HF 2670

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

  1.1                          A bill for an act 
  1.2             relating to insurance; regulating coverages, fees, 
  1.3             forms, disclosures, reports, and premiums; amending 
  1.4             Minnesota Statutes 2002, sections 60A.14, subdivision 
  1.5             1; 60A.23, subdivision 8; 60A.966; 60A.969; 62A.136; 
  1.6             62A.31, subdivision 1h; 62A.318; 65A.29, subdivision 
  1.7             11; 65B.48, subdivision 3; 72A.20, subdivisions 13, 
  1.8             15; 72A.201, subdivisions 3, 4; 79.56, subdivisions 1, 
  1.9             3; 79.62, subdivision 3; 79A.12, subdivision 2; 
  1.10            176.191, subdivision 3; Minnesota Statutes 2003 
  1.11            Supplement, section 62A.316; proposing coding for new 
  1.12            law in Minnesota Statutes, chapter 79; repealing 
  1.13            Minnesota Statutes 2002, sections 61A.072, subdivision 
  1.14            2; 62E.05, subdivision 2. 
  1.15  BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  1.16     Section 1.  Minnesota Statutes 2002, section 60A.14, 
  1.17  subdivision 1, is amended to read: 
  1.18     Subdivision 1.  [FEES OTHER THAN EXAMINATION FEES.] In 
  1.19  addition to the fees and charges provided for examinations, the 
  1.20  following fees must be paid to the commissioner for deposit in 
  1.21  the general fund: 
  1.22     (a) by township mutual fire insurance companies; 
  1.23     (1) for filing certificate of incorporation $25 and 
  1.24  amendments thereto, $10; 
  1.25     (2) for filing annual statements, $15; 
  1.26     (3) for each annual certificate of authority, $15; 
  1.27     (4) for filing bylaws $25 and amendments thereto, $10; 
  1.28     (b) by other domestic and foreign companies including 
  1.29  fraternals and reciprocal exchanges; 
  1.30     (1) for filing certified copy of certificate of articles of 
  2.1   incorporation, $100; 
  2.2      (2) for filing annual statement, $225; 
  2.3      (3) for filing certified copy of amendment to certificate 
  2.4   or articles of incorporation, $100; 
  2.5      (4) for filing bylaws, $75 or amendments thereto, $75; 
  2.6      (5) for each company's certificate of authority, $575, 
  2.7   annually; 
  2.8      (c) the following general fees apply: 
  2.9      (1) for each certificate, including certified copy of 
  2.10  certificate of authority, renewal, valuation of life policies, 
  2.11  corporate condition or qualification, $25; 
  2.12     (2) for each copy of paper on file in the commissioner's 
  2.13  office 50 cents per page, and $2.50 for certifying the same; 
  2.14     (3) for license to procure insurance in unadmitted foreign 
  2.15  companies, $575; 
  2.16     (4) for valuing the policies of life insurance companies, 
  2.17  one cent per $1,000 of insurance so valued, provided that the 
  2.18  fee shall not exceed $13,000 per year for any company.  The 
  2.19  commissioner may, in lieu of a valuation of the policies of any 
  2.20  foreign life insurance company admitted, or applying for 
  2.21  admission, to do business in this state, accept a certificate of 
  2.22  valuation from the company's own actuary or from the 
  2.23  commissioner of insurance of the state or territory in which the 
  2.24  company is domiciled; 
  2.25     (5) for receiving and filing certificates of policies by 
  2.26  the company's actuary, or by the commissioner of insurance of 
  2.27  any other state or territory, $50; 
  2.28     (6) for each appointment of an agent filed with the 
  2.29  commissioner, $10; 
  2.30     (7) for filing forms and rates, $75 $90 per filing, which 
  2.31  may be paid on a quarterly basis in response to an invoice.  
  2.32  Billing and payment may be made electronically; 
  2.33     (8) for annual renewal of surplus lines insurer license, 
  2.34  $300; 
  2.35     (9) $250 filing fee for a large risk alternative rating 
  2.36  option plan that meets the $250,000 threshold requirement. 
  3.1      The commissioner shall adopt rules to define filings that 
  3.2   are subject to a fee. 
  3.3      Sec. 2.  Minnesota Statutes 2002, section 60A.23, 
  3.4   subdivision 8, is amended to read: 
  3.5      Subd. 8.  [SELF-INSURANCE OR INSURANCE PLAN ADMINISTRATORS 
  3.6   WHO ARE VENDORS OF RISK MANAGEMENT SERVICES.] (1)  [SCOPE.] This 
  3.7   subdivision applies to any vendor of risk management services 
  3.8   and to any entity which administers, for compensation, a 
  3.9   self-insurance or insurance plan.  This subdivision does not 
  3.10  apply (a) to an insurance company authorized to transact 
  3.11  insurance in this state, as defined by section 60A.06, 
  3.12  subdivision 1, clauses (4) and (5); (b) to a service plan 
  3.13  corporation, as defined by section 62C.02, subdivision 6; (c) to 
  3.14  a health maintenance organization, as defined by section 62D.02, 
  3.15  subdivision 4; (d) to an employer directly operating a 
  3.16  self-insurance plan for its employees' benefits; (e) to an 
  3.17  entity which administers a program of health benefits 
  3.18  established pursuant to a collective bargaining agreement 
  3.19  between an employer, or group or association of employers, and a 
  3.20  union or unions; or (f) to an entity which administers a 
  3.21  self-insurance or insurance plan if a licensed Minnesota insurer 
  3.22  is providing insurance to the plan and if the licensed insurer 
  3.23  has appointed the entity administering the plan as one of its 
  3.24  licensed agents within this state. 
  3.25     (2)  [DEFINITIONS.] For purposes of this subdivision the 
  3.26  following terms have the meanings given them. 
  3.27     (a) "Administering a self-insurance or insurance plan" 
  3.28  means (i) processing, reviewing or paying claims, (ii) 
  3.29  establishing or operating funds and accounts, or (iii) otherwise 
  3.30  providing necessary administrative services in connection with 
  3.31  the operation of a self-insurance or insurance plan. 
  3.32     (b) "Employer" means an employer, as defined by section 
  3.33  62E.02, subdivision 2. 
  3.34     (c) "Entity" means any association, corporation, 
  3.35  partnership, sole proprietorship, trust, or other business 
  3.36  entity engaged in or transacting business in this state. 
  4.1      (d) "Self-insurance or insurance plan" means a plan 
  4.2   providing life, medical or hospital care, accident, sickness or 
  4.3   disability insurance for the benefit of employees or members of 
  4.4   an association, or a plan providing liability coverage for any 
  4.5   other risk or hazard, which is or is not directly insured or 
  4.6   provided by a licensed insurer, service plan corporation, or 
  4.7   health maintenance organization. 
  4.8      (e) "Vendor of risk management services" means an entity 
  4.9   providing for compensation actuarial, financial management, 
  4.10  accounting, legal or other services for the purpose of designing 
  4.11  and establishing a self-insurance or insurance plan for an 
  4.12  employer. 
  4.13     (3)  [LICENSE.] No vendor of risk management services or 
  4.14  entity administering a self-insurance or insurance plan may 
  4.15  transact this business in this state unless it is licensed to do 
  4.16  so by the commissioner.  An applicant for a license shall state 
  4.17  in writing the type of activities it seeks authorization to 
  4.18  engage in and the type of services it seeks authorization to 
  4.19  provide.  The license may be granted only when the commissioner 
  4.20  is satisfied that the entity possesses the necessary 
  4.21  organization, background, expertise, and financial integrity to 
  4.22  supply the services sought to be offered.  The commissioner may 
  4.23  issue a license subject to restrictions or limitations upon the 
  4.24  authorization, including the type of services which may be 
  4.25  supplied or the activities which may be engaged in.  The license 
  4.26  fee is $1,000 $1,500 for the initial application and 
  4.27  $1,000 $1,500 for each two-year three-year renewal.  All 
  4.28  licenses are for a period of two three years. 
