HF 3709

as introduced - 86th Legislature (2009 - 2010) Posted on 03/18/2010 09:28am

A bill for an act
relating to health; making conforming and other changes related to federal
health care reform; providing funding for health care subsidies; establishing
accountable care organizations; establishing a publicly administered health
plan; expanding eligibility for medical assistance; repealing the MinnesotaCare
program and related taxes; amending Minnesota Statutes 2008, sections 16A.724,
by adding a subdivision; 62U.05; 256.01, by adding subdivisions; 256B.055,
by adding a subdivision; 256B.056, subdivisions 3, 4, by adding subdivisions;
256B.0754, by adding a subdivision; 256L.04, subdivision 1; 295.52, by adding
a subdivision; proposing coding for new law in Minnesota Statutes, chapter 62U;
repealing Minnesota Statutes 2008, sections 62E.08; 62E.09; 62E.091; 62E.10;
62E.101; 62E.11; 62E.12; 62E.13; 62E.14; 62E.141; 62E.15; 62E.16; 62E.18;
62E.19; 256L.01, subdivisions 1, 1a, 2, 3, 3a, 5; 256L.02, subdivisions 1, 2, 3;
256L.03, subdivisions 1, 1a, 2, 3, 3a, 4, 6; 256L.04, subdivisions 1, 1a, 2, 2a,
7, 7a, 7b, 8, 9, 10, 12, 13; 256L.05, subdivisions 1a, 1b, 2, 3, 3a, 3b, 3c, 4, 5;
256L.06, subdivision 3; 256L.07, subdivisions 1, 2, 4, 5, 6, 7; 256L.10; 256L.11,
subdivisions 2, 2a, 3, 4, 5, 6, 7; 256L.12; 256L.15; 256L.17, subdivisions 1,
2, 4, 7; 256L.18; 256L.22; 256L.24; 256L.26; 256L.28; 295.52, subdivisions
1, 1a, 2, 3, 4, 4a, 5, 6, 7; 295.53, subdivisions 1, 2, 3, 4a; 295.54; 295.55;
295.57, subdivisions 1, 2, 3, 4; 295.58; 295.582; 295.59; 297I.05, subdivision 5;
Minnesota Statutes 2009 Supplement, sections 256L.01, subdivision 4a; 256L.03,
subdivision 5; 256L.04, subdivision 10a; 256L.05, subdivision 1; 256L.11,
subdivision 1; 256L.17, subdivisions 3, 5; 295.56; 295.57, subdivision 5.

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

ARTICLE 1

STATE HEALTH CARE PROGRAMS

Section 1.

Minnesota Statutes 2008, section 16A.724, is amended by adding a
subdivision to read:

new text begin Subd. 5. new text end

new text begin Health care subsidies. new text end

new text begin Effective January 1, 2012, revenue in the health
care access fund that the commissioner of management and budget determines is not
needed to fund the MinnesotaCare program, due to the elimination of coverage for adults
without children, is available to the commissioner of human services to provide health
care subsidies to individuals and households with gross family incomes greater than
133-1/3 percent but not exceeding 400 percent of the federal poverty guidelines based on
family size, using the affordability standard established in section 62U.13.
new text end

Sec. 2.

Minnesota Statutes 2008, section 62U.05, is amended to read:

62U.05 PROVIDER PRICING FOR BASKETS OF CARE new text begin ; ACCOUNTABLE
CARE ORGANIZATIONS new text end .

Subdivision 1.

Establishment of definitions.

(a) By July 1, 2009, the commissioner
of health shall establish uniform definitions for baskets of care beginning with a minimum
of seven baskets of care. In selecting health conditions for which baskets of care should
be defined, the commissioner shall consider coronary artery and heart disease, diabetes,
asthma, and depression. In selecting health conditions, the commissioner shall also
consider the prevalence of the health conditions, the cost of treating the health conditions,
and the potential for innovations to reduce cost and improve quality.

(b) The commissioner shall convene one or more work groups to assist in
establishing these definitions. Each work group shall include members appointed by
statewide associations representing relevant health care providers and health plan
companies, and organizations that work to improve health care quality in Minnesota.

