      An eligible person may not purchase more than one policy 
 12.9   from the state plan.  Upon ceasing to be a resident of Minnesota 
 12.10  a person is no longer eligible to purchase or renew coverage 
 12.11  under the state plan, except as required by state or federal law 
 12.12  with respect to renewal of Medicare supplement coverage. 
 12.13     Subd. 2.  [WRITING CARRIER'S RESPONSE.] Within 30 days of 
 12.14  receipt of the certificate application described in subdivision 
 12.15  1, the writing carrier shall either reject the application for 
 12.16  failing to comply with the requirements in subdivision 1 or 
 12.17  forward the eligible person a notice of acceptance and billing 
 12.18  information.  If the applicant otherwise complies with the 
 12.19  requirements of sections 62E.01 to 62E.19, insurance shall be 
 12.20  effective immediately upon receipt of the first month's state 
 12.21  plan premium, and shall be retroactive to the date of the 
 12.22  application, if the applicant otherwise complies with the 
 12.23  requirements of sections 62E.01 to 62E.19 the application was 
 12.24  received by the writing carrier, unless a different effective 
 12.25  date is provided in this section. 
 12.26     Subd. 3.  [PREEXISTING CONDITIONS.] No person who obtains 
 12.27  coverage pursuant to this section shall be covered for any 
 12.28  preexisting condition during the first six months of coverage 
 12.29  under the state plan if the person was diagnosed or treated for 
 12.30  that condition during the 90 days immediately preceding the 
 12.31  filing of an application date the application was received by 
 12.32  the writing carrier, except as provided under subdivisions 4, 
 12.33  4a, 4b, 4c, 4d, 5, 6, and 7 and section 62E.18. 
 12.34     Subd. 3a.  [WAIVER OF PREEXISTING CONDITION.] A person may 
 12.35  enroll in the comprehensive health plan with a waiver of the 
 12.36  preexisting condition limitation described in section 62E.14, 
 13.1   subdivision 3, provided that the person meets the following 
 13.2   requirements: 
 13.3      (1) group coverage was provided through a rehabilitation 
 13.4   facility defined in section 268A.01, subdivision 6, and coverage 
 13.5   was terminated; 
 13.6      (2) all other eligibility requirements for enrollment in 
 13.7   the comprehensive health plan are met; and 
 13.8      (3) coverage is applied for within the person submitted an 
 13.9   application that was received by the writing carrier no later 
 13.10  than 90 days of after termination of previous coverage. 
 13.11     Subd. 4.  [WAIVER OF PREEXISTING CONDITIONS FOR MEDICARE 
 13.12  SUPPLEMENT PLAN ENROLLEES.] Notwithstanding the above, any 
 13.13  Minnesota resident holder of a policy or certificate of Medicare 
 13.14  supplement coverages pursuant to sections 62A.315 and 62A.316, 
 13.15  or Medicare supplement plans previously approved by the 
 13.16  commissioner, may enroll in the comprehensive health insurance 
 13.17  plan as described in section 62E.07, with a waiver of the 
 13.18  preexisting condition as described in subdivision 3, without 
 13.19  interruption in coverage, provided, that the policy or 
 13.20  certificate has been terminated by the insurer for reasons other 
 13.21  than nonpayment of premium and, provided further, that the 
 13.22  option to enroll in the plan is exercised within through 
 13.23  submitting an application received by the writing carrier no 
 13.24  later than 90 days of after termination of the existing contract 
 13.25  or certificate. 
 13.26     Coverage in the state plan for purposes of this section 
 13.27  shall be effective on the date of termination upon completion 
 13.28  receipt of the proper application by the writing carrier and 
 13.29  payment of the required premium.  The application must include 
 13.30  evidence of termination of the existing policy or certificate. 