  4.29     (4)  [REGULATORY RESTRICTIONS; POWERS OF THE COMMISSIONER.] 
  4.30  To assure that self-insurance or insurance plans are financially 
  4.31  solvent, are administered in a fair and equitable fashion, and 
  4.32  are processing claims and paying benefits in a prompt, fair, and 
  4.33  honest manner, vendors of risk management services and entities 
  4.34  administering insurance or self-insurance plans are subject to 
  4.35  the supervision and examination by the commissioner.  Vendors of 
  4.36  risk management services, entities administering insurance or 
  5.1   self-insurance plans, and insurance or self-insurance plans 
  5.2   established or operated by them are subject to the trade 
  5.3   practice requirements of sections 72A.19 to 72A.30.  In lieu of 
  5.4   an unlimited guarantee from a parent corporation for a vendor of 
  5.5   risk management services or an entity administering insurance or 
  5.6   self-insurance plans, the commissioner may accept a surety bond 
  5.7   in a form satisfactory to the commissioner in an amount equal to 
  5.8   120 percent of the total amount of claims handled by the 
  5.9   applicant in the prior year.  If at any time the total amount of 
  5.10  claims handled during a year exceeds the amount upon which the 
  5.11  bond was calculated, the administrator shall immediately notify 
  5.12  the commissioner.  The commissioner may require that the bond be 
  5.13  increased accordingly. 
  5.14     No contract entered into after July 1, 2001, between a 
  5.15  licensed vendor of risk management services and a group 
  5.16  authorized to self-insure for workers' compensation liabilities 
  5.17  under section 79A.03, subdivision 6, may take effect until it 
  5.18  has been filed with the commissioner, and either (1) the 
  5.19  commissioner has approved it or (2) 60 days have elapsed and the 
  5.20  commissioner has not disapproved it as misleading or violative 
  5.21  of public policy. 
  5.22     (5)  [RULEMAKING AUTHORITY.] To carry out the purposes of 
  5.23  this subdivision, the commissioner may adopt rules pursuant to 
  5.24  sections 14.001 to 14.69.  These rules may: 
  5.25     (a) establish reporting requirements for administrators of 
  5.26  insurance or self-insurance plans; 
  5.27     (b) establish standards and guidelines to assure the 
  5.28  adequacy of financing, reinsuring, and administration of 
  5.29  insurance or self-insurance plans; 
  5.30     (c) establish bonding requirements or other provisions 
  5.31  assuring the financial integrity of entities administering 
  5.32  insurance or self-insurance plans; or 
  5.33     (d) establish other reasonable requirements to further the 
  5.34  purposes of this subdivision. 
  5.35     Sec. 3.  Minnesota Statutes 2002, section 60A.966, is 
  5.36  amended to read: 
  6.1      60A.966 [APPROVAL OF VIATICAL SETTLEMENTS CONTRACT FORMS.] 
  6.2      A viatical settlement provider or broker may not use a 
  6.3   viatical settlement contract form in this state unless it has 
  6.4   been filed with and approved by the commissioner.  A viatical 
  6.5   settlement contract form filed with the commissioner is 
  6.6   considered to have been approved if it has not been disapproved 
  6.7   within 60 days of the filing.  The commissioner shall disapprove 
  6.8   a viatical settlement contract form if, in the commissioner's 
  6.9   opinion, the contract or contract provisions are unreasonable, 
  6.10  contrary to the interests of the public, or otherwise misleading 
  6.11  or unfair to the policy owner.  
  6.12     Sec. 4.  Minnesota Statutes 2002, section 60A.969, is 
  6.13  amended to read: 
  6.14     60A.969 [DISCLOSURE.] 
  6.15     A viatical settlement provider or a broker shall disclose 
  6.16  the following information to the viator no later than the 
  6.17  date the viatical settlement contract is signed by all 
  6.18  parties an application is given to the viator: 
  6.19     (1) possible alternatives to viatical settlement contracts 
  6.20  for persons with catastrophic or life threatening illnesses, 
  6.21  including accelerated benefits offered by the issuer of the life 
  6.22  insurance policy; 
  6.23     (2) the fact that some or all of the proceeds of the 
  6.24  viatical settlement may be taxable and that assistance should be 
  6.25  sought from a personal tax advisor; 
  6.26     (3) the fact that the viatical settlement may be subject to 
  6.27  the claims of creditors; 
  6.28     (4) the fact that receipt of a viatical settlement may 
  6.29  adversely affect the recipients' eligibility for Medicaid or 
  6.30  other government benefits or entitlements and that advice should 
  6.31  be obtained from the appropriate agencies; 
  6.32     (5) the policy owner's right to rescind a viatical 
  6.33  settlement contract within 30 days of the date it is executed by 
  6.34  all parties or 15 days of the receipt of the viatical settlement 
  6.35  proceeds by the viator, whichever is less, as provided in 
  6.36  section 60A.970, subdivision 3; and 
  7.1      (6) the date by which the funds will be available to the 
  7.2   viator and the source of the funds. 
  7.3      Sec. 5.  Minnesota Statutes 2002, section 62A.136, is 
  7.4   amended to read: 
  7.5      62A.136 [DENTAL AND VISION PLAN COVERAGE.] 
  7.6      The following provisions do not apply to health plans as 
  7.7   defined in section 62A.011, subdivision 3, clause (6), providing 
  7.8   dental or vision coverage only:  sections 62A.041; 62A.0411; 
  7.9   62A.047; 62A.149; 62A.151; 62A.152; 62A.154; 62A.155; 62A.17, 
  7.10  subdivision 6; 62A.21, subdivision 2b; 62A.26; 62A.28; 62A.285; 
  7.11  62A.30; 62A.304; 62A.3093; and 62E.16. 
  7.12     Sec. 6.  Minnesota Statutes 2002, section 62A.31, 
  7.13  subdivision 1h, is amended to read: 
  7.14     Subd. 1h.  [LIMITATIONS ON DENIALS, CONDITIONS, AND PRICING 
  7.15  OF COVERAGE.] No health carrier issuing Medicare-related 
  7.16  coverage in this state may impose preexisting condition 
  7.17  limitations or otherwise deny or condition the issuance or 
  7.18  effectiveness of any such coverage available for sale in this 
  7.19  state, nor may it discriminate in the pricing of such coverage, 
  7.20  because of the health status, claims experience, receipt of 
  7.21  health care, medical condition, or age of an applicant where an 
  7.22  application for such coverage is submitted prior to or during 
  7.23  the six-month period beginning with the first day of the month 
  7.24  in which an individual first enrolled for benefits under 
  7.25  Medicare Part B.  This subdivision applies to each 
  7.26  Medicare-related coverage offered by a health carrier regardless 
  7.27  of whether the individual has attained the age of 65 years.  If 
  7.28  an individual who is enrolled in Medicare Part B due to 
  7.29  disability status is involuntarily disenrolled due to loss of 
  7.30  disability status, the individual is eligible for another 
  7.31  six-month enrollment period provided under this subdivision 
  7.32  beginning the first day of the month in which the individual 
  7.33  later becomes eligible for and enrolls again in Medicare Part 
  7.34  B.  An individual who is or was previously enrolled in Medicare 
  7.35  Part B due to disability status is eligible for another 
  7.36  six-month enrollment period under this subdivision beginning the 
  8.1   first day of the month in which the individual has attained the 
  8.2   age of 65 years and either maintains enrollment in, or enrolls 
  8.3   again in, Medicare Part B.  If an individual enrolled in 
  8.4   Medicare Part B voluntarily disenrolls from Medicare Part B 
  8.5   because the individual becomes reemployed and is enrolled under 
  8.6   an employee welfare benefit plan, the individual is eligible for 
  8.7   another six-month enrollment period, as provided in this 
  8.8   subdivision, beginning the first day of the month in which the 
  8.9   individual later becomes eligible for and enrolls again in 
  8.10  Medicare Part B. 
  8.11     Sec. 7.  Minnesota Statutes 2003 Supplement, section 
  8.12  62A.316, is amended to read: 
  8.13     62A.316 [BASIC MEDICARE SUPPLEMENT PLAN; COVERAGE.] 
