SF 1

as introduced - 90th Legislature (2017 - 2018) Posted on 01/11/2017 09:25am

A bill for an act
relating to health care coverage; providing a temporary program to help pay for
health insurance premiums; modifying requirements for health maintenance
organizations; modifying provisions governing health insurance; requiring reports;
appropriating money; amending Minnesota Statutes 2016, sections 60A.08,
subdivision 15; 60A.235, subdivision 3; 60A.236; 62D.02, subdivision 4; 62D.03,
subdivision 1; 62D.05, subdivision 1; 62D.06, subdivision 1; 62D.19; 62E.02,
subdivision 3; 62L.12, subdivision 2; proposing coding for new law in Minnesota
Statutes, chapter 62Q; repealing Minnesota Statutes 2016, sections 62D.12,
subdivision 9; 62K.11.

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

ARTICLE 1

PREMIUM ASSISTANCE

Section 1. new text begin PREMIUM ASSISTANCE PROGRAM ESTABLISHED.
new text end

new text begin The commissioner of Minnesota Management and Budget, in consultation with the
commissioner of commerce and the commissioner of revenue, shall establish and administer
a premium assistance program to help eligible individuals pay expenses for qualified health
coverage in 2017.
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 DEFINITIONS.
new text end

new text begin Subdivision 1. new text end

new text begin Scope. new text end

new text begin For purposes of sections 1 to 5, the following terms have the
meanings given, unless the context clearly indicates otherwise.
new text end

new text begin Subd. 2. new text end

new text begin Commissioner. new text end

new text begin "Commissioner" means the commissioner of Minnesota
Management and Budget.
new text end

new text begin Subd. 3. new text end

new text begin Eligible individual. new text end

new text begin "Eligible individual" means an individual who:
new text end

new text begin (1) is a resident of Minnesota;
new text end

new text begin (2) purchased qualified health coverage for calendar year 2017;
new text end

new text begin (3) meets the income eligibility requirements under section 3, subdivision 3;
new text end

new text begin (4) is not receiving a premium assistance credit under section 36B of the Internal Revenue
Code for calendar year 2017; and
new text end

new text begin (5) is approved by the commissioner as qualifying for premium assistance.
new text end

new text begin Subd. 4. new text end

new text begin Health plan. new text end

new text begin "Health plan" has the meaning provided in Minnesota Statutes,
section 62A.011, subdivision 3.
new text end

new text begin Subd. 5. new text end

new text begin Health plan company. new text end

new text begin "Health plan company" means a health carrier, as
defined in Minnesota Statutes, section 62A.011, subdivision 2, that provides qualified health
coverage in the individual market through MNsure or outside of MNsure to Minnesota
resident individuals in 2017.
new text end

new text begin Subd. 6. new text end

new text begin Individual market. new text end

new text begin "Individual market" means the individual market as defined
in Minnesota Statutes, section 62A.011, subdivision 5.
new text end

new text begin Subd. 7. new text end

new text begin Internal Revenue Code. new text end

new text begin "Internal Revenue Code" means the Internal Revenue
Code as amended through December 31, 2016.
new text end

new text begin Subd. 8. new text end

new text begin Modified adjusted gross income. new text end

new text begin "Modified adjusted gross income" means
the modified adjusted gross income for taxable year 2016, as defined in section 36B(d)(2)(B)
of the Internal Revenue Code.
new text end

new text begin Subd. 9. new text end

new text begin Premium assistance. new text end

new text begin "Premium assistance," "assistance amount," or "assistance"
means the amount allowed to an eligible individual as determined by the commissioner
under section 3 as a percentage of the qualified premium.
new text end

new text begin Subd. 10. new text end

new text begin Program. new text end

new text begin "Program" means the premium assistance program established
under section 1.
new text end

new text begin Subd. 11. new text end

new text begin Qualified health coverage. new text end

new text begin "Qualified health coverage" means health coverage
provided under a qualified health plan, as defined in Minnesota Statutes, section 62V.02,
subdivision 11, or provided under a health plan that meets the standards of a qualified health
plan except that it is not purchased through MNsure, and is:
new text end

new text begin (1) offered to individuals in the individual market;
new text end

new text begin (2) not a grandfathered health plan, as defined in section 36B of the Internal Revenue
Code; and
new text end

new text begin (3) provided by a health plan company through MNsure or outside of MNsure.
new text end

new text begin Subd. 12. new text end

new text begin Qualified premium. new text end

new text begin "Qualified premium" means the premium for qualified
health coverage purchased by an eligible individual.
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. 3. new text begin PREMIUM ASSISTANCE AMOUNT.
new text end

