HF 1704

as introduced - 90th Legislature (2017 - 2018) Posted on 02/27/2017 01:43pm

A bill for an act
relating to health; adding provisions to the Minnesota Health Plan Market Rules;
designating essential community provider; requiring audits of health carriers'
financial records; allowing in certain circumstances continuation of services when
an enrollee changes health plans; amending Minnesota Statutes 2016, sections
62K.10, subdivisions 4, 5; 62Q.19, by adding a subdivision; 62Q.56, by adding a
subdivision; proposing coding for new law in Minnesota Statutes, chapter 62Q.

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

Section 1.

Minnesota Statutes 2016, section 62K.10, subdivision 4, is amended to read:

Subd. 4.

Network adequacy.

new text begin (a) new text end Each designated provider network must include a
sufficient number and type of providers, including providers that specialize in mental health
and substance use disorder services, to ensure that covered services are available to all
enrollees without unreasonable delay. In determining network adequacy, the commissioner
of health shall consider availability of services, including the following:

(1) primary care physician services are available and accessible 24 hours per day, seven
days per week, within the network area;

(2) a sufficient number of primary care physicians have hospital admitting privileges at
one or more participating hospitals within the network area so that necessary admissions
are made on a timely basis consistent with generally accepted practice parameters;

(3) specialty physician service is available through the network or contract arrangement;

(4) mental health and substance use disorder treatment providers are available and
accessible through the network or contract arrangement;

(5) to the extent that primary care services are provided through primary care providers
other than physicians, and to the extent permitted under applicable scope of practice in state
law for a given provider, these services shall be available and accessible; and

(6) the network has available, either directly or through arrangements, appropriate and
sufficient personnel, physical resources, and equipment to meet the projected needs of
enrollees for covered health care services.

new text begin (b) Each carrier offering a health plan in any service area established under section
62K.13 that includes one or more counties with fewer than 32 people per square mile, as
measured by the United States Census Bureau, must offer at least one plan at each metal
level with a designated provider network that includes all available accredited primary care
providers offering health care services within that service area.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day following final enactment and
applies to health plans with an effective date on or after January 1, 2018.
new text end

Sec. 2.

Minnesota Statutes 2016, section 62K.10, subdivision 5, is amended to read:

Subd. 5.

Waiver.

new text begin (a) new text end A health carrier or preferred provider organization may apply to
the commissioner of health for a waiver of the requirements in subdivision 2 or 3 if it is
unable to meet the statutory requirements. A waiver application must be submitted on a
form provided by the commissioner and must:

(1) demonstrate with specific data that the requirement of subdivision 2 or 3 is not
feasible in a particular service area or part of a service area new text begin because:
new text end

new text begin (i) the health carrier or preferred provider organization conducted a good faith search
for providers and there were no providers physically present in the service area; or
new text end

new text begin (ii) the providers physically present in the service area did not meet the health carrier's
or the preferred provider organization's credentialing requirements new text end ; and

(2) include information as to the steps that were and will be taken to address the network
inadequacy.

The waiver shall automatically expire after four years. If a renewal of the waiver is
sought, the commissioner of health shall take into consideration steps that have been taken
to address network adequacy.

new text begin (b) A health carrier or preferred provider organization's contract with an exclusive
provider, such as an accountable care organization or other entity operating a health care
delivery system, is not by itself a basis for a waiver from the requirements of this section.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day following final enactment and
applies to health plans with an effective date on or after January 1, 2018.
new text end

Sec. 3.

Minnesota Statutes 2016, section 62Q.19, is amended by adding a subdivision to
read:

new text begin Subd. 8. new text end

new text begin Federal designation. new text end

new text begin Any provider that meets the definition of an essential
community provider under section 340B of the Public Health Service Act and section
1927(c)(1)(D)(i)(IV) of the Social Security Act must also be designated by the commissioner
as an essential community provider under this section.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day following final enactment and
applies to health plans with an effective date on or after January 1, 2018.
new text end

Sec. 4.

new text begin [62Q.371] AUDIT OF HEALTH CARRIERS.
new text end

new text begin Subdivision 1. new text end

new text begin Applicability. new text end

new text begin This section applies to all health carriers, as defined by
section 62A.011, subdivision 2, and affiliated health plan companies, except for fraternal
benefit societies and joint self-insurance employee health plans.
new text end

new text begin Subd. 2. new text end

new text begin Financial examinations required regularly. new text end

new text begin (a) The legislative auditor shall
annually audit the financial records of all health carriers to determine whether health carriers
properly allocate medical and administrative expenses across various product lines including
but not limited to state public programs, the individual insurance market, the small group
insurance market, the large group insurance market, the market for self-insured businesses
or any insurance market operations outside Minnesota. The audit required by this section
shall adhere to the standards described in section 60A.1291. The first audit shall include
financial records for products sold during the 2012 to 2016 years. Subsequent audits may
be limited to products sold in the single most current year for which data are available.
new text end

new text begin (b) For purposes of the audit, health carriers shall aggregate and make available to the
auditor on request quarterly financial and utilization information for separate lines of
commercial businesses, including the employer market, the individual and small group
market, the market for services delivered to self-insured employers, and commercial health
coverage provided under section 256B.69, subdivision 9c.
new text end