  8.14     (a) The basic Medicare supplement plan must have a level of 
  8.15  coverage that will provide: 
  8.16     (1) coverage for all of the Medicare part A inpatient 
  8.17  hospital coinsurance amounts, and 100 percent of all Medicare 
  8.18  part A eligible expenses for hospitalization not covered by 
  8.19  Medicare, after satisfying the Medicare part A deductible; 
  8.20     (2) coverage for the daily co-payment amount of Medicare 
  8.21  part A eligible expenses for the calendar year incurred for 
  8.22  skilled nursing facility care; 
  8.23     (3) coverage for the coinsurance amount, or in the case of 
  8.24  outpatient department services paid under a prospective payment 
  8.25  system, the co-payment amount, of Medicare eligible expenses 
  8.26  under Medicare part B regardless of hospital confinement, 
  8.27  subject to the Medicare part B deductible amount; 
  8.28     (4) 80 percent of the hospital and medical expenses and 
  8.29  supplies incurred during travel outside the United States as a 
  8.30  result of a medical emergency; 
  8.31     (5) coverage for the reasonable cost of the first three 
  8.32  pints of blood, or equivalent quantities of packed red blood 
  8.33  cells as defined under federal regulations under Medicare parts 
  8.34  A and B, unless replaced in accordance with federal regulations; 
  8.35     (6) 100 percent of the cost of immunizations and routine 
  8.36  screening procedures for cancer screening including mammograms 
  9.1   and pap smears; and 
  9.2      (7) 80 percent of coverage for all physician prescribed 
  9.3   medically appropriate and necessary equipment and supplies used 
  9.4   in the management and treatment of diabetes.  Coverage must 
  9.5   include persons with gestational, type I, or type II diabetes. 
  9.6      (b) Only the following optional benefit riders may be added 
  9.7   to this plan: 
  9.8      (1) coverage for all of the Medicare part A inpatient 
  9.9   hospital deductible amount; 
  9.10     (2) a minimum of 80 percent of eligible medical expenses 
  9.11  and supplies not covered by Medicare part B, not to exceed any 
  9.12  charge limitation established by the Medicare program or state 
  9.13  law; 
  9.14     (3) coverage for all of the Medicare part B annual 
  9.15  deductible; 
  9.16     (4) coverage for at least 50 percent, or the equivalent of 
  9.17  50 percent, of usual and customary prescription drug expenses; 
  9.18     (5) coverage for the following preventive health services: 
  9.19     (i) an annual clinical preventive medical history and 
  9.20  physical examination that may include tests and services from 
  9.21  clause (ii) and patient education to address preventive health 
  9.22  care measures; 
  9.23     (ii) any one or a combination of the following preventive 
  9.24  screening tests or preventive services, the frequency of which 
  9.25  is considered medically appropriate: 
  9.26     (A) fecal occult blood test and/or digital rectal 
  9.27  examination; 
  9.28     (B) dipstick urinalysis for hematuria, bacteriuria, and 
  9.29  proteinuria; 
  9.30     (C) pure tone (air only) hearing screening test, 
  9.31  administered or ordered by a physician; 
  9.32     (D) serum cholesterol screening every five years; 
  9.33     (E) thyroid function test; 
  9.34     (F) diabetes screening; 
  9.35     (iii) any other tests or preventive measures determined 
  9.36  appropriate by the attending physician. 
 10.1      Reimbursement shall be for the actual charges up to 100 
 10.2   percent of the Medicare-approved amount for each service, as if 
 10.3   Medicare were to cover the service as identified in American 
 10.4   Medical Association current procedural terminology (AMA CPT) 
 10.5   codes, to a maximum of $120 annually under this benefit.  This 
 10.6   benefit shall not include payment for a procedure covered by 
 10.7   Medicare; 
 10.8      (6) coverage for services to provide short-term at-home 
 10.9   assistance with activities of daily living for those recovering 
 10.10  from an illness, injury, or surgery: 
 10.11     (i) For purposes of this benefit, the following definitions 
 10.12  apply: 
 10.13     (A) "activities of daily living" include, but are not 
 10.14  limited to, bathing, dressing, personal hygiene, transferring, 
 10.15  eating, ambulating, assistance with drugs that are normally 
 10.16  self-administered, and changing bandages or other dressings; 
 10.17     (B) "care provider" means a duly qualified or licensed home 
 10.18  health aide/homemaker, personal care aid, or nurse provided 
 10.19  through a licensed home health care agency or referred by a 
 10.20  licensed referral agency or licensed nurses registry; 
 10.21     (C) "home" means a place used by the insured as a place of 
 10.22  residence, provided that the place would qualify as a residence 
 10.23  for home health care services covered by Medicare.  A hospital 
 10.24  or skilled nursing facility shall not be considered the 
 10.25  insured's place of residence; 
 10.26     (D) "at-home recovery visit" means the period of a visit 
 10.27  required to provide at-home recovery care, without limit on the 
 10.28  duration of the visit, except each consecutive four hours in a 
 10.29  24-hour period of services provided by a care provider is one 
 10.30  visit; 
 10.31     (ii) Coverage requirements and limitations: 
 10.32     (A) at-home recovery services provided must be primarily 
 10.33  services that assist in activities of daily living; 
 10.34     (B) the insured's attending physician must certify that the 
 10.35  specific type and frequency of at-home recovery services are 
 10.36  necessary because of a condition for which a home care plan of 
 11.1   treatment was approved by Medicare; 
 11.2      (C) coverage is limited to: 
 11.3      (I) no more than the number and type of at-home recovery 
 11.4   visits certified as necessary by the insured's attending 
 11.5   physician.  The total number of at-home recovery visits shall 
 11.6   not exceed the number of Medicare-approved home care visits 
 11.7   under a Medicare-approved home care plan of treatment; 
 11.8      (II) the actual charges for each visit up to a maximum 
 11.9   reimbursement of $40 per visit; 
 11.10     (III) $1,600 $4,000 per calendar year; 
 11.11     (IV) seven visits in any one week; 
 11.12     (V) care furnished on a visiting basis in the insured's 
 11.13  home; 
 11.14     (VI) services provided by a care provider as defined in 
 11.15  this section; 
 11.16     (VII) at-home recovery visits while the insured is covered 
 11.17  under the policy or certificate and not otherwise excluded; 
 11.18     (VIII) at-home recovery visits received during the period 
 11.19  the insured is receiving Medicare-approved home care services or 
 11.20  no more than eight weeks after the service date of the last 
 11.21  Medicare-approved home health care visit; 
 11.22     (iii) Coverage is excluded for: 
 11.23     (A) home care visits paid for by Medicare or other 
 11.24  government programs; and 
 11.25     (B) care provided by family members, unpaid volunteers, or 
 11.26  providers who are not care providers; 
 11.27     (7) coverage for at least 50 percent, or the equivalent of 
 11.28  50 percent, of usual and customary prescription drug expenses to 
 11.29  a maximum of $1,200 paid by the issuer annually under this 
 11.30  benefit.  An issuer of Medicare supplement insurance policies 
 11.31  that elects to offer this benefit rider shall also make 
 11.32  available coverage that contains the rider specified in clause 
 11.33  (4). 
 11.34     Sec. 8.  Minnesota Statutes 2002, section 62A.318, is 
 11.35  amended to read: 
 11.36     62A.318 [MEDICARE SELECT POLICIES AND CERTIFICATES.] 
 12.1      (a) This section applies to Medicare select policies and 
 12.2   certificates, as defined in this section, including those issued 
 12.3   by health maintenance organizations.  No policy or certificate 
 12.4   may be advertised as a Medicare select policy or certificate 
 12.5   unless it meets the requirements of this section. 