(c) To the extent possible, the baskets of care must incorporate a patient-directed,
decision-making support model.

new text begin (d) By January 1, 2011, the commissioner shall establish uniform definitions for the
total cost of providing all necessary services to a patient through an accountable care
organization meeting the standards specified in Public Law Number 111-XXX, and shall
develop a standard method and format for accountable care organizations to use for
submitting package prices for the total cost of care. This method shall be published in the
State Register and must be made available to all providers.
new text end

Subd. 2.

Package prices.

(a) Beginning January 1, 2010, health care providers may
establish package prices for the baskets of care defined under subdivision 1. new text begin By July 1,
2011, accountable care organizations may establish package prices for the total cost of
care defined under subdivision 1.
new text end

(b) Beginning January 1, 2010, no health care provider or group of providers that
has established a package price for a basket of care under this section new text begin , and beginning
July 1, 2011, no accountable care organization that has established a package price for
the total cost of care under this section, new text end shall vary the payment amount that the provider
new text begin or organization new text end accepts as full payment for a health care service based upon the identity of
the payer, upon a contractual relationship with a payer, upon the identity of the patient,
or upon whether the patient has coverage through a group purchaser. This paragraph
applies only to health care services provided to Minnesota residents or to non-Minnesota
residents who obtain health insurance through a Minnesota employer. This paragraph does
not apply to services paid for by Medicare, state public health care programs through
fee-for-service or prepaid arrangements, workers' compensation, or no-fault automobile
insurance. This paragraph does not affect the right of a provider to provide charity care
or care for a reduced price due to financial hardship of the patient or due to the patient
being a relative or friend of the provider.

Subd. 3.

Quality measurements for baskets of care.

(a) The commissioner shall
establish quality measurements for the defined baskets of care by December 31, 2009. new text begin
The commissioner shall establish quality measures for the total cost of care for services
delivered through an accountable care organization by June 30, 2011. new text end The commissioner
may contract with an organization that works to improve health care quality to make
recommendations about the use of existing measures or establishing new measures where
no measures currently exist.

(b) Beginning July 1, 2010, the commissioner or the commissioner's designee shall
publish comparative price and quality information on the baskets of care in a manner
that is easily accessible and understandable to the public, as this information becomes
available. new text begin Beginning January 1, 2012, the commissioner or the commissioner's designee
shall publish comparative price and quality information on the total cost of care for
services delivered through an accountable care organization in a manner that is easily
accessible and understandable to the public, as this information becomes available.
new text end

Sec. 3.

Minnesota Statutes 2008, section 256.01, is amended by adding a subdivision
to read:

new text begin Subd. 30. new text end

new text begin Regional payment reform. new text end

new text begin The commissioner may enter into
agreements with other states to establish, by January 1, 2012, a regional payment reform
system to reimburse physician groups, integrated delivery systems, and accountable care
organizations that provide services to Medicare enrollees. The regional payment reform
system may use alternative payment systems that provide financial incentives for efficient,
high-quality care. The system may also modify the standard Medicare benefit set. The
commissioner, in cooperation with participating states, shall seek all federal waivers and
approvals necessary to implement the payment reform system.
new text end

Sec. 4.

Minnesota Statutes 2008, section 256.01, is amended by adding a subdivision
to read:

new text begin Subd. 31. new text end

new text begin Public option. new text end

new text begin The commissioner of human services, by January 1, 2012,
shall develop and offer a publicly administered health plan that meets the requirements
of Public Law Number 111-XXX and is offered through the Minnesota health insurance
exchange established under section 62U.11. The commissioner shall administer the health
plan using the infrastructure and procedures that the commissioner uses to administer the
prepaid medical assistance program under section 256B.69.
new text end

Sec. 5.

Minnesota Statutes 2008, section 256B.055, is amended by adding a
subdivision to read:

new text begin Subd. 15. new text end

new text begin Adults without children. new text end

new text begin Medical assistance may be paid for a person
who is over age 21 and under age 65, who is not pregnant, and who is not described in
subdivisions 4, 7, or another subdivision of this section.
new text end

Sec. 6.

Minnesota Statutes 2008, section 256B.056, is amended by adding a
subdivision to read:

new text begin Subd. 1e. new text end

new text begin Modified gross income. new text end

new text begin Effective July 1, 2014, the commissioner
shall calculate income eligibility based on modified gross income for medical assistance
applicants and enrollees for whom the use of modified gross income is required under
Public Law Number 111-XXX.
new text end

Sec. 7.

Minnesota Statutes 2008, section 256B.056, subdivision 3, is amended to read:

Subd. 3.