new text begin Subdivision 1. new text end

new text begin Applications by individuals; notification of eligibility. new text end

new text begin (a) An eligible
individual may apply to the commissioner to receive premium assistance under this section
at any time after purchase of qualified health coverage, but no later than January 31, 2018.
The commissioner shall prescribe the manner and form for applications, including requiring
any information the commissioner considers necessary or useful in determining whether an
applicant is eligible and the assistance amount allowed to the individual under this section.
The commissioner shall make application forms available on the agency's Web site.
new text end

new text begin (b) The commissioner shall notify applicants of their eligibility status under the program,
including, for applicants determined to be eligible, their premium assistance amount.
new text end

new text begin Subd. 2. new text end

new text begin Health plan companies. new text end

new text begin (a) By the first of each month, and any other times
the commissioner requires, each health plan company shall provide to the commissioner an
effectuated coverage list with the following information for each individual for whom it
provides qualified health coverage:
new text end

new text begin (1) name, address, and age of each individual covered by the health plan, and any other
identifying information that the commissioner determines appropriate to administer the
program;
new text end

new text begin (2) the qualified premium for the coverage;
new text end

new text begin (3) whether the coverage is individual or family coverage;
new text end

new text begin (4) whether the individual is receiving advance payment of the credit under section 36B
of the Internal Revenue Code; and
new text end

new text begin (5) any additional information the commissioner determines appropriate to administer
the program.
new text end

new text begin (b) A health plan company must notify the commissioner of coverage terminations of
eligible individuals within ten business days.
new text end

new text begin (c) Each health plan company shall make the application forms developed by the
commissioner under subdivision 1 available on the company's Web site, and shall include
application forms with premium notices for individual health coverage.
new text end

new text begin Subd. 3. new text end

new text begin Income eligibility rules. new text end

new text begin (a) Individuals with incomes that meet the requirements
of this subdivision satisfy the income eligibility requirements for the program. For purposes
of this subdivision, "poverty line" has the meaning used in section 36B of the Internal
Revenue Code, except that modified adjusted gross income, as reported on the individual's
federal income tax return for tax year 2016, must be used instead of household income. For
married separate filers claiming eligibility for family coverage, modified adjusted gross
income equals the sum of that income reported by both spouses on their returns.
new text end

new text begin (b) The following income categories apply.
new text end

new text begin Modified Adjusted Gross Income: new text end	new text begin Income Category: new text end
new text begin (1) not exceeding 300 percent of poverty line; new text end	new text begin not eligible new text end
new text begin (2) greater than 300 percent but not exceeding 400 percent of the poverty line; new text end	new text begin category 1 new text end
new text begin (3) greater than 400 percent but not exceeding 600 percent of the poverty line; new text end	new text begin category 2 new text end
new text begin (4) greater than 600 percent but not exceeding 800 percent of the poverty line; and new text end	new text begin category 3 new text end
new text begin (5) greater than 800 percent of the poverty line. new text end	new text begin not eligible new text end

new text begin Subd. 4. new text end

new text begin Determination of assistance amounts. new text end

new text begin (a) The commissioner shall determine
premium assistance amounts as provided under this subdivision so that the estimated sum
of all premium assistance for eligible individuals does not exceed the appropriation for this
purpose.
new text end

new text begin (b) The commissioner shall determine premium assistance amounts as follows:
new text end

new text begin (1) for the period January 1, 2017, through March 31, 2017, eligible individuals in income
categories 1, 2, and 3 qualify for premium assistance equal to 25 percent of the qualified
premium for effectuated coverage;
new text end

new text begin (2) for the period April 1, 2017, through December 31, 2017, eligible individuals in
income category 1 qualify for premium assistance equal to 30 percent of the qualified
premium for effectuated coverage;
new text end

new text begin (3) for the period April 1, 2017, through December 31, 2017, eligible individuals in
income category 2 qualify for premium assistance equal to 25 percent of the qualified
premium for effectuated coverage; and
new text end

new text begin (4) for the period April 1, 2017, through December 31, 2017, eligible individuals in
income category 3 qualify for premium assistance at a level to be determined by the
commissioner based on the availability of funding, but not to exceed 20 percent of the
qualified premium for effectuated coverage.
new text end

new text begin Subd. 5. new text end

new text begin Provision of premium assistance to eligible individuals. new text end

