HF 3398

1st Engrossment - 86th Legislature (2009 - 2010) Posted on 03/17/2010 12:46pm

A bill for an act
relating to insurance; providing former employees the option to bypass
continuation coverage and obtain low-cost immediate conversion health
insurance coverage from their former employer's insurer; amending Minnesota
Statutes 2008, section 62A.17, by adding a subdivision.

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

Section 1.

Minnesota Statutes 2008, section 62A.17, is amended by adding a
subdivision to read:

new text begin Subd. 7. new text end

new text begin Direct conversion to conversion policy. new text end

new text begin (a) In addition to other coverage
required to be available under this section, a health plan that provides group health
coverage to an employer must contain a provision which provides to every covered
employee eligible for continuation health coverage under subdivision 1 the right to obtain
from the health carrier a direct conversion policy under this subdivision, without first
enrolling in and completing continuation coverage. The employer, or health carrier on
behalf of the employer, must provide the former employee with written notice of the
former employee's rights under this subdivision at the same time the employer provides
notice of the former employee's rights under subdivisions 1 to 5. Coverage under this
subdivision must be offered to any person to whom continuation coverage must be offered
under federal law or Minnesota law.
new text end

new text begin (b) The individual direct conversion policies available to a former employee,
including dependent coverage at the option of the former employee, must be at least the
following options:
new text end

new text begin (1) annual deductible of $1,000 per individual, 80 percent coverage above the
deductible subject to an annual $10,000 limit on out-of-pocket costs, and further subject
to a $1,000,000 lifetime maximum benefit per individual;
new text end

new text begin (2) health savings account compatible coverage, annual deductible of $2,000 per
individual subject to a $4,000 annual family deductible, 80 percent coverage above the
deductible subject to annual out-of-pocket limits of $5,000 per individual and $10,000 per
family, and further subject to a $1,000,000 lifetime maximum per individual; and
new text end

new text begin (3) health savings account compatible coverage, annual deductible $5,950 per
individual and $11,900 per family, with 100 percent coverage above those deductibles,
subject to a $1,000,000 lifetime maximum per individual.
new text end

new text begin (c) The insurer must not consider the insurer's loss experience under policies issued
under this subdivision in determining the premium or any other feature of the employer's
group coverage.
new text end

new text begin (d) A former employee is not eligible for direct conversion coverage under
this subdivision if the former employee has enrolled in continuation coverage under
subdivisions 1 to 5. An election to receive coverage under this subdivision must be made
no later than the deadline for electing continuation coverage under subdivisions 1 to 5.
new text end

new text begin (e) A person enrolled in direct conversion coverage under this subdivision may
continue to renew that coverage until the person becomes eligible for group health
coverage as an employee or dependent or 18 months, whichever is earlier. After 18
months, the former employee is eligible for Minnesota Comprehensive Health Association
coverage without a preexisting condition limitation.
new text end

new text begin (f) Coverage under this subdivision must be available on a guaranteed-issue basis,
following the HIPAA preexisting condition limitation definition.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective January 1, 2011, and applies to
terminations of or layoffs from employment that begin on or after that date.
new text end