Asset limitations for individuals deleted text begin and families deleted text end .

new text begin (a) new text end To be eligible for
medical assistance, a person must not individually own more than $3,000 in assets, or if a
member of a household with two family members, husband and wife, or parent and child,
the household must not own more than $6,000 in assets, plus $200 for each additional
legal dependent. In addition to these maximum amounts, an eligible individual or family
may accrue interest on these amounts, but they must be reduced to the maximum at the
time of an eligibility redetermination. The accumulation of the clothing and personal
needs allowance according to section 256B.35 must also be reduced to the maximum at
the time of the eligibility redetermination. The value of assets that are not considered in
determining eligibility for medical assistance is the value of those assets excluded under
the supplemental security income program for aged, blind, and disabled persons, with
the following exceptions:

(1) household goods and personal effects are not considered;

(2) capital and operating assets of a trade or business that the local agency determines
are necessary to the person's ability to earn an income are not considered;

(3) motor vehicles are excluded to the same extent excluded by the supplemental
security income program;

(4) assets designated as burial expenses are excluded to the same extent excluded by
the supplemental security income program. Burial expenses funded by annuity contracts
or life insurance policies must irrevocably designate the individual's estate as contingent
beneficiary to the extent proceeds are not used for payment of selected burial expenses; and

(5) effective upon federal approval, for a person who no longer qualifies as an
employed person with a disability due to loss of earnings, assets allowed while eligible
for medical assistance under section 256B.057, subdivision 9, are not considered for 12
months, beginning with the first month of ineligibility as an employed person with a
disability, to the extent that the person's total assets remain within the allowed limits of
section 256B.057, subdivision 9, paragraph (c).

new text begin (b) No asset limit shall apply for persons eligible under section 256B.055,
subdivisions 3a and 15.
new text end

Sec. 8.

Minnesota Statutes 2008, section 256B.056, is amended by adding a
subdivision to read:

new text begin Subd. 3f. new text end

new text begin Net income standard. new text end

new text begin Effective July 1, 2014, the commissioner shall use
a net income standard, without any asset test or without any income disregards except
those used to determine eligibility for long-term care services and supports, for medical
assistance applicants and enrollees for whom the use of a net income standard is required
under Public Law Number 111-XXX.
new text end

Sec. 9.

Minnesota Statutes 2008, section 256B.056, subdivision 4, is amended to read:

Subd. 4.

Income.

(a) To be eligible for medical assistance, a person eligible under
section 256B.055, subdivisions 7, 7a, and 12, may have income up to 100 percent of
the federal poverty guidelines. Effective January 1, 2000, and each successive January,
recipients of supplemental security income may have an income up to the supplemental
security income standard in effect on that date.

(b) To be eligible for medical assistance, families and children may have an income
up to 133-1/3 percent of the AFDC income standard in effect under the July 16, 1996,
AFDC state plan. Effective July 1, 2000, the base AFDC standard in effect on July 16,
1996, shall be increased by three percent.

(c) Effective July 1, 2002, to be eligible for medical assistance, families and children
may have an income up to 100 percent of the federal poverty guidelines for the family size. new text begin
Effective July 1, 2011, to be eligible for medical assistance, families and children may
have an income up to 133-1/3 percent of the federal poverty guidelines for the family size.
new text end

(d) In computing income to determine eligibility of persons under paragraphs (a)
to (c) new text begin , and (d), new text end who are not residents of long-term care facilities, the commissioner shall
disregard increases in income as required by Public Law Numbers 94-566, section 503;
99-272; and 99-509. Veterans aid and attendance benefits and Veterans Administration
unusual medical expense payments are considered income to the recipient.

new text begin (e) Effective July 1, 2011, to be eligible for medical assistance, a person eligible
under section 256B.055, subdivision 15, may have income up to 133-1/3 percent of the
federal poverty guidelines for the family size.
new text end

Sec. 10.

Minnesota Statutes 2008, section 256B.0754, is amended by adding a
subdivision to read:

new text begin Subd. 3. new text end

new text begin Accountable care organizations. new text end

new text begin By July 1, 2011, the commissioner of
human services shall deliver services to enrollees in state health care programs through
accountable care organizations, and shall provide incentive payments to accountable care
organizations that meet or exceed annual quality and performance targets. Accountable
care organizations and incentive payments must meet the standards specified in Public
Law Number 111-XXX.
new text end

Sec. 11.