new text begin (a) The commissioner
shall provide the premium assistance amount calculated under subdivision 4 on a monthly
basis to each eligible individual. The commissioner shall provide each eligible individual
with the option of receiving premium assistance through direct deposit to a financial
institution.
new text end

new text begin (b) If the commissioner, for administrative reasons, is unable to provide an eligible
individual with the premium assistance owed for one or more months for which the eligible
individual had effectuated coverage, the commissioner shall include the premium assistance
owed for that period with the premium assistance payment for the first month for which the
commissioner is able to provide premium assistance in a timely manner.
new text end

new text begin (c) The commissioner may require an eligible individual to provide any documentation
and substantiation of payment of the qualified premium that the commissioner considers
appropriate.
new text end

new text begin Subd. 6. new text end

new text begin Contracting. new text end

new text begin The commissioner may contract with a third-party administrator
to determine eligibility for and administer premium assistance under this section.
new text end

new text begin Subd. 7. new text end

new text begin Verification. new text end

new text begin The commissioner shall verify that persons applying for premium
assistance are residents of Minnesota. The commissioner may access information from the
Department of Employment and Economic Development and the Minnesota Department
of Revenue when verifying residency.
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. 4. new text begin AUDIT AND PROGRAM INTEGRITY.
new text end

new text begin Subdivision 1. new text end

new text begin Audit. new text end

new text begin The legislative auditor shall audit implementation of the premium
assistance program by the commissioner to determine whether premium assistance payments
align with the criteria established in sections 2 and 3. The legislative auditor shall present
a report summarizing findings of the audit to the legislative committees with jurisdiction
over insurance and health by June 1, 2018.
new text end

new text begin Subd. 2. new text end

new text begin Program integrity. new text end

new text begin The commissioner of revenue shall ensure that only eligible
individuals, as defined in section 2, subdivision 3, have received premium assistance. The
commissioner of revenue shall review information available from Minnesota Management
and Budget, the Department of Human Services, MNsure, and the most recent Minnesota
tax records to identify ineligible individuals who received premium assistance. The
commissioner of revenue shall recover the amount of any premium assistance paid on behalf
of an ineligible individual from the ineligible individual, in the manner provided by law for
the collection of unpaid taxes or erroneously paid refunds of taxes.
new text end

new text begin EFFECTIVE DATE. new text end

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

Sec. 5. new text begin TRANSFER.
new text end

new text begin $300,500,000 in fiscal year 2017 is transferred from the budget reserve account in
Minnesota Statutes, section 16A.152, subdivision 1a, to the general fund.
new text end

Sec. 6. new text begin APPROPRIATIONS.
new text end

new text begin (a) $285,000,000 in fiscal year 2017 is appropriated from the general fund to the
commissioner of Minnesota Management and Budget for purposes of providing premium
assistance under section 3. No more than three percent of this appropriation is available to
the commissioner for administrative costs. This is a onetime appropriation and is available
until June 30, 2018.
new text end

new text begin (b) $500,000 in fiscal year 2017 is appropriated from the general fund to the legislative
auditor to conduct the audit required by section 4. This is a onetime appropriation and is
available until expended.
new text end

ARTICLE 2

INSURANCE MARKET REFORMS

Section 1.

Minnesota Statutes 2016, section 60A.08, subdivision 15, is amended to read:

Subd. 15.

Classification of insurance filings data.

(a) All forms, rates, and related
information filed with the commissioner under section 61A.02 shall be nonpublic data until
the filing becomes effective.

(b) All forms, rates, and related information filed with the commissioner under section
62A.02 shall be nonpublic data until the filing becomes effective.

(c) All forms, rates, and related information filed with the commissioner under section
62C.14, subdivision 10, shall be nonpublic data until the filing becomes effective.

(d) All forms, rates, and related information filed with the commissioner under section
70A.06 shall be nonpublic data until the filing becomes effective.

(e) All forms, rates, and related information filed with the commissioner under section
79.56 shall be nonpublic data until the filing becomes effective.

(f) Notwithstanding paragraphs (b) and (c), for all rate increases subject to review under
section 2794 of the Public Health Services Act and any amendments to, or regulations, or
guidance issued under the act that are filed with the commissioner on or after September 1,
2011, the commissioner:

(1) may acknowledge receipt of the information;

(2) may acknowledge that the corresponding rate filing is pending review;

(3) must provide public access from the Department of Commerce's Web site to parts I
and II of the Preliminary Justifications of the rate increases subject to review; and

(4) must provide notice to the public on the Department of Commerce's Web site of the
review of the proposed rate, which must include a statement that the public has 30 calendar
days to submit written comments to the commissioner on the rate filing subject to review.

new text begin (g) Notwithstanding paragraphs (b) and (c), for all rates for individual health plans, as
defined in section 62A.011, subdivision 4, and small employer plans, as defined in section
62L.02, subdivision 28, the commissioner must provide:
new text end

new text begin (1) public access to the information described in clause (2) from the Department of
Commerce's Web site within ten days of receiving a rate filing from a health plan, as defined
in section 62A.011, subdivision 3; and
new text end

new text begin (2) compiled data of the proposed change to rates separated by health plan and geographic
rating area.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective 30 days following final enactment.
new text end

Sec. 2.