 12.6      (b) For the purposes of this section: 
 12.7      (1) "complaint" means any dissatisfaction expressed by an 
 12.8   individual concerning a Medicare select issuer or its network 
 12.9   providers; 
 12.10     (2) "grievance" means dissatisfaction expressed in writing 
 12.11  by an individual insured under a Medicare select policy or 
 12.12  certificate with the administration, claims practices, or 
 12.13  provision of services concerning a Medicare select issuer or its 
 12.14  network providers; 
 12.15     (3) "Medicare select issuer" means an issuer offering, or 
 12.16  seeking to offer, a Medicare select policy or certificate; 
 12.17     (4) "Medicare select policy" or "Medicare select 
 12.18  certificate" means a Medicare supplement policy or certificate 
 12.19  that contains restricted network provisions; 
 12.20     (5) "network provider" means a provider of health care, or 
 12.21  a group of providers of health care, that has entered into a 
 12.22  written agreement with the issuer to provide benefits insured 
 12.23  under a Medicare select policy or certificate; 
 12.24     (6) "restricted network provision" means a provision that 
 12.25  conditions the payment of benefits, in whole or in part, on the 
 12.26  use of network providers; and 
 12.27     (7) "service area" means the geographic area approved by 
 12.28  the commissioner within which an issuer is authorized to offer a 
 12.29  Medicare select policy or certificate. 
 12.30     (c) The commissioner may authorize an issuer to offer a 
 12.31  Medicare select policy or certificate pursuant to this section 
 12.32  and section 4358 of the Omnibus Budget Reconciliation Act (OBRA) 
 12.33  of 1990, Public Law 101-508, if the commissioner finds that the 
 12.34  issuer has satisfied all of the requirements of Minnesota 
 12.35  Statutes. 
 12.36     (d) A Medicare select issuer shall not issue a Medicare 
 13.1   select policy or certificate in this state until its plan of 
 13.2   operation has been approved by the commissioner. 
 13.3      (e) A Medicare select issuer shall file a proposed plan of 
 13.4   operation with the commissioner, in a format prescribed by the 
 13.5   commissioner.  The plan of operation shall contain at least the 
 13.6   following information: 
 13.7      (1) evidence that all covered services that are subject to 
 13.8   restricted network provisions are available and accessible 
 13.9   through network providers, including a demonstration that: 
 13.10     (i) the services can be provided by network providers with 
 13.11  reasonable promptness with respect to geographic location, hours 
 13.12  of operation, and after-hour care.  The hours of operation and 
 13.13  availability of after-hour care shall reflect usual practice in 
 13.14  the local area.  Geographic availability shall reflect the usual 
 13.15  travel times within the community; 
 13.16     (ii) the number of network providers in the service area is 
 13.17  sufficient, with respect to current and expected policyholders, 
 13.18  either: 
 13.19     (A) to deliver adequately all services that are subject to 
 13.20  a restricted network provision; or 
 13.21     (B) to make appropriate referrals; 
 13.22     (iii) there are written agreements with network providers 
 13.23  describing specific responsibilities; 
 13.24     (iv) emergency care is available 24 hours per day and seven 
 13.25  days per week; and 
 13.26     (v) in the case of covered services that are subject to a 
 13.27  restricted network provision and are provided on a prepaid 
 13.28  basis, there are written agreements with network providers 
 13.29  prohibiting the providers from billing or otherwise seeking 
 13.30  reimbursement from or recourse against an individual insured 
 13.31  under a Medicare select policy or certificate.  This section 
 13.32  does not apply to supplemental charges or coinsurance amounts as 
 13.33  stated in the Medicare select policy or certificate; 
 13.34     (2) a statement or map providing a clear description of the 
 13.35  service area; 
 13.36     (3) a description of the grievance procedure to be used; 
 14.1      (4) a description of the quality assurance program, 
 14.2   including: 
 14.3      (i) the formal organizational structure; 
 14.4      (ii) the written criteria for selection, retention, and 
 14.5   removal of network providers; and 
 14.6      (iii) the procedures for evaluating quality of care 
 14.7   provided by network providers, and the process to initiate 
 14.8   corrective action when warranted; 
 14.9      (5) a list and description, by specialty, of the network 
 14.10  providers; 
 14.11     (6) copies of the written information proposed to be used 
 14.12  by the issuer to comply with paragraph (i); and 
 14.13     (7) any other information requested by the commissioner. 
 14.14     (f) A Medicare select issuer shall file proposed changes to 
 14.15  the plan of operation, except for changes to the list of network 
 14.16  providers, with the commissioner before implementing the 
 14.17  changes.  The changes shall be considered approved by the 
 14.18  commissioner after 30 days unless specifically disapproved. 
 14.19     An updated list of network providers shall be filed with 
 14.20  the commissioner at least quarterly. 
 14.21     (g) A Medicare select policy or certificate shall not 
 14.22  restrict payment for covered services provided by nonnetwork 
 14.23  providers if: 
 14.24     (1) the services are for symptoms requiring emergency care 
 14.25  or are immediately required for an unforeseen illness, injury, 
 14.26  or condition; and 
 14.27     (2) it is not reasonable to obtain the services through a 
 14.28  network provider. 
 14.29     (h) A Medicare select policy or certificate shall provide 
 14.30  payment for full coverage under the policy or certificate for 
 14.31  covered services that are not available through network 
 14.32  providers. 
 14.33     (i) A Medicare select issuer shall make full and fair 
 14.34  disclosure in writing of the provisions, restrictions, and 
 14.35  limitations of the Medicare select policy or certificate to each 
 14.36  applicant.  This disclosure must include at least the following: 
 15.1      (1) an outline of coverage sufficient to permit the 
 15.2   applicant to compare the coverage and premiums of the Medicare 
 15.3   select policy or certificate with: 
 15.4      (i) other Medicare supplement policies or certificates 
 15.5   offered by the issuer; and 
 15.6      (ii) other Medicare select policies or certificates; 
 15.7      (2) a description, including address, phone number, and 
 15.8   hours of operation, of the network providers, including primary 
 15.9   care physicians, specialty physicians, hospitals, and other 
 15.10  providers; 
 15.11     (3) a description of the restricted network provisions, 
 15.12  including payments for coinsurance and deductibles when 
 15.13  providers other than network providers are used; 
 15.14     (4) a description of coverage for emergency and urgently 
 15.15  needed care and other out-of-service area coverage; 
 15.16     (5) a description of limitations on referrals to restricted 
 15.17  network providers and to other providers; 
 15.18     (6) a description of the policyholder's rights to purchase 
 15.19  any other Medicare supplement policy or certificate otherwise 
 15.20  offered by the issuer; and 
 15.21     (7) a description of the Medicare select issuer's quality 
 15.22  assurance program and grievance procedure. 
 15.23     (j) Before the sale of a Medicare select policy or 
 15.24  certificate, a Medicare select issuer shall obtain from the 
 15.25  applicant a signed and dated form stating that the applicant has 
 15.26  received the information provided pursuant to paragraph (i) and 
 15.27  that the applicant understands the restrictions of the Medicare 
 15.28  select policy or certificate. 
 15.29     (k) A Medicare select issuer shall have and use procedures 
 15.30  for hearing complaints and resolving written grievances from the 
 15.31  subscribers.  The procedures shall be aimed at mutual agreement 
 15.32  for settlement and may include arbitration procedures.  
 15.33     (1) The grievance procedure must be described in the policy 
 15.34  and certificates and in the outline of coverage. 
 15.35     (2) At the time the policy or certificate is issued, the 
 15.36  issuer shall provide detailed information to the policyholder 
 16.1   describing how a grievance may be registered with the issuer. 
 16.2      (3) Grievances must be considered in a timely manner and 
 16.3   must be transmitted to appropriate decision makers who have 
 16.4   authority to fully investigate the issue and take corrective 
 16.5   action. 
 16.6      (4) If a grievance is found to be valid, corrective action 
 16.7   must be taken promptly. 