new text begin Subd. 3. new text end

new text begin Administrative expenses. new text end

new text begin The audit shall determine whether health carriers
appropriately attributed administrative expenses and investment income to each respective
product line and whether health carriers' costs for providing all forms of commercial
insurance have been funded exclusively through surplus from commercial lines of business
or built into premiums for the commercial population. The auditor shall use the standard of
"administrative expenses" as described in section 259B.69, subdivision 5i, or describe an
alternative standard determined by the auditor to be appropriate for this audit.
new text end

new text begin Subd. 4. new text end

new text begin Reserves. new text end

new text begin The audit shall evaluate all forms of health carriers' reserves, including
capital reserves, policy deficiency reserves, ongoing claims reserves and other forms of
financial vehicles intended to reserve against financial and business risk, to determine
whether there has been commingling of reserves from state health care programs and
commercial market revenue and make recommendations for any changes to state law required
to prevent the possibility of commingling in the future. The audit shall additionally track
financial transactions between nonprofit foundations or affiliated entities of health carriers
to determine their timing, use and source of transferred funds, including whether the
transferred funds should be classified as reserves.
new text end

new text begin Subd. 5. new text end

new text begin Other state operations. new text end

new text begin The audit shall report on whether financial resources
derived from Minnesota payers have been used to expand or subsidize health carrier business
operations in other states.
new text end

new text begin Subd. 6. new text end

new text begin Provider rate variation. new text end

new text begin As part of the audit, the auditor shall make
recommendations on any changes in law needed to regularly evaluate the differences between
prices extended to providers for commercial and state health care program enrollees through
a statistically valid sampling of rates paid to providers. As part of this effort, the auditor
may consider recommending changes to better align existing public program and commercial
insurance financial reporting by health carriers to the Departments of Human Services,
Health, and Commerce. The auditor may coordinate the activity required by this subdivision
with an existing evaluation effort by the commissioners of human services and health.
new text end

new text begin Subd. 7. new text end

new text begin Access to data. new text end

new text begin (a) The legislative auditor, and any contracted vendor that the
auditor engages to carry out the requirements of this section, shall have timely access to
any health carrier data necessary to complete the requirements of this section. Data requested
from health carriers, including new reporting under subdivision 2, paragraph (b), shall be
provided within 30 days of a written request by the auditor.
new text end

new text begin (b) In addition, the legislative auditor shall have access to all information reported by
health carriers to:
new text end

new text begin (1) the commissioner of health under chapters 62J and 62U and Minnesota Rules, chapters
4642 and 4653;
new text end

new text begin (2) the National Association of Insurance Commissioners;
new text end

new text begin (3) the commissioner of commerce; and
new text end

new text begin (4) any vendor completing the financial audits required under section 256B.69,
subdivision 9e.
new text end

new text begin (c) Effective January 1, 2018, and on a quarterly basis thereafter, each health carrier
must provide to the legislative auditor, and any contracted vendor that it engages to carry
out the requirements of this section, the equivalent commercial health insurance information
for all elements of data described in section 256B.69, subdivision 9c, paragraph (b).
new text end

new text begin Subd. 8. new text end

new text begin Reporting. new text end

new text begin The legislative auditor shall submit an interim report with initial
findings from the audit to the Legislative Audit Commission and the legislative committees
with jurisdiction over health policy and finance by December 1, 2017, and a final report by
May 1, 2018. In subsequent years, the legislative auditor shall publish new audit findings
by April 1.
new text end

new text begin Subd. 9. new text end

new text begin Authority. new text end

new text begin The legislative auditor may use any existing authority under sections
3.971 to 3.979, including the power to subpoena while conducting the audit.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day following final enactment.
new text end

Sec. 5.

Minnesota Statutes 2016, section 62Q.56, is amended by adding a subdivision to
read:

new text begin Subd. 1c. new text end

new text begin Change in health care provider; involuntary termination of coverage. new text end

new text begin (a)
The protections and requirements of subdivision 1a also apply to any enrollee subject to a
change in health plan in the individual market, as defined by section 62A.011, subdivision
5, due to the health plan company's refusal to renew the health plan in the individual market
because the health plan company elects to cease offering individual market health plans in
all or some geographic rating areas of the state.
new text end

new text begin (b) If an enrollee satisfies the eligibility criteria in subdivision 1a, paragraph (b), the
enrollee's new health plan must provide, upon request of the enrollee or the enrollee's health
care provider, authorization to receive services that are otherwise covered under the terms
of the enrollee's new health plan from a provider who provided care on an in-network basis
to the enrollee during the prior calendar year but who is out of network in the enrollee's
new health plan.
new text end

new text begin (c) For all requests for authorization under this subdivision, the health plan company
must grant the request for authorization unless the enrollee does not meet the criteria in
subdivision 1a, paragraph (b), clause (1).
new text end

new text begin (d) Nothing in this section requires a health plan company to provide coverage for a
health care service or treatment that is not covered under the enrollee's health plan.
new text end

new text begin (e) The enrollee's health plan company may require medical records and other supporting
documentation to be submitted with a request for authorization made under subdivision 3
to the extent that the records and other documentation are relevant to a determination
regarding the existence of a condition under in subdivision 1a, paragraph (b). If authorization
is denied, the health plan company must explain the criteria used to make its decision on
the request for authorization and must explain the enrollee's right to appeal the decision. If
an enrollee chooses to appeal a denial, the enrollee must appeal the denial within five
business days of the date on which the enrollee receives the denial. If authorization is granted,
the health plan company must provide the enrollee, within five business days of granting
the authorization, with an explanation of how transition of care will be provided.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day following final enactment and
applies to health plans with an effective date on or after January 1, 2018.
new text end