Minnesota Statutes 2016, section 60A.235, subdivision 3, is amended to read:

Subd. 3.

Health plan policies issued as stop loss coverage.

(a) An insurance company
or health carrier issuing or renewing an insurance policy or other evidence of coverage, that
provides coverage to an employer for health care expenses incurred under an
employer-sponsored plan provided to the employer's employees, retired employees, or their
dependents, shall issue the policy or evidence of coverage as a health plan if the policy or
evidence of coverage:

(1) has a specific attachment point for claims incurred per individual that is lower than
deleted text begin $20,000 deleted text end new text begin $10,000 new text end ; or

deleted text begin (2) has an aggregate attachment point, for groups of 50 or fewer, that is lower than the
greater of:
deleted text end

deleted text begin (i) $4,000 times the number of group members;
deleted text end

deleted text begin (ii) 120 percent of expected claims; or
deleted text end

deleted text begin (iii) $20,000; or
deleted text end

deleted text begin (3) deleted text end new text begin (2) new text end has an aggregate attachment point deleted text begin for groups of 51 or more deleted text end that is lower than
110 percent of expected claims.

(b) An insurer shall determine the number of persons in a group, for the purposes of this
section, on a consistent basis, at least annually. Where the insurance policy or evidence of
coverage applies to a contract period of more than one year, the dollar amounts set forth in
paragraph (a), deleted text begin clauses deleted text end new text begin clause new text end (1) deleted text begin and (2) deleted text end , must be multiplied by the length of the contract
period expressed in years.

deleted text begin (c) The commissioner may adjust the constant dollar amounts provided in paragraph
(a), clauses (1), (2), and (3), on January 1 of any year, based upon changes in the medical
component of the Consumer Price Index (CPI). Adjustments must be in increments of $100
and must not be made unless at least that amount of adjustment is required. The commissioner
shall publish any change in these dollar amounts at least six months before their effective
date.
deleted text end

deleted text begin (d) deleted text end new text begin (c) new text end A policy or evidence of coverage issued by an insurance company or health carrier
that provides direct coverage of health care expenses of an individual including a policy or
evidence of coverage administered on a group basis is a health plan regardless of whether
the policy or evidence of coverage is denominated as stop loss coverage.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective 30 days following final enactment, and
applies to policies or evidence of coverage offered, issued, or renewed to an employer on
or after that date.
new text end

Sec. 3.

Minnesota Statutes 2016, section 60A.236, is amended to read:

60A.236 STOP LOSS REGULATION; SMALL EMPLOYER COVERAGE.

A contract providing stop loss coverage, issued or renewed to a small employer, as
defined in section 62L.02, subdivision 26, or to a plan sponsored by a small employer, must
include a claim settlement period no less favorable to the small employer or plan than
deleted text begin coverage of all deleted text end new text begin the following:
new text end

new text begin (1) new text end claims incurred during the contract period deleted text begin regardless of when the claims are deleted text end new text begin ; and
new text end

new text begin (2) new text end paid new text begin by the plan during the contract period or within one month after expiration of
the contract period new text end .

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective 30 days following final enactment, and
applies to policies or evidence of coverage offered, issued, or renewed to an employer on
or after that date.
new text end

Sec. 4.

Minnesota Statutes 2016, section 62D.02, subdivision 4, is amended to read:

Subd. 4.

Health maintenance organization.

deleted text begin (a) deleted text end "Health maintenance organization"
means a deleted text begin nonprofit deleted text end new text begin foreign or domestic new text end corporation deleted text begin organized under chapter 317A deleted text end , or a local
governmental unit as defined in subdivision 11, controlled and operated as provided in
sections 62D.01 to 62D.30, which provides, either directly or through arrangements with
providers or other persons, comprehensive health maintenance services, or arranges for the
provision of these services, to enrollees on the basis of a fixed prepaid sum without regard
to the frequency or extent of services furnished to any particular enrollee.

deleted text begin (b) [Expired]
deleted text end

new text begin EFFECTIVE DATE. new text end

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

Sec. 5.