 16.8      (5) All concerned parties must be notified about the 
 16.9   results of a grievance. 
 16.10     (6) The issuer shall report no later than March 31 of each 
 16.11  year to the commissioner regarding the grievance procedure.  The 
 16.12  report shall be in a format prescribed by the commissioner and 
 16.13  shall contain the number of grievances filed in the past year 
 16.14  and a summary of the subject, nature, and resolution of the 
 16.15  grievances. 
 16.16     (l) At the time of initial purchase, a Medicare select 
 16.17  issuer shall make available to each applicant for a Medicare 
 16.18  select policy or certificate the opportunity to purchase a 
 16.19  Medicare supplement policy or certificate otherwise offered by 
 16.20  the issuer. 
 16.21     (m)(1) At the request of an individual insured under a 
 16.22  Medicare select policy or certificate, a Medicare select issuer 
 16.23  shall make available to the individual insured the opportunity 
 16.24  to purchase a Medicare supplement policy or certificate offered 
 16.25  by the issuer that has comparable or lesser benefits and that 
 16.26  does not contain a restricted network provision.  The issuer 
 16.27  shall make the policies or certificates available without 
 16.28  requiring evidence of insurability after the Medicare supplement 
 16.29  policy or certificate has been in force for six months.  If the 
 16.30  issuer does not have available for sale a policy or certificate 
 16.31  without restrictive network provisions, the issuer shall provide 
 16.32  enrollment information for the Minnesota comprehensive health 
 16.33  association Medicare supplement plans. 
 16.34     (2) For the purposes of this paragraph, a Medicare 
 16.35  supplement policy or certificate will be considered to have 
 16.36  comparable or lesser benefits unless it contains one or more 
 17.1   significant benefits not included in the Medicare select policy 
 17.2   or certificate being replaced.  For the purposes of this 
 17.3   paragraph, a significant benefit means coverage for the Medicare 
 17.4   Part A deductible, coverage for prescription drugs, coverage for 
 17.5   at-home recovery services, or coverage for part B excess charges.
 17.6      (n) Medicare select policies and certificates shall provide 
 17.7   for continuation of coverage if the secretary of health and 
 17.8   human services determines that Medicare select policies and 
 17.9   certificates issued pursuant to this section should be 
 17.10  discontinued due to either the failure of the Medicare select 
 17.11  program to be reauthorized under law or its substantial 
 17.12  amendment. 
 17.13     (1) Each Medicare select issuer shall make available to 
 17.14  each individual insured under a Medicare select policy or 
 17.15  certificate the opportunity to purchase a Medicare supplement 
 17.16  policy or certificate offered by the issuer that has comparable 
 17.17  or lesser benefits and that does not contain a restricted 
 17.18  network provision.  The issuer shall make the policies and 
 17.19  certificates available without requiring evidence of 
 17.20  insurability. 
 17.21     (2) For the purposes of this paragraph, a Medicare 
 17.22  supplement policy or certificate will be considered to have 
 17.23  comparable or lesser benefits unless it contains one or more 
 17.24  significant benefits not included in the Medicare select policy 
 17.25  or certificate being replaced.  For the purposes of this 
 17.26  paragraph, a significant benefit means coverage for the Medicare 
 17.27  Part A deductible, coverage for prescription drugs, coverage for 
 17.28  at-home recovery services, or coverage for part B excess charges.
 17.29     (o) A Medicare select issuer shall comply with reasonable 
 17.30  requests for data made by state or federal agencies, including 
 17.31  the United States Department of Health and Human Services, for 
 17.32  the purpose of evaluating the Medicare select program. 
 17.33     (p) Medicare select policies and certificates under this 
 17.34  section shall be regulated and approved by the Department of 
 17.35  Commerce. 
 17.36     (q) Medicare select policies and certificates must be 
 18.1   either a basic plan or an extended basic plan.  Before a 
 18.2   Medicare select policy or certificate is sold or issued in this 
 18.3   state, the applicant must be provided with an explanation of 
 18.4   coverage for both a Medicare select basic and a Medicare select 
 18.5   extended basic policy or certificate and must be provided with 
 18.6   the opportunity of purchasing either a Medicare select basic or 
 18.7   a Medicare select extended basic policy.  The basic plan may 
 18.8   also include any of the optional benefit riders authorized by 
 18.9   section 62A.316.  Preventive care provided by Medicare select 
 18.10  policies or certificates must be provided as set forth in 
 18.11  section 62A.315 or 62A.316, except that the benefits are as 
 18.12  defined in chapter 62D. 
 18.13     Sec. 9.  Minnesota Statutes 2002, section 65A.29, 
 18.14  subdivision 11, is amended to read: 
 18.15     Subd. 11.  [NONRENEWAL.] Every insurer shall establish a 
 18.16  plan that sets out the minimum number and amount of claims 
 18.17  during an experience period that may result in a 
 18.18  nonrenewal.  For purposes of the plan, the insurer may not 
 18.19  consider the following as claims: 
 18.20     (1) the insured's inquiry about coverage for a hypothetical 
 18.21  or potential claim; 
 18.22     (2) notification by the insured of a potential claim where 
 18.23  the insured does not ultimately file the claim; or 
 18.24     (3) a claim where the insurer does not ultimately pay out 
 18.25  any funds. 
 18.26     No homeowner's insurance policy may be nonrenewed based on 
 18.27  the insured's loss experience unless the insurer has sent a 
 18.28  written notice that any future losses may result in nonrenewal 
 18.29  due to loss experience. 
 18.30     Any nonrenewal of a homeowner's insurance policy must, at a 
 18.31  minimum, comply with the requirements of subdivision 8 and the 
 18.32  rules adopted by the commissioner. 
 18.33     Sec. 10.  Minnesota Statutes 2002, section 65B.48, 
 18.34  subdivision 3, is amended to read: 
 18.35     Subd. 3.  Self-insurance, subject to approval of the 
 18.36  commissioner, is effected by filing with the commissioner in 
 19.1   satisfactory form: 
 19.2      (1) a continuing undertaking by the owner or other 
 19.3   appropriate person to pay tort liabilities or basic economic 
 19.4   loss benefits, or both, and to perform all other obligations 
 19.5   imposed by sections 65B.41 to 65B.71; 
 19.6      (2) evidence that appropriate provision exists for prompt 
 19.7   administration of all claims, benefits, and obligations provided 
 19.8   by sections 65B.41 to 65B.71; 
 19.9      (3) evidence that reliable financial arrangements, 
 19.10  deposits, or commitments exist providing assurance, 
 19.11  substantially equivalent to that afforded by a policy of 
 19.12  insurance complying with sections 65B.41 to 65B.71, for payment 
 19.13  of tort liabilities, basic economic loss benefits, and all other 
 19.14  obligations imposed by sections 65B.41 to 65B.71; and 
 19.15     (4) a nonrefundable initial application fee 
 19.16  of $1,500 $2,500 and an annual a renewal fee of $400 $1,200 
 19.17  for political subdivisions and $500 $1,500 for nonpolitical 
 19.18  entities every three years.  
 19.19     Sec. 11.  Minnesota Statutes 2002, section 72A.20, 
 19.20  subdivision 13, is amended to read: 
 19.21     Subd. 13.  [REFUSAL TO RENEW.] Refusing to renew, declining 
 19.22  to offer or write, or charging differential rates for an 
 19.23  equivalent amount of homeowner's insurance coverage, as defined 
 19.24  by section 65A.27, for property located in a town or statutory 
 19.25  or home rule charter city, in which the insurer offers to sell 
 19.26  or writes homeowner's insurance, solely because:  
 19.27     (a) of the geographic area in which the property is 
 19.28  located; 
 19.29     (b) of the age of the primary structure sought to be 
 19.30  insured; 
 19.31     (c) the insured or prospective insured was denied coverage
 19.32  of the property by another insurer, whether by cancellation, 
 19.33  nonrenewal or declination to offer coverage, for a reason other 
 19.34  than those specified in section 65A.01, subdivision 3a, clauses 
 19.35  (a) to (e); or 
 19.36     (d) the property of the insured or prospective insured has
 20.1   been insured under the Minnesota FAIR Plan Act, shall constitute 
 20.2   an unfair method of competition and an unfair and deceptive act 
 20.3   or practice; or 
 20.4      (e) the insured has inquired about coverage for a 
 20.5   hypothetical or potential claim, or has notified the insurer of 
 20.6   a potential claim where the insured does not ultimately file the 
 20.7   claim, or has made a claim where the insurer does not ultimately 
 20.8   pay out any funds.  