Minnesota Statutes 2008, section 256L.04, subdivision 1, is amended to read:

Subdivision 1.

Families with children.

(a) Families with children with family
income equal to or less than 275 percent of the federal poverty guidelines for the
applicable family size shall be eligible for MinnesotaCare according to this section. All
other provisions of sections 256L.01 to 256L.18, including the insurance-related barriers
to enrollment under section 256L.07, shall apply unless otherwise specified.

(b) Parents who enroll in the MinnesotaCare program must also enroll their children,
if the children are eligible. Children may be enrolled separately without enrollment by
parents. However, if one parent in the household enrolls, both parents must enroll, unless
other insurance is available. If one child from a family is enrolled, all children must
be enrolled, unless other insurance is available. If one spouse in a household enrolls,
the other spouse in the household must also enroll, unless other insurance is available.
Families cannot choose to enroll only certain uninsured members.

(c) Beginning October 1, 2003, the dependent sibling definition no longer applies
to the MinnesotaCare program. These persons are no longer counted in the parental
household and may apply as a separate household.

(d) Beginning July 1, 2003, or upon federal approval, whichever is later, parents are
not eligible for MinnesotaCare if their gross income exceeds $57,500.

(e) Children formerly enrolled in medical assistance and automatically deemed
eligible for MinnesotaCare according to section 256B.057, subdivision 2c, are exempt
from the requirements of this section until renewal.

new text begin (f) Beginning July 1, 2012, adults are not eligible for MinnesotaCare and eligibility
under the program is limited to children.
new text end

Sec. 12.

Minnesota Statutes 2008, section 295.52, is amended by adding a subdivision
to read:

new text begin Subd. 8. new text end

new text begin Reduction in tax rate. new text end

new text begin Effective October 1, 2013, the tax rate specified in
subdivisions 1, 1a, 2, and 3, is reduced to ...... percent of gross revenue.
new text end

Sec. 13. new text begin REPEALER.
new text end

new text begin Subdivision 1. new text end

new text begin MinnesotaCare adults with no children. new text end

new text begin Minnesota Statutes 2008,
section 256L.04, subdivision 7, new text end new text begin is repealed effective January 1, 2012.
new text end

new text begin Subd. 2. new text end

new text begin MinnesotaCare program. new text end

new text begin Minnesota Statutes 2008, sections 256L.01,
subdivisions 1, 1a, 2, 3, 3a, and 5; 256L.02, subdivisions 1, 2, and 3; 256L.03, subdivisions
1, 1a, 2, 3, 3a, 4, and 6; 256L.04, subdivisions 1, 1a, 2, 2a, 7, 7a, 7b, 8, 9, 10, 12, and 13;
256L.05, subdivisions 1a, 1b, 2, 3, 3a, 3b, 3c, 4, and 5; 256L.06, subdivision 3; 256L.07,
subdivisions 1, 2, 4, 5, 6, and 7; 256L.10; 256L.11, subdivisions 2, 2a, 3, 4, 5, 6, and 7;
256L.12; 256L.15; 256L.17, subdivisions 1, 2, 4, and 7; 256L.18; 256L.22; 256L.24;
256L.26; and 256L.28, new text end new text begin are repealed effective October 1, 2019, or upon the sunset of any
maintenance of effort requirement for children's Medicaid eligibility established by Public
Law Number 111-XXX, whichever is later.
new text end

new text begin Minnesota Statutes 2009 Supplement, sections 256L.01, subdivision 4a; 256L.03,
subdivision 5; 256L.04, subdivision 10a; 256L.05, subdivision 1; 256L.11, subdivision
1; and 256L.17, subdivisions 3 and 5, new text end new text begin are repealed effective October 1, 2019, or upon
the sunset of any maintenance of effort requirement for children's Medicaid eligibility
established by Public Law Number 111-XXX, whichever is later.
new text end

new text begin Subd. 3. new text end

new text begin MinnesotaCare taxes. new text end

new text begin Minnesota Statutes 2008, sections 295.52,
subdivisions 1, 1a, 2, 3, 4, 4a, 5, 6, and 7; 295.53, subdivisions 1, 2, 3, and 4a; 295.54;
295.55; 295.57, subdivisions 1, 2, 3, and 4; 295.58; 295.582; 295.59; and 297I.05,
subdivision 5, new text end new text begin are repealed effective October 1, 2019, or upon the sunset of any
maintenance of effort requirement for children's Medicaid eligibility established by Public
Law Number 111-XXX, whichever is later.
new text end

new text begin Minnesota Statutes 2009 Supplement, sections 295.56; and 295.57, subdivision
5, new text end new text begin are repealed effective October 1, 2019, or upon the sunset of any maintenance of
effort requirement for children's Medicaid eligibility established by Public Law Number
111-XXX, whichever is later.
new text end