Minnesota Statutes 2016, section 62D.03, subdivision 1, is amended to read:

Subdivision 1.

Certificate of authority required.

Notwithstanding any law of this state
to the contrary, any deleted text begin nonprofit deleted text end new text begin foreign or domestic new text end corporation organized to do so or a local
governmental unit may apply to the commissioner of health for a certificate of authority to
establish and operate a health maintenance organization in compliance with sections 62D.01
to 62D.30. No person shall establish or operate a health maintenance organization in this
state, nor sell or offer to sell, or solicit offers to purchase or receive advance or periodic
consideration in conjunction with a health maintenance organization or health maintenance
contract unless the organization has a certificate of authority under sections 62D.01 to
62D.30.

new text begin EFFECTIVE DATE. new text end

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

Sec. 6.

Minnesota Statutes 2016, section 62D.05, subdivision 1, is amended to read:

Subdivision 1.

Authority granted.

Any deleted text begin nonprofit deleted text end corporation or local governmental
unit may, upon obtaining a certificate of authority as required in sections 62D.01 to 62D.30,
operate as a health maintenance organization.

new text begin EFFECTIVE DATE. new text end

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

Sec. 7.

Minnesota Statutes 2016, section 62D.06, subdivision 1, is amended to read:

Subdivision 1.

Governing body composition; enrollee advisory body.

The governing
body of any health maintenance organization which is a deleted text begin nonprofit deleted text end corporation may include
enrollees, providers, or other individuals; provided, however, that after a health maintenance
organization which is a deleted text begin nonprofit deleted text end corporation has been authorized under sections 62D.01
to 62D.30 for one year, at least 40 percent of the governing body shall be composed of
enrollees and members elected by the enrollees and members from among the enrollees and
members. For purposes of this section, "member" means a consumer who receives health
care services through a self-insured contract that is administered by the health maintenance
organization or its related third-party administrator. The number of members elected to the
governing body shall not exceed the number of enrollees elected to the governing body. An
enrollee or member elected to the governing board may not be a person:

(1) whose occupation involves, or before retirement involved, the administration of
health activities or the provision of health services;

(2) who is or was employed by a health care facility as a licensed health professional;
or

(3) who has or had a direct substantial financial or managerial interest in the rendering
of a health service, other than the payment of a reasonable expense reimbursement or
compensation as a member of the board of a health maintenance organization.

After a health maintenance organization which is a local governmental unit has been
authorized under sections 62D.01 to 62D.30 for one year, an enrollee advisory body shall
be established. The enrollees who make up this advisory body shall be elected by the enrollees
from among the enrollees.

new text begin EFFECTIVE DATE. new text end

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

Sec. 8.

Minnesota Statutes 2016, section 62D.19, is amended to read:

62D.19 UNREASONABLE EXPENSES.

No health maintenance organization shall incur or pay for any expense of any nature
which is unreasonably high in relation to the value of the service or goods provided. The
commissioner of health shall implement and enforce this section by rules adopted under
this section.

In an effort to achieve the stated purposes of sections 62D.01 to 62D.30 deleted text begin ; in order to
safeguard the underlying nonprofit status of health maintenance organizations; deleted text end and to ensure
that the payment of health maintenance organization money to major participating entities
results in a corresponding benefit to the health maintenance organization and its enrollees,
when determining whether an organization has incurred an unreasonable expense in relation
to a major participating entity, due consideration shall be given to, in addition to any other
appropriate factors, whether the officers and trustees of the health maintenance organization
have acted with good faith and in the best interests of the health maintenance organization
in entering into, and performing under, a contract under which the health maintenance
organization has incurred an expense. The commissioner has standing to sue, on behalf of
a health maintenance organization, officers or trustees of the health maintenance organization
who have breached their fiduciary duty in entering into and performing such contracts.

new text begin EFFECTIVE DATE. new text end

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

Sec. 9.

Minnesota Statutes 2016, section 62E.02, subdivision 3, is amended to read:

Subd. 3.

Health maintenance organization.

"Health maintenance organization" means
a deleted text begin nonprofit deleted text end corporation licensed and operated as provided in chapter 62D.

new text begin EFFECTIVE DATE. new text end

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

Sec. 10.

Minnesota Statutes 2016, section 62L.12, subdivision 2, is amended to read:

Subd. 2.

Exceptions.