 20.9      This subdivision prohibits an insurer from filing or 
 20.10  charging different rates for different zip code areas within the 
 20.11  same town or statutory or home rule charter city. 
 20.12     This subdivision shall not prohibit the insurer from 
 20.13  applying underwriting or rating standards which the insurer 
 20.14  applies generally in all other locations in the state and which 
 20.15  are not specifically prohibited by clauses (a) to (d) (e).  Such 
 20.16  underwriting or rating standards shall specifically include but 
 20.17  not be limited to standards based upon the proximity of the 
 20.18  insured property to an extraordinary hazard or based upon the 
 20.19  quality or availability of fire protection services or based 
 20.20  upon the density or concentration of the insurer's risks.  
 20.21  Clause (b) shall not prohibit the use of rating standards based 
 20.22  upon the age of the insured structure's plumbing, electrical, 
 20.23  heating or cooling system or other part of the structure, the 
 20.24  age of which affects the risk of loss.  Any insurer's failure to 
 20.25  comply with section 65A.29, subdivisions 2 to 4, either (1) by 
 20.26  failing to give an insured or applicant the required notice or 
 20.27  statement or (2) by failing to state specifically a bona fide 
 20.28  underwriting or other reason for the refusal to write shall 
 20.29  create a presumption that the insurer has violated this 
 20.30  subdivision.  
 20.31     Sec. 12.  Minnesota Statutes 2002, section 72A.20, 
 20.32  subdivision 15, is amended to read: 
 20.33     Subd. 15.  [PRACTICES NOT HELD TO BE DISCRIMINATION OR 
 20.34  REBATES.] Nothing in subdivision 8, 9, or 10, or in section 
 20.35  72A.12, subdivisions 3 and 4, shall be construed as including 
 20.36  within the definition of discrimination or rebates any of the 
 21.1   following practices: 
 21.2      (1) in the case of any contract of life insurance or 
 21.3   annuity, paying bonuses to policyholders or otherwise abating 
 21.4   their premiums in whole or in part out of surplus accumulated 
 21.5   from nonparticipating insurance, provided that any bonuses or 
 21.6   abatement of premiums shall be fair and equitable to 
 21.7   policyholders and for the best interests of the company and its 
 21.8   policyholders; 
 21.9      (2) in the case of life insurance policies issued on the 
 21.10  industrial debit plan, making allowance, to policyholders who 
 21.11  have continuously for a specified period made premium payments 
 21.12  directly to an office of the insurer, in an amount which fairly 
 21.13  represents the saving in collection expense; 
 21.14     (3) readjustment of the rate of premium for a group 
 21.15  insurance policy based on the loss or expense experienced 
 21.16  thereunder, at the end of the first or any subsequent policy 
 21.17  year of insurance thereunder, which may be made retroactive only 
 21.18  for such policy year; 
 21.19     (4) in the case of an individual or group health insurance 
 21.20  policy, the payment of differing amounts of reimbursement to 
 21.21  insureds who elect to receive health care goods or services from 
 21.22  providers designated by the insurer, provided that each insurer 
 21.23  shall on or before August 1 of each year file with the 
 21.24  commissioner summary data regarding the financial reimbursement 
 21.25  offered to providers so designated.  
 21.26     Any insurer which proposes to offer an arrangement 
 21.27  authorized under this clause shall disclose prior to its initial 
 21.28  offering and on or before August 1 of each year thereafter as a 
 21.29  supplement to its annual statement submitted to the commissioner 
 21.30  pursuant to section 60A.13, subdivision 1, the following 
 21.31  information:  
 21.32     (a) the name which the arrangement intends to use and its 
 21.33  business address; 
 21.34     (b) the name, address, and nature of any separate 
 21.35  organization which administers the arrangement on the behalf of 
 21.36  the insurers; and 
 22.1      (c) the names and addresses of all providers designated by 
 22.2   the insurer under this clause and the terms of the agreements 
 22.3   with designated health care providers.  
 22.4      The commissioner shall maintain a record of arrangements 
 22.5   proposed under this clause, including a record of any complaints 
 22.6   submitted relative to the arrangements. 
 22.7      If the commissioner requests copies of contracts with a 
 22.8   provider under this clause and the provider requests a 
 22.9   determination, all information contained in the contracts that 
 22.10  the commissioner determines may place the provider or health 
 22.11  care plan at a competitive disadvantage is nonpublic data.  
 22.12     Sec. 13.  Minnesota Statutes 2002, section 72A.201, 
 22.13  subdivision 3, is amended to read: 
 22.14     Subd. 3.  [DEFINITIONS.] For the purposes of this section, 
 22.15  the following terms have the meanings given them.  
 22.16     (1) [ACCIDENT AND SICKNESS INSURANCE.] "Accident and 
 22.17  sickness insurance" means any policy covering the kind of 
 22.18  insurance described in section 60A.06, subdivision 1, clause 
 22.19  (5)(a). 
 22.20     (2) [ADJUSTER OR ADJUSTERS.] "Adjuster" or "adjusters" is 
 22.21  as defined in section 72B.02.  
 22.22     (2) (3) [AGENT.] "Agent" means insurance agents or 
 22.23  insurance agencies licensed pursuant to sections 60K.30 to 
 22.24  60K.56, and representatives of these agents or agencies.  
 22.25     (3) (4) [CLAIM.] "Claim" means a request or demand made 
 22.26  with an insurer for the payment of funds or the provision of 
 22.27  services under the terms of any policy, certificate, contract of 
 22.28  insurance, binder, or other contracts of temporary insurance. 
 22.29  The term does not include a claim under a health insurance 
 22.30  policy made by a participating provider with an insurer in 
 22.31  accordance with the participating provider's service agreement 
 22.32  with the insurer which has been filed with the commissioner of 
 22.33  commerce prior to its use.  
 22.34     (4) (5) [CLAIM SETTLEMENT.] "Claim settlement" means all 
 22.35  activities of an insurer related directly or indirectly to the 
 22.36  determination of the extent of liabilities due or potentially 
 23.1   due under coverages afforded by the policy, and which result in 
 23.2   claim payment, claim acceptance, compromise, or other 
 23.3   disposition.  
 23.4      (5) (6) [CLAIMANT.] "Claimant" means any individual, 
 23.5   corporation, association, partnership, or other legal entity 
 23.6   asserting a claim against any individual, corporation, 
 23.7   association, partnership, or other legal entity which is insured 
 23.8   under an insurance policy or insurance contract of an insurer.  
 23.9      (6) (7) [COMPLAINT.] "Complaint" means a communication 
 23.10  primarily expressing a grievance.  
 23.11     (7) (8) [INSURANCE POLICY.] "Insurance policy" means any 
 23.12  evidence of coverage issued by an insurer including all 
 23.13  policies, contracts, certificates, riders, binders, and 
 23.14  endorsements which provide or describe coverage.  The term 
 23.15  includes any contract issuing coverage under a self-insurance 
 23.16  plan, group self-insurance plan, or joint self-insurance 
 23.17  employee health plans.  
 23.18     (8) (9) [INSURED.] "Insured" means an individual, 
 23.19  corporation, association, partnership, or other legal entity 
 23.20  asserting a right to payment under their insurance policy or 
 23.21  insurance contract arising out of the occurrence of the 
 23.22  contingency or loss covered by the policy or contract.  The term 
 23.23  does not apply to a person who acquires rights under a mortgage. 