 13.31     Subd. 4a.  [WAIVER OF PREEXISTING CONDITIONS FOR MINNESOTA 
 13.32  RESIDENTS.] A person may enroll in the comprehensive health plan 
 13.33  with a waiver of the preexisting condition limitation described 
 13.34  in subdivision 3, provided that the following requirements are 
 13.35  met: 
 13.36     (1) the person is a Minnesota resident eligible to enroll 
 14.1   in the comprehensive health plan; 
 14.2      (2) the person: 
 14.3      (a) would be eligible for continuation under federal or 
 14.4   state law if continuation coverage were available or were 
 14.5   required to be available; 
 14.6      (b) would be eligible for continuation under clause (a) 
 14.7   except that the person was exercising continuation rights and 
 14.8   the continuation period required under federal or state law has 
 14.9   expired; or 
 14.10     (c) is eligible for continuation of health coverage under 
 14.11  federal or state law; 
 14.12     (3) continuation coverage is not available; and 
 14.13     (4) the person applies person's application for coverage 
 14.14  within is received by the writing carrier no later than 90 days 
 14.15  of after termination of prior coverage from a policy or plan. 
 14.16     Coverage in the comprehensive health plan is effective on 
 14.17  the date of termination of prior coverage.  The availability of 
 14.18  conversion rights does not affect a person's rights under this 
 14.19  subdivision. 
 14.20     Subd. 4b.  [WAIVER OF PREEXISTING CONDITIONS FOR PERSONS 
 14.21  COVERED BY RETIREE PLANS.] A person who was covered by a retiree 
 14.22  health care plan may enroll in the comprehensive health plan 
 14.23  with a waiver of the preexisting condition limitation described 
 14.24  in subdivision 3, provided that the following requirements are 
 14.25  met: 
 14.26     (1) the person is a Minnesota resident eligible to enroll 
 14.27  in the comprehensive health plan; 
 14.28     (2) the person was covered by a retiree health care plan 
 14.29  from an employer and the coverage is no longer available to the 
 14.30  person; and 
 14.31     (3) the person applies person's application for coverage 
 14.32  within is received by the writing carrier no later than 90 days 
 14.33  of after termination of prior coverage. 
 14.34     Coverage in the comprehensive health plan is effective on 
 14.35  the date of termination of prior coverage.  The availability of 
 14.36  conversion rights does not affect a person's rights under this 
 15.1   section. 
 15.2      Subd. 4c.  [WAIVER OF PREEXISTING CONDITIONS FOR PERSONS 
 15.3   WHOSE COVERAGE IS TERMINATED OR WHO EXCEED THE MAXIMUM LIFETIME 
 15.4   BENEFIT.] (a) A Minnesota resident may enroll in the 
 15.5   comprehensive health plan with a waiver of the preexisting 
 15.6   condition limitation described in subdivision 3 if that person 
 15.7   applies persons's application for coverage within is received by 
 15.8   the writing carrier no later than 90 days of after termination 
 15.9   of prior coverage and if the termination is for reasons other 
 15.10  than fraud or nonpayment of premiums.  
 15.11     For purposes of this paragraph, termination of prior 
 15.12  coverage includes exceeding the maximum lifetime benefit of 
 15.13  existing coverage. 
 15.14     Coverage in the comprehensive health plan is effective on 
 15.15  the date of termination of prior coverage.  The availability of 
 15.16  conversion rights does not affect a person's rights under this 
 15.17  paragraph. 
 15.18     This section does not apply to prior coverage provided 
 15.19  under policies designed primarily to provide coverage payable on 
 15.20  a per diem, fixed indemnity, or nonexpense incurred basis, or 
 15.21  policies providing only accident coverage. 
 15.22     (b) An eligible individual, as defined under United States 
 15.23  Code, chapter 42, section 300gg-41(b) may enroll in the 
 15.24  comprehensive health insurance plan with a waiver of the 
 15.25  preexisting condition limitation described in subdivision 3 and 
 15.26  a waiver of the evidence of rejection or similar events 
 15.27  described in subdivision 1, clause (c).  The eligible individual 
 15.28  must apply for enrollment under this paragraph within by 
 15.29  submitting a substantially complete application that is received 
 15.30  by the writing carrier no later than 63 days of after 
 15.31  termination of prior coverage, and coverage under the 
 15.32  comprehensive health insurance plan is effective as of the date 
 15.33  of receipt of the complete application.  The six month 
 15.34  durational residency requirement provided in section 62E.02, 
 15.35  subdivision 13, does not apply with respect to eligibility for 
 15.36  enrollment under this paragraph, but the applicant must be a 
 16.1   Minnesota resident as of the date of that the application was 
 16.2   received by the writing carrier.  A person's eligibility to 
 16.3   enroll under this paragraph does not affect the person's 
 16.4   eligibility to enroll under any other provision. 