(a) A health carrier may renew individual conversion policies to
eligible employees otherwise eligible for conversion coverage under section 62D.104 as a
result of leaving a health maintenance organization's service area.

(b) A health carrier may renew individual conversion policies to eligible employees
otherwise eligible for conversion coverage as a result of the expiration of any continuation
of group coverage required under sections 62A.146, 62A.17, 62A.21, 62C.142, 62D.101,
and 62D.105.

(c) A health carrier may renew conversion policies to eligible employees.

(d) A health carrier may sell, issue, or renew individual continuation policies to eligible
employees as required.

(e) A health carrier may sell, issue, or renew individual health plans if the coverage is
appropriate due to an unexpired preexisting condition limitation or exclusion applicable to
the person under the employer's group health plan or due to the person's need for health
care services not covered under the employer's group health plan.

(f) A health carrier may sell, issue, or renew an individual health plan, if the individual
has elected to buy the individual health plan not as part of a general plan to substitute
individual health plans for a group health plan nor as a result of any violation of subdivision
3 or 4.

(g) A health carrier may sell, issue, or renew an individual health plan if coverage
provided by the employer is determined to be unaffordable under the provisions of the
Affordable Care Act as defined in section 62A.011, subdivision 1a.

(h) Nothing in this subdivision relieves a health carrier of any obligation to provide
continuation or conversion coverage otherwise required under federal or state law.

(i) Nothing in this chapter restricts the offer, sale, issuance, or renewal of coverage issued
as a supplement to Medicare under sections 62A.3099 to 62A.44, or policies or contracts
that supplement Medicare issued by health maintenance organizations, or those contracts
governed by sections 1833, 1851 to 1859, 1860D, or 1876 of the federal Social Security
Act, United States Code, title 42, section 1395 et seq., as amended.

(j) Nothing in this chapter restricts the offer, sale, issuance, or renewal of individual
health plans necessary to comply with a court order.

(k) A health carrier may offer, issue, sell, or renew an individual health plan to persons
eligible for an employer group health plan, if the individual health plan is a high deductible
health plan for use in connection with an existing health savings account, in compliance
with the Internal Revenue Code, section 223. In that situation, the same or a different health
carrier may offer, issue, sell, or renew a group health plan to cover the other eligible
employees in the group.

(l) A health carrier may offer, sell, issue, or renew an individual health plan to one or
more employees of a small employer if the individual health plan is marketed directly to
all employees of the small employer and the small employer does not contribute directly or
indirectly to the premiums or facilitate the administration of the individual health plan. The
requirement to market an individual health plan to all employees does not require the health
carrier to offer or issue an individual health plan to any employee. For purposes of this
paragraph, an employer is not contributing to the premiums or facilitating the administration
of the individual health plan if the employer does not contribute to the premium and merely
collects the premiums from an employee's wages or salary through payroll deductions and
submits payment for the premiums of one or more employees in a lump sum to the health
carrier. Except for coverage under section 62A.65, subdivision 5, paragraph (b), at the
request of an employee, the health carrier may bill the employer for the premiums payable
by the employee, provided that the employer is not liable for payment except from payroll
deductions for that purpose. If an employer is submitting payments under this paragraph,
the health carrier shall provide a cancellation notice directly to the primary insured at least
ten days prior to termination of coverage for nonpayment of premium. Individual coverage
under this paragraph may be offered only if the small employer has not provided coverage
under section 62L.03 to the employees within the past 12 months.

new text begin (m) A health carrier may offer, sell, issue, or renew an individual health plan to one or
more employees of a small employer if the small employer, eligible employee, and individual
health plan are in compliance with the 21st Century Cures Act, Public Law 114-255.
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. 11.

new text begin [62Q.556] UNAUTHORIZED PROVIDER SERVICES.
new text end

new text begin Subdivision 1. new text end

new text begin Unauthorized provider services. new text end

new text begin (a) Except as provided in paragraph
(c), unauthorized provider services occur when an enrollee receives services:
new text end

new text begin (1) from a nonparticipating provider at a participating hospital or ambulatory surgical
center, when the services are rendered:
new text end

new text begin (i) due to the unavailability of a participating provider;
new text end

new text begin (ii) by a nonparticipating provider without the enrollee's knowledge; or
new text end

new text begin (iii) due to the need for unforeseen services arising at the time the services are being
rendered;
new text end

new text begin (2) from a nonparticipating provider in a participating provider's practice setting under
circumstances not described in clause (1);
new text end

new text begin (3) from a participating provider that sends a specimen taken from the enrollee in the
participating provider's practice setting to a nonparticipating laboratory, pathologist, or other
medical testing facility; or
new text end