 23.24     (9) (10) [INSURER.] "Insurer" includes any individual, 
 23.25  corporation, association, partnership, reciprocal exchange, 
 23.26  Lloyds, fraternal benefits society, self-insurer, surplus line 
 23.27  insurer, self-insurance administrator, and nonprofit service 
 23.28  plans under the jurisdiction of the Department of Commerce.  
 23.29     (10) (11) [INVESTIGATION.] "Investigation" means a 
 23.30  reasonable procedure adopted by an insurer to determine whether 
 23.31  to accept or reject a claim.  
 23.32     (11) (12) [NOTIFICATION OF CLAIM.] "Notification of claim" 
 23.33  means any communication to an insurer by a claimant or an 
 23.34  insured which reasonably apprises the insurer of a claim brought 
 23.35  under an insurance contract or policy issued by the insurer. 
 23.36  Notification of claim to an agent of the insurer is notice to 
 24.1   the insurer.  
 24.2      (12) (13) [PROOF OF LOSS.] "Proof of loss" means the 
 24.3   necessary documentation required from the insured to establish 
 24.4   entitlement to payment under a policy.  
 24.5      (13) (14) [SELF-INSURANCE ADMINISTRATOR.] "Self-insurance 
 24.6   administrator" means any vendor of risk management services or 
 24.7   entities administering self-insurance plans, licensed pursuant 
 24.8   to section 60A.23, subdivision 8.  
 24.9      (14) (15) [SELF-INSURED OR SELF-INSURER.] "Self-insured" or 
 24.10  "self-insurer" means any entity authorized pursuant to section 
 24.11  65B.48, subdivision 3; chapter 62H; section 176.181, subdivision 
 24.12  2; Laws of Minnesota 1983, chapter 290, section 171; section 
 24.13  471.617; or section 471.981 and includes any entity which, for a 
 24.14  fee, employs the services of vendors of risk management services 
 24.15  in the administration of a self-insurance plan as defined by 
 24.16  section 60A.23, subdivision 8, clause (2), subclauses (a) and 
 24.17  (d). 
 24.18     Sec. 14.  Minnesota Statutes 2002, section 72A.201, 
 24.19  subdivision 4, is amended to read: 
 24.20     Subd. 4.  [STANDARDS FOR CLAIM FILING AND HANDLING.] The 
 24.21  following acts by an insurer, an adjuster, a self-insured, or a 
 24.22  self-insurance administrator constitute unfair settlement 
 24.23  practices:  
 24.24     (1) except for claims made under a health insurance policy, 
 24.25  after receiving notification of claim from an insured or a 
 24.26  claimant, failing to acknowledge receipt of the notification of 
 24.27  the claim within ten business days, and failing to promptly 
 24.28  provide all necessary claim forms and instructions to process 
 24.29  the claim, unless the claim is settled within ten business 
 24.30  days.  The acknowledgment must include the telephone number of 
 24.31  the company representative who can assist the insured or the 
 24.32  claimant in providing information and assistance that is 
 24.33  reasonable so that the insured or claimant can comply with the 
 24.34  policy conditions and the insurer's reasonable requirements.  If 
 24.35  an acknowledgment is made by means other than writing, an 
 24.36  appropriate notation of the acknowledgment must be made in the 
 25.1   claim file of the insurer and dated.  An appropriate notation 
 25.2   must include at least the following information where the 
 25.3   acknowledgment is by telephone or oral contact:  
 25.4      (i) the telephone number called, if any; 
 25.5      (ii) the name of the person making the telephone call or 
 25.6   oral contact; 
 25.7      (iii) the name of the person who actually received the 
 25.8   telephone call or oral contact; 
 25.9      (iv) the time of the telephone call or oral contact; and 
 25.10     (v) the date of the telephone call or oral contact; 
 25.11     (2) failing to reply, within ten business days of receipt, 
 25.12  to all other communications about a claim from an insured or a 
 25.13  claimant that reasonably indicate a response is requested or 
 25.14  needed; 
 25.15     (3) unless provided otherwise by law or in the policy, 
 25.16  failing to complete its investigation and inform the insured or 
 25.17  claimant of acceptance or denial of a claim within 30 business 
 25.18  days after receipt of notification of claim unless the 
 25.19  investigation cannot be reasonably completed within that time. 
 25.20  In the event that the investigation cannot reasonably be 
 25.21  completed within that time, the insurer shall notify the insured 
 25.22  or claimant within the time period of the reasons why the 
 25.23  investigation is not complete and the expected date the 
 25.24  investigation will be complete.  For claims made under a health 
 25.25  policy of accident and sickness insurance, the notification of 
 25.26  claim must be in writing; 
 25.27     (4) where evidence of suspected fraud is present, the 
 25.28  requirement to disclose their reasons for failure to complete 
 25.29  the investigation within the time period set forth in clause (3) 
 25.30  need not be specific.  The insurer must make this evidence 
 25.31  available to the Department of Commerce if requested; 
 25.32     (5) failing to notify an insured who has made a 
 25.33  notification of claim of all available benefits or coverages 
 25.34  which the insured may be eligible to receive under the terms of 
 25.35  a policy and of the documentation which the insured must supply 
 25.36  in order to ascertain eligibility; 
 26.1      (6) unless otherwise provided by law or in the policy, 
 26.2   requiring an insured to give written notice of loss or proof of 
 26.3   loss within a specified time, and thereafter seeking to relieve 
 26.4   the insurer of its obligations if the time limit is not complied 
 26.5   with, unless the failure to comply with the time limit 
 26.6   prejudices the insurer's rights and then only if the insurer 
 26.7   gave prior notice to the insured of the potential prejudice; 
 26.8      (7) advising an insured or a claimant not to obtain the 
 26.9   services of an attorney or an adjuster, or representing that 
 26.10  payment will be delayed if an attorney or an adjuster is 
 26.11  retained by the insured or the claimant; 
 26.12     (8) failing to advise in writing an insured or claimant who 
 26.13  has filed a notification of claim known to be unresolved, and 
 26.14  who has not retained an attorney, of the expiration of a statute 
 26.15  of limitations at least 60 days prior to that expiration.  For 
 26.16  the purposes of this clause, any claim on which the insurer has 
 26.17  received no communication from the insured or claimant for a 
 26.18  period of two years preceding the expiration of the applicable 
 26.19  statute of limitations shall not be considered to be known to be 
 26.20  unresolved and notice need not be sent pursuant to this clause; 
 26.21     (9) demanding information which would not affect the 
 26.22  settlement of the claim; 
 26.23     (10) unless expressly permitted by law or the policy, 
 26.24  refusing to settle a claim of an insured on the basis that the 
 26.25  responsibility should be assumed by others; 
 26.26     (11) failing, within 60 business days after receipt of a 
 26.27  properly executed proof of loss, to advise the insured of the 
 26.28  acceptance or denial of the claim by the insurer.  No insurer 
 26.29  shall deny a claim on the grounds of a specific policy 
 26.30  provision, condition, or exclusion unless reference to the 
 26.31  provision, condition, or exclusion is included in the denial. 
 26.32  The denial must be given to the insured in writing with a copy 
 26.33  filed in the claim file; 
 26.34     (12) denying or reducing a claim on the basis of an 
 26.35  application which was altered or falsified by the agent or 
 26.36  insurer without the knowledge of the insured; 
 27.1      (13) failing to notify the insured of the existence of the 
 27.2   additional living expense coverage when an insured under a 
 27.3   homeowners policy sustains a loss by reason of a covered 
 27.4   occurrence and the damage to the dwelling is such that it is not 
 27.5   habitable; 
 27.6      (14) failing to inform an insured or a claimant that the 
 27.7   insurer will pay for an estimate of repair if the insurer 
 27.8   requested the estimate and the insured or claimant had 
 27.9   previously submitted two estimates of repair.  
