HF 1742

as introduced - 80th Legislature (1997 - 1998) Posted on 12/15/2009 12:00am

  1.1                          A bill for an act 
  1.2             relating to health; establishing health care 
  1.3             purchasing alliances; establishing direct provider 
  1.4             contracting; permitting the commissioner of health to 
  1.5             waive hospital and other supervised living facility 
  1.6             licensing standards; amending Minnesota Statutes 1996, 
  1.7             section 144.56, by adding a subdivision; proposing 
  1.8             coding for new law as Minnesota Statutes, chapters 
  1.9             62T; and 62U. 
  1.10  BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  1.11                  HEALTH CARE PURCHASING ALLIANCES 
  1.12     Section 1.  [62T.001] [PURPOSE.] 
  1.13     The legislature finds that it is important for communities 
  1.14  to maintain and enhance their health care infrastructure by 
  1.15  matching the needs of the community for access to services with 
  1.16  the community's health care resources.  Therefore, it is the 
  1.17  intent of the legislature to allow the forming of health care 
  1.18  purchasing alliances and to permit health care providers to 
  1.19  negotiate directly with those alliances for the provision of 
  1.20  health care services. 
  1.21     Sec. 2.  [62T.01] [DEFINITIONS.] 
  1.22     Subdivision 1.  [APPLICABILITY.] For purposes of this 
  1.23  chapter, the terms defined in this section have the meanings 
  1.24  given them. 
  1.25     Subd. 2.  [COMMISSIONER.] "Commissioner" means the 
  1.26  commissioner of commerce. 
  1.27     Subd. 3.  [HEALTH CARE PROVIDING ENTITY.] "Health care 
  2.1   providing entity" means any health care provider licensed to 
  2.2   provide care in Minnesota, including, but not limited to, 
  2.3   physicians, hospitals, and networks of providers. 
  2.4      Subd. 4.  [HEALTH CARE PURCHASING ALLIANCE OR 
  2.5   ALLIANCE.] "Health care purchasing alliance" or "alliance" means 
  2.6   a business organization created to negotiate the purchase of 
  2.7   health care services for its members.  A health care purchasing 
  2.8   alliance may include, but is not limited to, a grouping of: 
  2.9      (1) businesses, including small businesses with one 
  2.10  employee; 
  2.11     (2) trade association members, church organizations, or 
  2.12  union members; 
  2.13     (3) self-insured businesses, including businesses with one 
  2.14  employee; 
  2.15     (4) municipal or county employees; 
  2.16     (5) other government entities; or 
  2.17     (6) any combination of the above. 
  2.18     The alliance may determine the definition of a business of 
  2.19  one employee, but must adhere to its definition and show no bias 
  2.20  in selection of members. 
  2.21     Subd. 5.  [MEMBER.] "Member" means any business, including 
  2.22  all businesses of one employee participating in the alliance to 
  2.23  purchase health care for employees. 
  2.24     Subd. 6.  [PARTICIPANT.] "Participant" means all employees 
  2.25  of members purchasing coverage through the alliance. 
  2.26     Sec. 3.  [62T.02] [STRUCTURE.] 
  2.27     A health care purchasing alliance may be organized as a 
  2.28  nonprofit or for-profit corporation, cooperative, partnership, 
  2.29  or similar business organization for the purpose of purchasing 
  2.30  health care services for its members.  An alliance may be 
  2.31  organized by any individual or group for the purpose of carrying 
  2.32  out the provisions of this chapter. 
  2.33     Sec. 4.  [62T.03] [PURCHASING.] 
  2.34     A health care purchasing alliance may purchase health care 
  2.35  services on behalf of its members through arrangements with 
  2.36  health maintenance organizations as established in chapter 62D, 
  3.1   health plan corporations as established in chapter 62C, other 
  3.2   health insurers licensed by the state, or by directly 
  3.3   contracting with accountable provider networks established under 
  3.4   chapter 62U.  The purchasing alliance may purchase service 
  3.5   directly or may contract with a third party to provide services, 
  3.6   including administrative services. 
  3.7      Sec. 5.  [62T.04] [BENEFITS.] 
  3.8      A health care purchasing alliance may negotiate benefits 
  3.9   packages on behalf of its members, which may include a high 
  3.10  deductible benefits package, a package with higher copayments, 
  3.11  or a plan based on a self-insured member's previous health 
  3.12  benefits packet.  A purchasing alliance must offer participating 
  3.13  employees an option of coverage that offers the benefits listed 
  3.14  in section 62L.05, subdivision 4. 
  3.15     Sec. 6.  [62T.05] [CONSUMER CHOICE.] 
  3.16     The health care purchasing alliance shall make efforts to 
  3.17  provide employee participants with choices in health coverage by 
  3.18  offering more than one option or package of coverage. 
  3.19     Sec. 7.  [62T.06] [PORTABILITY.] 
  3.20     Provisions in state and federal law establishing 
  3.21  portability of health coverage and requiring out-of-area 
  3.22  coverage for participants are applicable under this section. 