ARTICLE 2

PRIVATE SECTOR HEALTH INSURANCE REFORM

Section 1.

new text begin [62U.11] MINNESOTA HEALTH INSURANCE EXCHANGE.
new text end

new text begin Subdivision 1. new text end

new text begin Title; citation. new text end

new text begin This section may be cited as the "Minnesota Health
Insurance Exchange."
new text end

new text begin Subd. 2. new text end

new text begin Creation; tax exemption. new text end

new text begin (a) The Minnesota Health Insurance Exchange
is created for the limited purpose of providing individuals with greater access, choice,
portability, and affordability of health insurance products.
new text end

new text begin (b) The Minnesota Health Insurance Exchange is created as an unincorporated
association and shall promptly incorporate as a nonprofit corporation under chapter 317A
and apply for qualification under section 501(c) of the Internal Revenue Code.
new text end

new text begin (c) The exchange must comply with all federal laws regarding health insurance
exchanges.
new text end

new text begin Subd. 3. new text end

new text begin Definitions. new text end

new text begin For purposes of this section, the following terms have the
meanings given them.
new text end

new text begin (a) "Board" means the Board of Directors of the Minnesota Health Insurance
Exchange under subdivision 13.
new text end

new text begin (b) "Commissioner" means:
new text end

new text begin (1) the commissioner of commerce for health plan companies subject to the
jurisdiction of the Department of Commerce;
new text end

new text begin (2) the commissioner of health for health plan companies subject to the jurisdiction
of the Department of Health; or
new text end

new text begin (3) either commissioner's designated representative.
new text end

new text begin (c) "HIPAA" means the Health Insurance Portability and Accountability Act of 1996.
new text end

new text begin (d) "Individual market health plan" means a health plan as defined in section
62A.011, that is designed for sale in the individual market and that may cover either an
individual or an individual and the individual's dependents.
new text end

new text begin (e) "Small employer" means a small employer as defined in section 62L.02,
subdivision 26.
new text end

new text begin (f) "Small employer health benefit plan" means a health benefit plan as defined in
section 62L.02, subdivision 15.
new text end

new text begin Subd. 4. new text end

new text begin Health plan company and health plan participation and availability.
new text end

new text begin (a) Only individual market health plans and small employer health benefit plans offered by
a health plan company licensed to issue health plans in Minnesota may be made available
for purchase through the exchange.
new text end

new text begin (b) Each health plan made available by a health plan company through the exchange
must meet the essential benefit set and design requirements provided under section
62U.08, in addition to requirements for qualifying coverage under federal law.
new text end

new text begin (c) Any health plan company that issues health plans in the individual or small
employer market in this state must offer through the exchange at least one health plan that
meets the benefit set and design established under section 62U.08.
new text end

new text begin (d) Health plans offered through the Minnesota Comprehensive Health Association
as defined in section 62E.10 must be available for sale through the exchange as determined
by the Minnesota Comprehensive Health Association.
new text end

new text begin (e) Health plans offered through the MinnesotaCare program must be available
through the exchange to individuals and families who meet the eligibility requirements
for MinnesotaCare, as determined by the commissioner of human services, and who pay
premiums through an employer Section 125 Plan.
new text end

new text begin (f) Nothing in this section restricts the sale of individual market health plans and
small employer health benefit plans outside of the exchange. The requirements applicable
to issuance, renewal, cancellation, and pricing of coverage are the same for health plans
purchased inside and outside the exchange.
new text end

new text begin Subd. 5. new text end

new text begin Comparison of health plans. new text end

new text begin The exchange shall help consumers
understand and compare the standardized health plan options established under section
62U.08. Within each standardized plan grouping, the exchange shall provide easy ways
for consumers to select among the offerings by comparing quality ratings, searching for
a particular provider in its network, or by cost factors. This information must be made
available via the Internet as well as by toll-free telephone assistance and written materials.
new text end