new text begin (4) not described in clause (3) that are performed by a nonparticipating provider, if a
referral for the services is required by the health plan.
new text end

new text begin (b) Unauthorized provider services do not include emergency services as defined in
section 62Q.55, subdivision 3.
new text end

new text begin (c) The services described in paragraph (a), clauses (2) to (4), are not unauthorized
provider services if the enrollee gives advance written consent to the provider acknowledging
that the use of a provider, or the services to be rendered, may result in costs not covered by
the health plan.
new text end

new text begin Subd. 2. new text end

new text begin Prohibition. new text end

new text begin An enrollee must have the same cost-sharing requirements for
unauthorized provider services, including co-payments, deductibles, coinsurance, coverage
restrictions, and coverage limitations as those applicable to services received by the enrollee
from a participating provider.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective 30 days following final enactment and
applies to provider services provided on or after that date.
new text end

Sec. 12.

new text begin [62Q.557] BALANCE BILLING PROHIBITED.
new text end

new text begin A participating provider is prohibited from billing an enrollee for any amount in excess
of the allowable amount the health plan company has contracted for with the provider as
total payment for the health care services. A participating provider is permitted to bill an
enrollee the approved co-payment, deductible, or coinsurance.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective July 1, 2017, and applies to health plans
offered, issued, or renewed to a Minnesota resident on or after that date.
new text end

Sec. 13. new text begin TRANSITION OF CARE COVERAGE FOR CALENDAR YEAR 2017;
INVOLUNTARY TERMINATION OF COVERAGE.
new text end

new text begin Subdivision 1. new text end

new text begin Definitions. new text end

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

new text begin (b) "Enrollee" has the meaning given in Minnesota Statutes, section 62Q.01, subdivision
2b.
new text end

new text begin (c) "Health plan" has the meaning given in Minnesota Statutes, section 62Q.01,
subdivision 3.
new text end

new text begin (d) "Health plan company" has the meaning given in Minnesota Statutes, section 62Q.01,
subdivision 4.
new text end

new text begin (e) "Individual market" has the meaning given in Minnesota Statutes, section 62A.011,
subdivision 5.
new text end

new text begin (f) "Involuntary termination of coverage" means the termination of a health plan due to
a health plan company's refusal to renew the health plan in the individual market because
the health plan company elects to cease offering individual market health plans in all or
some geographic rating areas of the state.
new text end

new text begin Subd. 2. new text end

new text begin Application. new text end

new text begin This section applies to an enrollee who is subject to a change in
health plans in the individual market due to an involuntary termination of coverage from a
health plan in the individual market after October 31, 2016, and before January 1, 2017,
and who enrolls in a new health plan in the individual market for all or a portion of calendar
year 2017 that goes into effect after December 31, 2016, and before March 2, 2017.
new text end

new text begin Subd. 3. new text end

new text begin Change in health plans; transition of care coverage. new text end

new text begin (a) If an enrollee satisfies
the criteria in subdivision 2, the enrollee's new health plan company must provide, upon
request of the enrollee or the enrollee's health care provider, authorization to receive services
that are otherwise covered under the terms of the enrollee's calendar year 2017 health plan
from a provider who provided care on an in-network basis to the enrollee during calendar
year 2016 but who is out of network in the enrollee's calendar year 2017 health plan:
new text end

new text begin (1) for up to 120 days if the enrollee has received a diagnosis of, or is engaged in a
current course of treatment for, one or more of the following conditions:
new text end

new text begin (i) an acute condition;
new text end

new text begin (ii) a life-threatening mental or physical illness;
new text end

new text begin (iii) pregnancy beyond the first trimester of pregnancy;
new text end

new text begin (iv) a physical or mental disability defined as an inability to engage in one or more major
life activities, provided the disability has lasted or can be expected to last for at least one
year or can be expected to result in death; or
new text end

new text begin (v) a disabling or chronic condition that is in an acute phase; or
new text end

new text begin (2) for the rest of the enrollee's life if a physician certifies that the enrollee has an expected
lifetime of 180 days or less.
new text end

new text begin (b) For all requests for authorization under this subdivision, the health plan company
must grant the request for authorization unless the enrollee does not meet the criteria in
paragraph (a) or subdivision 2.
new text end