 16.5      (c) A qualifying individual, as defined in the Internal 
 16.6   Revenue Code of 1986, section 35(e)(2)(B), who is eligible under 
 16.7   the Federal Trade Act of 2002 for the credit for health 
 16.8   insurance costs under the Internal Revenue Code of 1986, section 
 16.9   35, may enroll in the comprehensive health insurance plan with a 
 16.10  waiver of the preexisting condition limitation described in 
 16.11  subdivision 3, and without presenting evidence of rejection or 
 16.12  similar requirements described in subdivision 1, paragraph (c).  
 16.13  The six-month durational residency requirement provided in 
 16.14  section 62E.02, subdivision 13, does not apply with respect to 
 16.15  eligibility for enrollment under this paragraph, but the 
 16.16  applicant must be a Minnesota resident as of the date of 
 16.17  application.  A person's eligibility to enroll under this 
 16.18  paragraph does not affect the person's eligibility to enroll 
 16.19  under any other provision.  This paragraph is intended solely to 
 16.20  meet the minimum requirements necessary to qualify the 
 16.21  comprehensive health insurance plan as qualified health coverage 
 16.22  under the Internal Revenue Code of 1986, section 35(e)(2). 
 16.23     Subd. 4d.  [INSURER INSOLVENCY; WAIVER OF PREEXISTING 
 16.24  CONDITIONS.] A Minnesota resident who is otherwise eligible may 
 16.25  enroll in the comprehensive health insurance plan with a waiver 
 16.26  of the preexisting condition limitation described in subdivision 
 16.27  3, if that person applies submits an application for coverage 
 16.28  within that is received by the writing carrier no later than 90 
 16.29  days of after termination of prior coverage due to the 
 16.30  insolvency of the insurer.  
 16.31     Coverage in the comprehensive insurance plan is effective 
 16.32  on the date of termination of prior coverage.  The availability 
 16.33  of conversion rights does not affect a person's rights under 
 16.34  this subdivision. 
 16.35     Subd. 4e.  [WAIVER OF PREEXISTING CONDITIONS; PERSONS 
 16.36  COVERED BY PUBLICLY FUNDED HEALTH PROGRAMS.] A person may enroll 
 17.1   in the comprehensive plan with a waiver of the preexisting 
 17.2   condition limitation in subdivision 3, provided that: 
 17.3      (1) the person was formerly enrolled in the medical 
 17.4   assistance, general assistance medical care, or MinnesotaCare 
 17.5   program; 
 17.6      (2) the person is a Minnesota resident; and 
 17.7      (3) the person applies within submits an application for 
 17.8   coverage that is received by the writing carrier no later than 
 17.9   90 days of after termination from medical assistance, general 
 17.10  assistance medical care, or MinnesotaCare program. 
 17.11     Subd. 5.  [TERMINATED EMPLOYEES.] An employee who is 
 17.12  voluntarily or involuntarily terminated or laid off from 
 17.13  employment and unable to exercise the option to continue 
 17.14  coverage under section 62A.17 may enroll, within by submitting 
 17.15  an application that is received by the writing carrier no later 
 17.16  than 90 days of after termination or layoff, with a waiver of 
 17.17  the preexisting condition limitation set forth in subdivision 3 
 17.18  and a waiver of the evidence of rejection set forth in 
 17.19  subdivision 1, paragraph (c). 