new text begin Subd. 6. new text end

new text begin Individual participation and eligibility. new text end

new text begin (a) Individuals are eligible to
purchase health plans directly through the exchange or through an employer Section
125 Plan under section 62U.07.
new text end

new text begin (b) Individuals are eligible to purchase individual market health plans through the
exchange by meeting one or more of the following qualifications:
new text end

new text begin (1) the individual is a Minnesota resident, meaning the individual is physically
residing on a permanent basis in a place in this state that is the person's principal residence
and from which the person is absent only for temporary purposes;
new text end

new text begin (2) the individual is a student attending an institution outside of Minnesota and
maintains Minnesota residency;
new text end

new text begin (3) the individual is not a Minnesota resident but is employed by an employer
physically located within the state and the individual's employer is required to offer a
Section 125 Plan under section 62U.07; or
new text end

new text begin (4) the individual is a dependent, as defined in section 62L.02, of another individual
who is eligible to participate in the exchange.
new text end

new text begin (c) A self-employed individual, including a partner of a partnership, a member of
a limited liability company, or other owner of a business, who may not be eligible to
participate in a Section 125 Plan, may obtain coverage through the exchange either as an
individual under this paragraph or as an employee covered under a small employer health
benefit plan if permitted under chapter 62L.
new text end

new text begin Subd. 7. new text end

new text begin Small employer participation and eligibility. new text end

new text begin Small employers, as
defined in section 62L.02, may purchase small employer health benefit plans through
the exchange.
new text end

new text begin Subd. 8. new text end

new text begin Responsibilities of exchange. new text end

new text begin The exchange may serve as a coordinating
entity for enrollment and collection and transfer of premium payments for health plans
sold to individuals and small employers through the exchange. The exchange must be
responsible for the following functions:
new text end

new text begin (1) publicizing the exchange including, but not limited to, its functions, eligibility
rules, and enrollment procedures;
new text end

new text begin (2) providing assistance to employers to establish Section 125 Plans under section
62U.07;
new text end

new text begin (3) providing education and assistance to employers to help them understand the
requirements of Section 125 Plans and compliance with applicable regulations;
new text end

new text begin (4) creating a system to allow individuals to compare and enroll in health plans
offered through the exchange, including a system of comparative rating of health plans
and benefit sets;
new text end

new text begin (5) creating a system to collect and transmit to the applicable health plan companies
all premium payments made by individuals and small employers, including developing
mechanisms to receive and process automatic payroll deductions for individuals who
purchase coverage through employer Section 125 Plans;
new text end

new text begin (6) for participating employers, billing the employer for the premiums payable by
the employer for a small employer health benefit plan;
new text end

new text begin (7) for individuals purchasing individual market health plans through a Section 125
Plan, billing the individual's employer for premiums payable by the employee, provided
that the employer is not liable for payment except from payroll deductions for that purpose;
new text end

new text begin (8) providing information on public insurance programs to individuals who may
qualify for these programs, and provide application assistance if needed on applying
for these programs;
new text end

new text begin (9) establishing a mechanism with the Department of Human Services to transfer
premiums paid by Minnesota health care program enrollees from Section 125 Plans;
new text end

new text begin (10) establishing procedures to account for all funds received and disbursed by
the exchange; and
new text end

new text begin (11) making available to the public, within 90 days after the end of each fiscal year, a
report of an independent audit of the exchange's accounts.
new text end

new text begin Subd. 9. new text end

new text begin State not liable. new text end

new text begin The state is not liable for the actions of the exchange.
new text end

new text begin Subd. 10. new text end

new text begin Powers of exchange. new text end

new text begin The exchange shall have the power to:
new text end

new text begin (1) contract with insurance producers licensed in accident and health insurance
under chapter 60K and vendors to perform one or more of the functions in subdivision 8;
new text end

new text begin (2) contract with employers to collect premiums for small employer health benefit
plans and for individual market health plans purchased through a Section 125 Plan;
new text end

new text begin (3) establish and assess fees on health plan premiums of small employer health
benefit plans and individual market health plans to fund the cost of administering the
exchange;
new text end

new text begin (4) seek and directly receive grant funding from government agencies or private
philanthropic organizations, other than those connected with Minnesota-based nonprofit
health providers or health plan companies, to defray the costs of operating the exchange;
new text end

