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SF 1432

as introduced - 86th Legislature (2009 - 2010) Posted on 02/09/2010 02:20am

KEY: stricken = removed, old language.
underscored = added, new language.

Current Version - as introduced

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A bill for an act
relating to health care; providing an alternative mechanism for prompt payment
of emergency room and ambulance charges incurred by patients enrolled in
very high deductible health plans; amending Minnesota Statutes 2008, sections
60A.23, subdivision 8; 62Q.01, by adding a subdivision; 62Q.025, by adding a
subdivision.

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

Section 1.

Minnesota Statutes 2008, section 60A.23, subdivision 8, is amended to read:


Subd. 8.

Self-insurance or insurance plan administrators who are vendors
of risk management services.

(1) Scope. This subdivision applies to any vendor of
risk management services and to any entity which administers, for compensation, a
self-insurance or insurance plan. This subdivision does not apply (a) to an insurance
company authorized to transact insurance in this state, as defined by section 60A.06,
subdivision 1, clauses (4) and (5)
; (b) to a service plan corporation, as defined by section
62C.02, subdivision 6; (c) to a health maintenance organization, as defined by section
62D.02, subdivision 4; (d) to an employer directly operating a self-insurance plan for
its employees' benefits; (e) to an entity which administers a program of health benefits
established pursuant to a collective bargaining agreement between an employer, or group
or association of employers, and a union or unions; or (f) to an entity which administers a
self-insurance or insurance plan if a licensed Minnesota insurer is providing insurance
to the plan and if the licensed insurer has appointed the entity administering the plan as
one of its licensed agents within this state.

(2) Definitions. For purposes of this subdivision the following terms have the
meanings given them.

(a) "Administering a self-insurance or insurance plan" means (i) processing,
reviewing or paying claims, (ii) establishing or operating funds and accounts, or (iii)
otherwise providing necessary administrative services in connection with the operation of
a self-insurance or insurance plan.

(b) "Employer" means an employer, as defined by section 62E.02, subdivision 2.

(c) "Entity" means any association, corporation, partnership, sole proprietorship,
trust, or other business entity engaged in or transacting business in this state.

(d) "Self-insurance or insurance plan" means a plan providing life, medical or
hospital care, accident, sickness or disability insurance for the benefit of employees or
members of an association, or a plan providing liability coverage for any other risk or
hazard, which is or is not directly insured or provided by a licensed insurer, service plan
corporation, or health maintenance organization.

(e) "Vendor of risk management services" means an entity providing for
compensation actuarial, financial management, accounting, legal or other services for the
purpose of designing and establishing a self-insurance or insurance plan for an employer.

(3) License. No vendor of risk management services or entity administering a
self-insurance or insurance plan may transact this business in this state unless it is licensed
to do so by the commissioner. An applicant for a license shall state in writing the type of
activities it seeks authorization to engage in and the type of services it seeks authorization
to provide. The license may be granted only when the commissioner is satisfied that the
entity possesses the necessary organization, background, expertise, and financial integrity
to supply the services sought to be offered. The commissioner may issue a license subject
to restrictions or limitations upon the authorization, including the type of services which
may be supplied or the activities which may be engaged in. The license fee is $1,500
for the initial application and $1,500 for each three-year renewal. All licenses are for
a period of three years.

(4) Regulatory restrictions; powers of the commissioner. To assure that
self-insurance or insurance plans are financially solvent, are administered in a fair and
equitable fashion, and are processing claims and paying benefits in a prompt, fair,
and honest manner, vendors of risk management services and entities administering
insurance or self-insurance plans are subject to the supervision and examination by the
commissioner. Vendors of risk management services, entities administering insurance or
self-insurance plans, and insurance or self-insurance plans established or operated by
them are subject to the trade practice requirements of sections 72A.19 to 72A.30. In lieu
of an unlimited guarantee from a parent corporation for a vendor of risk management
services or an entity administering insurance or self-insurance plans, the commissioner
may accept a surety bond in a form satisfactory to the commissioner in an amount equal to
120 percent of the total amount of claims handled by the applicant in the prior year. If at
any time the total amount of claims handled during a year exceeds the amount upon which
the bond was calculated, the administrator shall immediately notify the commissioner.
The commissioner may require that the bond be increased accordingly.