 27.10     Sec. 15.  [79.097] [PREMIUM SURCHARGE RATE CALCULATION.] 
 27.11     On or before July 1 of each year, the commissioner shall 
 27.12  establish the special compensation fund premium surcharge rate 
 27.13  to be used by all insurers for policies with an effective date 
 27.14  on or after January 1.  The premium surcharge rate must be 
 27.15  sufficient to generate revenue necessary to satisfy the pro rata 
 27.16  share of the assessment obligations attributable to insured 
 27.17  employers that must be paid on the assessment. 
 27.18     Sec. 16.  Minnesota Statutes 2002, section 79.56, 
 27.19  subdivision 1, is amended to read: 
 27.20     Subdivision 1.  [PREFILING OF RATES.] (a) Each insurer 
 27.21  shall file with the commissioner a complete copy of its rates 
 27.22  and rating plan, and all changes and amendments thereto, and 
 27.23  such supporting data and information that the commissioner may 
 27.24  by rule require, at least 60 days prior to its effective date.  
 27.25  The commissioner shall advise an insurer within 30 days of the 
 27.26  filing if its submission is not accompanied with such supporting 
 27.27  data and information that the commissioner by rule may require.  
 27.28  The commissioner may extend the filing review period and 
 27.29  effective date for an additional 30 days if an insurer, after 
 27.30  having been advised of what supporting data and information is 
 27.31  necessary to complete its filing, does not provide such 
 27.32  information within 15 days of having been so notified.  If any 
 27.33  rate or rating plan filing or amendment thereto is not 
 27.34  disapproved by the commissioner within the filing review period, 
 27.35  the insurer may implement it.  For the period August 1, 1995, to 
 27.36  December 31, 1995, the filing shall be made at least 90 days 
 28.1   prior to the effective date and the department shall advise an 
 28.2   insurer within 60 days of such filing if the filing is 
 28.3   insufficient under this section. 
 28.4      (b) A rating plan or rates are not subject to the 
 28.5   requirements of paragraph (a), where the insurer files a 
 28.6   certification verifying that it will use the mutually agreed 
 28.7   upon rating plan or rates only to write a specific employer that 
 28.8   generates $250,000 in annual written workers' compensation 
 28.9   premiums before the application of any large deductible rating 
 28.10  plan.  The certification must be refiled upon each renewal of 
 28.11  the employer's policy.  The $250,000 threshold includes premiums 
 28.12  generated in any state.  The designation and certification must 
 28.13  be submitted in substantially the following form: 
 28.14  Name and address of insurer:................................. 
 28.15  Name and address of insured employer:........................ 
 28.16  Policy period:............................................... 
 28.17  I certify that the employer named above generates $250,000 or 
 28.18  more in annual countrywide written workers' compensation 
 28.19  premiums, and that the calculation of this threshold is based on 
 28.20  the rates and rating plans that have been approved by the 
 28.21  appropriate state regulatory authority.  The filing of this 
 28.22  certification authorizes the use of this rate or rating plan 
 28.23  only for the named employer. 
 28.24  Name of responsible officer:................................. 
 28.25  Title:....................................................... 
 28.26  Signature:................................................... 
 28.27     Sec. 17.  Minnesota Statutes 2002, section 79.56, 
 28.28  subdivision 3, is amended to read: 
 28.29     Subd. 3.  [PENALTIES.] (a) Any insurer using a rate or a 
 28.30  rating plan which has not been filed under subdivision 1 shall 
 28.31  be subject to a fine of up to $100 for each day the failure to 
 28.32  file continues.  The commissioner may, after a hearing on the 
 28.33  record, find that the failure is willful.  A willful failure to 
 28.34  meet filing requirements shall be punishable by a fine of up to 
 28.35  $500 for each day during which a willful failure continues.  
 28.36  These penalties shall be in addition to any other penalties 
 29.1   provided by law.  
 29.2      (b) Notwithstanding this subdivision, an employer that 
 29.3   generates $250,000 in annual written workers' compensation 
 29.4   premium under the rates and rating plan of an insurer before the 
 29.5   application of any large deductible rating plans, may be written 
 29.6   by that insurer using rates or rating plans that are not subject 
 29.7   to disapproval but which have been filed.  For the purposes of 
 29.8   this paragraph, written workers' compensation premiums generated 
 29.9   from states other than Minnesota are included in calculating the 
 29.10  $250,000 threshold for large risk alternative rating option 
 29.11  plans.  
 29.12     Sec. 18.  Minnesota Statutes 2002, section 79.62, 
 29.13  subdivision 3, is amended to read: 
 29.14     Subd. 3.  [ISSUANCE.] The commissioner, upon finding that 
 29.15  the applicant organization is qualified to provide the services 
 29.16  required and proposed, or has contracted with a licensed data 
 29.17  service organization to purchase these services which are 
 29.18  required by this chapter but are not provided directly by the 
 29.19  applicant, and that all requirements of law are met, shall issue 
 29.20  a license.  Each license is subject to annual renewal effective 
 29.21  June 30.  Each new or renewal license application must be 
 29.22  accompanied by a fee of $50 $1,000.  
 29.23     Sec. 19.  Minnesota Statutes 2002, section 79A.12, 
 29.24  subdivision 2, is amended to read: 
 29.25     Subd. 2.  [ASSESSMENT.] The security fund may assess each 
 29.26  of its members a pro rata share of the funding necessary to 
 29.27  carry out its obligation and the purposes of this chapter.  
 29.28  Total annual assessments in any calendar year shall not exceed 
 29.29  ten percent of the workers' compensation benefits paid under 
 29.30  sections 176.101 and 176.111 during the previous paid indemnity 
 29.31  losses, as defined in section 176.129, made by the self-insured 
 29.32  employer during the preceding calendar year.  The annual 
 29.33  assessment calculation shall not include supplementary benefits 
 29.34  paid which will be reimbursed by the special compensation fund.  
 29.35  Funds obtained by assessments pursuant to this subdivision may 
 29.36  only be used for the purposes of this chapter.  The trustees 
 30.1   shall certify to the commissioner the collection and receipt of 
 30.2   all money from assessments, noting any delinquencies.  The 
 30.3   trustees shall take any action deemed appropriate to collect any 
 30.4   delinquent assessments. 
 30.5      Sec. 20.  Minnesota Statutes 2002, section 176.191, 
 30.6   subdivision 3, is amended to read: 
 30.7      Subd. 3.  [INSURER PAYMENT.] If a dispute exists as to 
 30.8   whether an employee's injury is compensable under this chapter 
 30.9   and the employee is otherwise covered by an insurer or entity 
 30.10  pursuant to chapters 62A, 62C and, 62D, 62E, 62R, and 62T, that 
 30.11  insurer or entity shall pay any medical costs incurred by the 
 30.12  employee for the injury up to the limits of the applicable 
 30.13  coverage and shall make any disability payments otherwise 
 30.14  payable by that insurer or entity in the absence of or in 
 30.15  addition to workers' compensation liability.  If the injury is 
 30.16  subsequently determined to be compensable pursuant to this 
 30.17  chapter, the workers' compensation insurer shall be ordered to 
 30.18  reimburse the insurer or entity that made the payments for all 
 30.19  payments made under this subdivision by the insurer or entity, 
 30.20  including interest at a rate of 12 percent a year.  If a payment 
 30.21  pursuant to this subdivision exceeds the reasonable value as 
 30.22  permitted by sections 176.135 and 176.136, the provider shall 
 30.23  reimburse the workers' compensation insurer for all the excess 
 30.24  as provided by rules promulgated by the commissioner. 
 30.25     Sec. 21.  [REPEALER.] 
 30.26     Minnesota Statutes 2002, sections 61A.072, subdivision 2; 
 30.27  and 62E.05, subdivision 2, are repealed. 
 30.28     Sec. 22.  [EFFECTIVE DATE.] 
 30.29     Section 15 is effective for assessments due after January 
 30.30  1, 2003.