  3.23     Sec. 8.  [62T.07] [PURCHASING POOLS.] 
  3.24     The health care purchasing alliance may form purchasing 
  3.25  pools where members are allowed to redistribute risk between 
  3.26  individual members using sound actuarial principles.  These risk 
  3.27  arrangements are subject to audit by the commissioner of 
  3.28  commerce if due cause exists. 
  3.29     Sec. 9.  [62T.08] [CONSUMER PROTECTION STANDARDS.] 
  3.30     (a) The network is accountable for all marketing and 
  3.31  materials offered to members, participants, and prospective 
  3.32  members and participants. 
  3.33     (b) The health care purchasing alliance must design, 
  3.34  establish, and maintain a centralized employee complaint 
  3.35  resolution system, which is confidential, prompt, customized, 
  3.36  and available 24 hours a day. 
  4.1      (c) The alliance may provide the complaint resolution 
  4.2   system directly or may contract with a vendor for this service. 
  4.3      (d) In the event a health care purchasing alliance 
  4.4   dissolves, the alliance shall continue to purchase coverage for 
  4.5   its members for a period of 60 days, or until the alliance's 
  4.6   members have purchased alternative coverage for its employee 
  4.7   participants within 60 days. 
  4.8      Sec. 10.  [62T.09] [REGISTRATION.] 
  4.9      Each health care purchasing alliance shall register with 
  4.10  the commissioner within 30 days of commencement of its 
  4.11  operations.  The registration shall include the name and address 
  4.12  of the alliance and of each member and copies of any agreements 
  4.13  or contracts between the alliance and any health care providing 
  4.14  entity or vendor. 
  4.15     Sec. 11.  [62T.10] [EXEMPTION FROM INSURANCE LAWS.] 
  4.16     The activities of health care purchasing alliances shall 
  4.17  not be affected by application of chapter 60A, 62A, 62C, 62D, or 
  4.18  62Q, or other state insurance laws. 
  4.19                    DIRECT PROVIDER CONTRACTING 
  4.20     Sec. 12.  [62U.01] [ACCOUNTABLE PROVIDER NETWORKS.] 
  4.21     An accountable provider network that meets the requirements 
  4.22  of sections 62U.01 to 62U.09 may directly contract with health 
  4.23  care purchasing alliances as established in chapter 62T for the 
  4.24  provision of health care services.  The accountable provider 
  4.25  network or the health care purchasing alliance shall not, solely 
  4.26  on the basis of that contract, be considered in the business of 
  4.27  insurance or subject to any provision relating to health 
  4.28  carriers, except as provided in this section.  A grant of 
  4.29  contracting power under this chapter shall not be interpreted to 
  4.30  permit or prohibit any other lawful arrangement between a health 
  4.31  care provider and a qualified employer. 
  4.32     Sec. 13.  [62U.02] [DEFINITIONS.] 
  4.33     Subdivision 1.  [APPLICABILITY.] For purposes of sections 
  4.34  62U.01 to 62U.09, the terms defined in this section have the 
  4.35  meanings given them. 
  4.36     Subd. 2.  [ACCOUNTABLE PROVIDER NETWORK OR 
  5.1   NETWORK.] "Accountable provider network" or "network" means an 
  5.2   organization such as an independent physician association, 
  5.3   limited liability partnership, limited liability corporation, 
  5.4   professional association, cooperative, or other organization 
  5.5   consisting of providers organized under this chapter and 
  5.6   operated to market health care services to health care 
  5.7   purchasing alliances for a negotiated rate. 
  5.8      Subd. 3.  [ACCREDITED GUARANTOR.] "Accredited guarantor" 
  5.9   means an entity that the commissioner recognizes as having the 
  5.10  reserves needed to cover any losses that cannot be absorbed by 
  5.11  the network. 
  5.12     Subd. 4.  [COMMISSIONER.] "Commissioner" means the 
  5.13  commissioner of commerce. 
  5.14     Subd. 5.  [HEALTH CARE PURCHASING ALLIANCE.] "Health care 
  5.15  purchasing alliance" means an organization established under 
  5.16  chapter 62T. 
  5.17     Sec. 14.  [62U.03] [SOLVENCY.] 
  5.18     The network must demonstrate an ability to maintain 
  5.19  solvency to the commissioner.  Solvency may be demonstrated by: 
  5.20     (1) using an accredited guarantor.  The accredited 
  5.21  guarantor is the entity responsible for ensuring the network's 
  5.22  solvency and may be an insurance company, health maintenance 
  5.23  organization, preferred provider organization, other nonprofit 
  5.24  organization, bank, county, group of businesses, or any other 
  5.25  entity recognized as having the reserves to cover any losses 
  5.26  that cannot be absorbed by the network; or 
  5.27     (2) depositing an amount equal to 30 days' premiums for all 
  5.28  alliance enrollees with any organization or trustee acceptable 
  5.29  to the commissioner through which a custodial or controlled 
  5.30  account is utilized with interest accruing to the network. 