new text begin (c) The commissioner of Minnesota Management and Budget must reimburse the
enrollee's new health plan company for costs attributed to services authorized under this
subdivision. Costs eligible for reimbursement under this paragraph are the difference between
the health plan company's reimbursement rate for in-network providers for a service
authorized under this subdivision and its rate for out-of-network providers for the service.
The health plan company must seek reimbursement from the commissioner for costs
attributed to services authorized under this subdivision, in a form and manner mutually
agreed upon by the commissioner and the affected health plan companies. Total state
reimbursements to health plan companies under this paragraph are subject to the limits of
the available appropriation. In the event that funding for reimbursements to health plan
companies is not sufficient to fully reimburse health plan companies for the costs attributed
to services authorized under this subdivision, health plan companies must continue to cover
services authorized under this subdivision.
new text end

new text begin Subd. 4. new text end

new text begin Limitations. new text end

new text begin (a) Subdivision 3 applies only if the enrollee's health care provider
agrees to:
new text end

new text begin (1) accept as payment in full the lesser of:
new text end

new text begin (i) the health plan company's reimbursement rate for in-network providers for the same
or similar service; or
new text end

new text begin (ii) the provider's regular fee for that service;
new text end

new text begin (2) request authorization for services in the form and manner specified by the enrollee's
new health plan company, if the provider chooses to request authorization; and
new text end

new text begin (3) provide the enrollee's new health plan company with all necessary medical information
related to the care provided to the enrollee.
new text end

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

new text begin Subd. 5. new text end

new text begin Request for authorization. new text end

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

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for health plans issued after December
31, 2016, and before March 2, 2017, and that are in effect for all or a portion of calendar
year 2017. This section expires June 30, 2018.
new text end

Sec. 14. new text begin COSTS RELATED TO IMPLEMENTATION OF THIS ACT.
new text end

new text begin A state agency that incurs administrative costs to implement one or more provisions in
this act and does not receive an appropriation for administrative costs in section 16 or article
1, section 6, must implement the act within the limits of existing appropriations.
new text end

Sec. 15. new text begin INSURANCE MARKET OPTIONS.
new text end

new text begin The commissioner of commerce shall report by February 15, 2017, to the standing
committees of the legislature having jurisdiction over insurance and health on:
new text end

new text begin (1) a plan to implement and operate a residency verification process for individual health
insurance market participants; and
new text end

new text begin (2) the past and future use of Minnesota Statutes 2005, section 62L.056, and Minnesota
Statutes, section 62Q.188, including:
new text end

new text begin (i) rate and form filings received, approved, or withdrawn;
new text end

new text begin (ii) barriers to current utilization, including federal and state laws; and
new text end

new text begin (iii) recommendations for allowing or increasing the offering of health plans compliant
with Minnesota Statutes, section 62Q.188.
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. 16. new text begin APPROPRIATION; COVERAGE FOR TRANSITION OF CARE.
new text end

new text begin $15,000,000 in fiscal year 2017 is appropriated from the general fund to the commissioner
of Minnesota Management and Budget to reimburse health plan companies for costs attributed
to coverage of transition of care services under section 13. No more than three percent of
this appropriation is available to the commissioner for administrative costs. This is a onetime
appropriation and is available until expended.
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. 17. new text begin REPEALER.
new text end

new text begin (a) new text end new text begin Minnesota Statutes 2016, section 62D.12, subdivision 9, new text end new text begin is repealed effective the
day following final enactment.
new text end

new text begin (b) new text end new text begin Minnesota Statutes 2016, section 62K.11, new text end new text begin is repealed effective July 1, 2017.
new text end

APPENDIX

Repealed Minnesota Statutes: 17-1270

62D.12 PROHIBITED PRACTICES.

Subd. 9.

Net earnings.

All net earnings of the health maintenance organization shall be devoted to the nonprofit purposes of the health maintenance organization in providing comprehensive health care. No health maintenance organization shall provide for the payment, whether directly or indirectly, of any part of its net earnings, to any person as a dividend or rebate; provided, however, that health maintenance organizations may make payments to providers or other persons based upon the efficient provision of services or as incentives to provide quality care. The commissioner of health shall, pursuant to sections 62D.01 to 62D.30, revoke the certificate of authority of any health maintenance organization in violation of this subdivision.

62K.11 BALANCE BILLING PROHIBITED.

(a) A network provider is prohibited from billing an enrollee for any amount in excess of the allowable amount the health carrier has contracted for with the provider as total payment for the health care service. A network provider is permitted to bill an enrollee the approved co-payment, deductible, or coinsurance.

(b) A network provider is permitted to bill an enrollee for services not covered by the enrollee's health plan as long as the enrollee agrees in writing in advance before the service is performed to pay for the noncovered service.