No contract entered into after July 1, 2001, between a licensed vendor of risk
management services and a group authorized to self-insure for workers' compensation
liabilities under section 79A.03, subdivision 6, may take effect until it has been filed
with the commissioner, and either (1) the commissioner has approved it or (2) 60 days
have elapsed and the commissioner has not disapproved it as misleading or violative of
public policy.

new text begin An entity administering an insurance plan that consists of, includes, or is connected
with a very high deductible health plan (VHDHP) as defined in section 62Q.01, subdivision
7, must comply with section 62Q.025, subdivision 3. This applies when the entity is either:
new text end

new text begin (i) acting under an assumption of responsibility under section 62Q.025, subdivision
3, paragraph (d); or
new text end

new text begin (ii) performing under a contract that is subject to this subdivision.
new text end

new text begin The entity must not enter into any contractual relationship or perform any services in
connection with a VHDHP that does not by its terms provide for compliance with section
62Q.025, subdivision 3, either by the health plan company or by an entity administering
the insurance plan under this subdivision.
new text end

(5) Rulemaking authority. To carry out the purposes of this subdivision, the
commissioner may adopt rules pursuant to sections 14.001 to 14.69. These rules may:

(a) establish reporting requirements for administrators of insurance or self-insurance
plans;

(b) establish standards and guidelines to assure the adequacy of financing, reinsuring,
and administration of insurance or self-insurance plans;

(c) establish bonding requirements or other provisions assuring the financial integrity
of entities administering insurance or self-insurance plans; or

(d) establish other reasonable requirements to further the purposes of this
subdivision.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective August 1, 2009, and applies to very
high deductible health plans offered, issued, sold, or renewed on or after that date.
new text end

Sec. 2.

Minnesota Statutes 2008, section 62Q.01, is amended by adding a subdivision
to read:


new text begin Subd. 7. new text end

new text begin Very high deductible health plan or VHDHP. new text end

new text begin "Very high deductible
health plan" or "VHDHP" means a high deductible health plan that has an annual
maximum out-of-pocket expense that exceeds $3,000 for individual coverage or $6,000
for family coverage.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective August 1, 2009, and applies to very
high deductible health plans offered, issued, sold, or renewed on or after that date.
new text end

Sec. 3.

Minnesota Statutes 2008, section 62Q.025, is amended by adding a subdivision
to read:


new text begin Subd. 3. new text end

new text begin Payment of emergency and ambulance charges. new text end

new text begin (a) A very high
deductible health plan, as defined in section 62Q.01, subdivision 7; and a health plan
company that issues such a health plan, are subject to this subdivision as a condition of the
privilege of issuing a VHDHP granted under subdivisions 1 and 2.
new text end

new text begin (b) A health plan company may contract with an entity administering an insurance
plan, as defined in section 60A.23, subdivision 8, to assume the health plan company's
duties and limitations under this subdivision. Under such a contract, the health plan
company retains ultimate responsibility for compliance with this subdivision.
new text end

new text begin (c) If an enrollee in a plan described in paragraph (a) incurs charges for care
provided in a hospital emergency room or for ambulance service, as defined in section
144E.001, subdivision 3, which are not payable under the plan at the time due to the
enrollee not having satisfied the annual deductible, the VHDHP must require that the
health plan company that issued the VHDHP pay those charges directly to the hospital or
ambulance service licensee, as defined in section 144E.001, subdivision 8, within 15 days
after receiving notice from the hospital or ambulance service licensee that the enrollee has
not paid the charges within 30 days after the date of treatment.
new text end

new text begin (d) A health plan company that complies with paragraph (c) may seek and obtain
reimbursement for those payments from its enrollee. The health plan company's collection
procedures must comply with the same restrictions that would have applied to the health
care provider in collecting the charges from the patient. Upon written request of the
health plan company, the hospital or ambulance service licensee shall inform the health
plan company in writing of any special restrictions regarding collection procedures to
which the provider is subject, whether originating under contract or other agreement, law,
or otherwise. No health plan company may cancel, terminate, suspend, nonrenew, or
otherwise limit or reduce an enrollee's coverage, or coverage of the enrollee's family, as a
means of collection or as a penalty for failure to reimburse the health plan company for
a payment made under this subdivision.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective August 1, 2009, and applies to very
high deductible health plans offered, issued, sold, or renewed on or after that date.
new text end