 17.20     Subd. 6.  [TERMINATION OF INDIVIDUAL POLICY OR CONTRACT.] A 
 17.21  Minnesota resident who holds an individual health maintenance 
 17.22  contract, individual nonprofit health service corporation 
 17.23  contract, or an individual insurance policy previously approved 
 17.24  by the commissioners of health or commerce, may enroll in the 
 17.25  comprehensive health insurance plan with a waiver of the 
 17.26  preexisting condition as described in subdivision 3, without 
 17.27  interruption in coverage, provided (1) no replacement coverage 
 17.28  that meets the requirements of section 62D.121 was offered by 
 17.29  the contributing member, and (2) the policy or contract has been 
 17.30  terminated for reasons other than (a) nonpayment of premium; (b) 
 17.31  failure to make copayments required by the health care plan; (c) 
 17.32  moving out of the area served; or (d) a materially false 
 17.33  statement or misrepresentation by the enrollee in the 
 17.34  application for membership the terminated policy or contract; 
 17.35  and, provided further, that the option to enroll in the plan is 
 17.36  exercised within by submitting an application that is received 
 18.1   by the writing carrier no later than 90 days of after 
 18.2   termination of the existing policy or contract. 
 18.3      Coverage allowed under this section is effective when the 
 18.4   contract or policy is terminated and the enrollee has completed 
 18.5   submitted the proper application that is received within the 
 18.6   time period stated in this subdivision and paid the required 
 18.7   premium or fee. 
 18.8      Expenses incurred from the preexisting conditions of 
 18.9   individuals enrolled in the state plan under this subdivision 
 18.10  must be paid by the contributing member canceling coverage as 
 18.11  set forth in section 62E.11, subdivision 10. 
 18.12     The application must include evidence of termination of the 
 18.13  existing policy or certificate as required in subdivision 1. 
 18.14     Subd. 7.  [TERMINATIONS OF CONVERSION POLICIES.] (a) A 
 18.15  Minnesota resident who is covered by a conversion policy or 
 18.16  contract of health coverage may enroll in the comprehensive 
 18.17  health plan with a waiver of the preexisting condition 
 18.18  limitation in subdivision 3 and a waiver of the evidence of 
 18.19  rejection in subdivision 1, paragraph (c), at any time for any 
 18.20  reason by submitting an application that is received by the 
 18.21  writing carrier during the term of coverage. 
 18.22     (b) A Minnesota resident who was covered by a conversion 
 18.23  policy or contract of health coverage may enroll in the 
 18.24  comprehensive health plan with a waiver of the preexisting 
 18.25  condition limitation in subdivision 3 and a waiver of the 
 18.26  evidence of rejection in subdivision 1, paragraph (c), if that 
 18.27  person applies for coverage within by submitting an application 
 18.28  that is received by the writing carrier no later than 90 days 
 18.29  after termination of the conversion policy or contract coverage 
 18.30  regardless of:  (1) the reasons for the termination; or (2) the 
 18.31  party terminating coverage.  
 18.32     (c) Coverage under this subdivision is effective upon 
 18.33  termination of prior coverage if the enrollee has submitted a 
 18.34  completed application that is received within the time period 
 18.35  stated in paragraph (a) or (b), whichever applies, and paid the 
 18.36  required premium or fee. 
 19.1      Sec. 8.  Minnesota Statutes 2002, section 62E.18, is 
 19.2   amended to read: 
 19.3      62E.18 [HEALTH INSURANCE FOR RETIRED EMPLOYEES NOT ELIGIBLE 
 19.4   FOR MEDICARE.] 
 19.5      A Minnesota resident who is age 65 or over and is not 
 19.6   eligible for the health insurance benefits of the federal 
 19.7   Medicare program is entitled to purchase the benefits of a 
 19.8   qualified plan, one or two, or the $2,000, $5,000, or $10,000 
 19.9   annual deductible plan if available, offered by the Minnesota 
 19.10  comprehensive health association without any of the limitations 
 19.11  set forth in section 62E.14, subdivision 1, paragraph (c), and 
 19.12  subdivision 3. 
 19.13     Sec. 9.  [EFFECTIVE DATE.] 
 19.14     Sections 1 to 8 are effective the day following final 
 19.15  enactment and apply to applications received on or after that 
 19.16  date.