  5.31     Sec. 15.  [62U.04] [ACCREDITED GUARANTOR.] 
  5.32     Subdivision 1.  [REQUIREMENTS.] A network using an 
  5.33  accredited guarantor to demonstrate solvency must have a 
  5.34  contractual relationship with the accredited guarantor.  The 
  5.35  contract must include a commitment on the part of the accredited 
  5.36  guarantor to guarantee the duties, responsibilities, and 
  6.1   obligations of the network for a specified time of no less than 
  6.2   120 days in the event of an insolvency or bankruptcy by the 
  6.3   network.  The contract must specify the financial obligations of 
  6.4   the accredited guarantor and the network, and the role of the 
  6.5   accredited guarantor in the event of a financial insolvency.  
  6.6   The contract shall specify the period of time, in excess of 45 
  6.7   days, during which the network and its member providers are 
  6.8   required to continue to provide services under existing 
  6.9   contracts with health care purchasing alliances in the event of 
  6.10  the insolvency or the bankruptcy of the network. 
  6.11     Subd. 2.  [APPROVAL.] The commissioner shall review the 
  6.12  proposed contract between a network and its accredited 
  6.13  guarantor.  The commissioner may reject a submission or require 
  6.14  modifications prior to approval.  If the commissioner has not 
  6.15  acted within 90 days of submission, the contracts are considered 
  6.16  to be approved. 
  6.17     Sec. 16.  [62U.05] [STOP LOSS INSURANCE.] 
  6.18     An accredited guarantor may require by contract that the 
  6.19  network carry stop loss or excess loss insurance from an 
  6.20  insurance company licensed to do business in this state, or if 
  6.21  the accredited guarantor is an insurance company licensed to do 
  6.22  business in this state, the accredited guarantor may provide the 
  6.23  stop loss insurance. 
  6.24     Sec. 17.  [62U.06] [SERVICES NOT OFFERED BY NETWORK.] 
  6.25     A network may contract for administrative and health care 
  6.26  services not deliverable by the network.  The network may 
  6.27  contract with a health maintenance organization, preferred 
  6.28  provider organization, insurance company, another accountable 
  6.29  provider network, or any other vendor.  
  6.30     Sec. 18.  [CONSUMER PROTECTION STANDARDS.] 
  6.31     (a) The network is accountable for all marketing and 
  6.32  materials offered to members, participants, and prospective 
  6.33  members and participants. 
  6.34     (b) The network must design, establish, and maintain a 
  6.35  centralized employee complaint resolution system that is 
  6.36  confidential, prompt, customized, and available 24 hours a day. 
  7.1      (c) The network may provide the complaint resolution system 
  7.2   directly or may contract with a vendor for this service. 
  7.3      Sec. 19.  [62U.07] [REGISTRATION.] 
  7.4      The commissioner shall register all networks established 
  7.5   under section 62U.01 on forms designed by the commissioner, on 
  7.6   an annual basis, and may charge an appropriate fee to cover the 
  7.7   costs of registration.  Networks must comply with all reasonable 
  7.8   information and registration requirements of the commissioner. 
  7.9      Sec. 20.  [62U.08] [PARTICIPANT HELD HARMLESS.] 
  7.10     A network and its members and patrons must not have 
  7.11  recourse against the employee participants of any health care 
  7.12  purchasing alliance, except for health care services rendered 
  7.13  that are not covered by the network or that are in excess of the 
  7.14  maximum lifetime benefit limit.  This requirement applies to, 
  7.15  but is not limited to, nonpayment of the network by the health 
  7.16  care purchasing alliance, solvency of the network, or nonpayment 
  7.17  by the network to a network member or patron. 
  7.18     Sec. 21.  [62U.09] [CONTINUATION OF CARE.] 
  7.19     In the event of an insolvency or bankruptcy of a 
  7.20  dissolution of a health care purchasing alliance, a network and 
  7.21  its members shall continue to deliver the contracted health care 
  7.22  services to participants for a period of 45 days, whether or not 
  7.23  the network receives payment from the health care purchasing 
  7.24  alliance or the employer plan.  Nothing in this section limits 
  7.25  the right of the network to seek payment from the health care 
  7.26  purchasing alliance or the employer plan for services so 
  7.27  rendered. 
  7.28     Sec. 22.  Minnesota Statutes 1996, section 144.56, is 
  7.29  amended by adding a subdivision to read: 
  7.30     Subd. 5.  [WAIVER AUTHORITY.] (a) The commissioner of 
  7.31  health may waive any licensing regulations for facilities 
  7.32  established under sections 144.50 to 144.56 if such waiver 
  7.33  enhances or maintains access to health service in the 
  7.34  community.  The facility applying for the waiver must 
  7.35  demonstrate, to the satisfaction of the commissioner, community 
  7.36  support and a plan for closely monitoring quality through a peer 
  8.1   review organization. 
  8.2      (b) The commissioner of human services shall reimburse for 
  8.3   services at a facility for which the commissioner of health has 
  8.4   waived regulations under this section if such services would 
  8.5   have been reimbursable at a facility where no such waiver had 
  8.6   occurred. 
  8.7      Sec. 23.  [EFFECTIVE DATE.] 
  8.8      Sections 1 to 22 are effective the day following final 
  8.9   enactment.