new text begin (5) establish and administer rules and procedures governing the operations of the
exchange;
new text end

new text begin (6) establish one or more service centers within Minnesota;
new text end

new text begin (7) sue or be sued or otherwise take any necessary or proper legal action;
new text end

new text begin (8) establish bank accounts and borrow money; and
new text end

new text begin (9) enter into agreements with the commissioners of commerce, health, human
services, revenue, employment and economic development, and other state agencies as
necessary for the exchange to implement the provisions of this section.
new text end

new text begin Subd. 11. new text end

new text begin Dispute resolution. new text end

new text begin The exchange shall establish procedures for
resolving disputes with respect to the eligibility of an individual to participate in the
exchange. The exchange shall not have the authority or responsibility to intervene in or
resolve disputes between an individual and a health plan or health plan company. If the
exchange receives complaints involving such disputes from individuals participating in
the exchange, the exchange shall inform the individual about the right to make such
complaints to the commissioner to be resolved according to sections 62Q.68 to 62Q.73.
new text end

new text begin Subd. 12. new text end

new text begin Governance. new text end

new text begin The exchange shall be governed by a board of directors
with 11 members. The board shall convene on or before July 1, 2011, after the initial board
members have been selected. The initial board membership consists of the following:
new text end

new text begin (1) the commissioner of commerce;
new text end

new text begin (2) the commissioner of human services;
new text end

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

new text begin (4) eight members with knowledge and experience related to health insurance
and health insurance markets, appointed to serve three-year terms as follows: two
nonlegislators appointed by the Subcommittee on Committees of the Committee on Rules
and Administration of the senate; two nonlegislators appointed by the speaker of the
house; and four members appointed by the governor.
new text end

new text begin Subd. 13. new text end

new text begin Subsequent board membership. new text end

new text begin (a) Effective July 1, 2012, ongoing
membership of the exchange consists of the following:
new text end

new text begin (1) the commissioner of commerce;
new text end

new text begin (2) the commissioner of human services;
new text end

new text begin (3) the commissioner of health;
new text end

new text begin (4) two members appointed as follows: one nonlegislator appointed by the
Subcommittee on Committees of the Committee on Rules and Administration of the senate
and one nonlegislator appointed by the speaker of the house to serve two-year terms.
These appointed members are eligible to be reappointed for one additional term; and
new text end

new text begin (5) four members elected by the membership of the exchange, of which two are
elected to serve a two-year term and two are elected to serve a three-year term.
new text end

new text begin (b) Elected members may serve more than one term. At least one of the elected
members must represent a small employer and at least one member must be a person who
purchases an individual market health plan through the exchange.
new text end

new text begin Subd. 14. new text end

new text begin Operations of board. new text end

new text begin Officers of the board of directors are elected by
members of the board and serve one-year terms. Six members of the board constitute a
quorum, and the affirmative vote of six members of the board is necessary and sufficient
for any action taken by the board. Board members serve without pay, but are reimbursed
for actual expenses incurred in the performance of their duties. Board meetings must be
open to the public, except as specified in the bylaws of the exchange.
new text end

new text begin Subd. 15. new text end

new text begin Operations of exchange. new text end

new text begin The board of directors shall appoint an
exchange director who shall:
new text end

new text begin (1) be a full-time employee of the exchange;
new text end

new text begin (2) administer all of the activities and contracts of the exchange; and
new text end

new text begin (3) hire and supervise the staff of the exchange.
new text end

new text begin Subd. 16. new text end

new text begin Investment of assets. new text end

new text begin The exchange must certify to the State Board of
Investment that a portion of the assets of the exchange, in the judgment of the exchange
director, are not required for immediate use. Investment earnings on assets transferred to
the State Board of Investment under this subdivision must be maintained in an account
in the state treasury. Money in the account may be spent, as appropriated by law, for
purposes related to assisting individuals in paying health insurance premiums and for
making health insurance products more affordable.
new text end

new text begin Subd. 17. new text end

new text begin Audit. new text end

new text begin The legislative auditor must audit the exchange, as provided in
sections 3.971 and 3.972.
new text end

new text begin Subd. 18. new text end

new text begin Insurance producers. new text end

new text begin An individual has the right to choose any
insurance producer licensed in accident and health insurance under chapter 60K to assist
the individual in purchasing an individual market health plan through the exchange. When
a producer licensed in accident and health insurance under chapter 60K enrolls an eligible
individual in the exchange, the health plan company chosen by the individual may pay the
producer a commission.
new text end

new text begin Subd. 19. new text end

new text begin Implementation. new text end

new text begin Health plan coverage through the exchange begins on
January 1, 2012. The exchange must be operational to assist employers and individuals by
July 1, 2011, and be prepared for enrollment by January 1, 2012.
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. 2.

new text begin [62U.12] INTERSTATE COMPACTS.
new text end

new text begin (a) The commissioner of commerce, in consultation with the commissioner of
health, shall participate in discussions with the insurance regulators of other states about
the possibility of entering into one or more interstate compacts to permit sale of health
coverage across state lines, as authorized by federal law.
new text end

new text begin (b) The commissioner may enter into a compact on behalf of the state only when
authorized by state law to enter into the specific compact.
new text end

Sec. 3.

new text begin [62U.13] UNIVERSAL COVERAGE; INDIVIDUAL MANDATE.
new text end

new text begin Subdivision 1. new text end

new text begin Individual mandate. new text end

new text begin Each resident of this state shall obtain and
maintain continuous qualifying health coverage beginning January 1, 2012. A parent,
guardian, or other person responsible for financial support of a minor or incapacitated adult
is responsible for obtaining and maintaining that coverage for the minor or incapacitated
adult.
new text end

new text begin Subd. 2. new text end

new text begin Qualifying coverage. new text end

new text begin For purposes of this section, "qualifying coverage"
has the meaning given under federal law.
new text end

new text begin Subd. 3. new text end

new text begin Satisfaction of individual mandate. new text end

new text begin Subdivision 1 may be complied with
qualifying coverage provided through individual or group coverage in the private sector
insurance market through: (1) self-funded employer or union-based group coverage; (2)
coverage provided by or through a local, state, or federal government program; or (3)
other qualifying coverage approved by the commissioner of revenue.
new text end

new text begin Subd. 4. new text end

new text begin Guaranteed issue; individual market. new text end

new text begin Effective July 1, 2012, all private
sector individual qualifying coverage marketed or sold in this state must be available on a
guaranteed issue basis with no preexisting condition limitations or exclusions.
new text end

new text begin Subd. 5. new text end

new text begin Community rating. new text end

new text begin Effective July 1, 2012, all qualifying coverage
offered, issued, sold, or renewed in this state must have a premium rate that does not
vary based on health status, age, gender, occupation, or any other factor other than the
number of persons covered by the policy.
new text end

new text begin Subd. 6. new text end

new text begin Enforcement. new text end

new text begin (a) The commissioner of revenue shall enforce subdivision
1 and shall impose a penalty of $....... per month for each violation or other amount
specified in federal law. The commissioner of revenue has authority to determine whether
a violation has occurred, subject to appeal in a contested case hearing under chapter 14.
new text end

new text begin (b) The commissioner of commerce or commissioner of health, whichever is the
regulator of the type of health plan company involved, shall enforce subdivisions 2 to 5.
new text end

new text begin Subd. 7. new text end

new text begin Transition for Minnesota Comprehensive Health Association enrollees.
new text end

new text begin The Minnesota Health Insurance Exchange shall, effective January 1, 2012, automatically
enroll all persons who were enrolled as of December 31, 2011, in the Minnesota
Comprehensive Health Association, into individual qualifying coverage through the
exchange. The exchange shall enroll the person into exchange-sponsored coverage as
similar as possible to the coverage the person had through the Minnesota Comprehensive
Health Association. The person may in the following six months switch to any other
coverage available through the exchange with no penalty.
new text end

Sec. 4. new text begin REVISOR'S INSTRUCTION.
new text end

new text begin The revisor of statutes shall editorially remove from Minnesota Statutes and
Minnesota Rules all references to the Minnesota Comprehensive Health Association,
effective January 1, 2012.
new text end

Sec. 5. new text begin REPEALER; MINNESOTA COMPREHENSIVE HEALTH
ASSOCIATION.
new text end

new text begin Minnesota Statutes 2008, sections 62E.08; 62E.09; 62E.091; 62E.10; 62E.101;
62E.11; 62E.12; 62E.13; 62E.14; 62E.141; 62E.15; 62E.16; 62E.18; and 62E.19, new text end new text begin are
repealed effective January 1, 2012.
new text end