SF 1835

3rd Engrossment - 88th Legislature (2013 - 2014) Posted on 04/09/2014 02:32pm

A bill for an act
relating to insurance; amending provisions relating to health coverage for school
district employees; amending Minnesota Statutes 2012, sections 43A.316,
subdivision 10, by adding a subdivision; 123A.21, subdivisions 5, 6; 123B.09,
subdivision 12; 123B.75, by adding a subdivision; 471.6161, subdivisions 1, 2,
3, by adding a subdivision; 471.895, subdivision 1; Minnesota Statutes 2013
Supplement, section 124D.10, subdivisions 4a, 11, 21.

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

Section 1.

Minnesota Statutes 2012, section 43A.316, subdivision 10, is amended to
read:

Subd. 10.

Exemption.

The public employee insurance program and, where
applicable, the employers participating in it are exempt from chapters 60A, 62A, 62C,
62D, 62E, and 62H, section 471.617, subdivisions 2 and 3 deleted text begin , and the bidding requirements
of section 471.6161 deleted text end .

Sec. 2.

Minnesota Statutes 2012, section 43A.316, is amended by adding a subdivision
to read:

new text begin Subd. 11. new text end

new text begin Proposal from school district; response required. new text end

new text begin Upon receipt of a
request for a proposal from a school district pursuant to section 471.6161, subdivision 8,
the public employees insurance program shall respond to such request within 60 days.
new text end

Sec. 3.

Minnesota Statutes 2012, section 123A.21, subdivision 5, is amended to read:

Subd. 5.

Duties and powers of SC board of directors.

The board of directors shall
have authority to maintain and operate a SC. Subject to the availability of necessary
resources, the powers and duties of this board shall include the following:

(a) The board of directors shall submit, by June 1 of each year to each participating
member, an annual plan which describes the objectives and procedures to be implemented
in assisting in resolution of the needs of the SC.

(b) The SC board of directors shall provide adequate office, service center, and
administrative facilities by lease, purchase, gift, or otherwise.

(c) The SC board of directors shall employ a central administrative staff and other
personnel as necessary to provide and support the agreed-upon programs and services.
The board may discharge staff and personnel pursuant to applicable provisions of law.
SC staff and personnel may participate in retirement programs and any other programs
available to public school staff and personnel.

(d) The SC board of directors may appoint special advisory committees composed
of superintendents, central office personnel, building principals, teachers, parents, lay
persons, and representatives from cities, counties, and other governmental units. new text begin The
committees are considered a committee of a public body for purposes of section 13D.01,
subdivision 1, paragraph (c), when addressing issues related to health insurance.
new text end

(e) The SC board of directors may employ service area personnel pursuant to
licensure and certification standards developed by the appropriate state agency such as the
commissioner and the State Board of Teaching.

(f) The SC board of directors may enter into contracts with school boards of local
districts including school districts outside the SC area.

(g) The SC board of directors may enter into contracts with other public and private
agencies and institutions to provide administrative staff and other personnel as necessary
to furnish and support the agreed-upon programs and services.

(h) The SC board of directors shall exercise all powers and carry out all duties
delegated to it by members under provisions of the SC bylaws. The SC board of directors
shall be governed, when not otherwise provided, by applicable laws of the state.

(i) The SC board of directors shall submit an annual evaluation report of the
effectiveness of programs and services to the members by September 1 of each year
following the previous June 30 in which the programs and services were provided.

(j) The SC board is encouraged to establish cooperative, working relationships and
partnerships with postsecondary educational institutions, other public agencies, business,
and industry.

Sec. 4.

Minnesota Statutes 2012, section 123A.21, subdivision 6, is amended to read:

Subd. 6.

Appointment of advisory council.

There may be advisory councils
selected to give advice and counsel to the SC board of directors. The councils may be
composed of representatives from public and nonpublic schools, cities, counties, and other
governmental units. new text begin The advisory councils are considered to be a committee of a public
body for purposes of section 13D.01, subdivision 1, paragraph (c), when addressing
issues related to health insurance.
new text end

Sec. 5.

Minnesota Statutes 2012, section 123B.09, subdivision 12, is amended to read:

Subd. 12.

Board to fix compensation.

The clerk, treasurer, and superintendent
of any district shall receive such compensation as may be fixed by the board. Unless
otherwise provided by law, the other members of the board shall also receive such
compensation as may be fixed by the board. All members of the board may receive
reimbursement for transportation at the rate provided for in section 471.665. new text begin No board
member or school district employee shall receive any compensation or benefits based on
incentives or other money provided to the school district by or from a source of group
insurance coverage referenced in section 471.6161, subdivision 1, except for a refund
provided under section 123B.75.
new text end

Sec. 6.

Minnesota Statutes 2012, section 123B.75, is amended by adding a subdivision
to read:

new text begin Subd. 10. new text end

new text begin Insurance premium refund. new text end

new text begin (a) If money collected by an entity
providing group insurance under section 471.6161, subdivision 1, for the payment of
insurance premiums are above the cost of that coverage and returned to the school district
purchasing that coverage as a refund, that school district must negotiate with the exclusive
representative regarding the refund amount attributable to the proportionate number of
insured lives covered by that exclusive representative.
new text end

new text begin (b) If there is no exclusive representative or if the employer and the exclusive
representative are unable to come to an agreement within 150 days, the remaining refunds
shall be used to pay the full premium to the program for any employees not covered by
an agreement negotiated under this section until the proportionate refunds are depleted.
These refunds shall be used for a proportional premium payment at the time it is necessary
to deplete the balance.
new text end

Sec. 7.

Minnesota Statutes 2013 Supplement, section 124D.10, subdivision 4a, is
amended to read:

Subd. 4a.

Conflict of interest.

(a) An individual is prohibited from serving as a
member of the charter school board of directors if the individual, an immediate family
member, or the individual's partner is a full or part owner or principal with a for-profit or
nonprofit entity or independent contractor with whom the charter school contracts, directly
or indirectly, for professional services, goods, or facilities. An individual is prohibited
from serving as a board member if an immediate family member is an employee of the
school. A violation of this prohibition renders a contract voidable at the option of the
commissioner or the charter school board of directors. A member of a charter school
board of directors who violates this prohibition is individually liable to the charter school
for any damage caused by the violation.

(b) No member of the board of directors, employee, officer, or agent of a charter
school shall participate in selecting, awarding, or administering a contract if a conflict
of interest exists. A conflict exists when:

(1) the board member, employee, officer, or agent;

(2) the immediate family of the board member, employee, officer, or agent;

(3) the partner of the board member, employee, officer, or agent; or

(4) an organization that employs, or is about to employ any individual in clauses
(1) to (3),

has a financial or other interest in the entity with which the charter school is contracting.
A violation of this prohibition renders the contract void.

(c) Any employee, agent, or board member of the authorizer who participates
in the initial review, approval, ongoing oversight, evaluation, or the charter renewal or
nonrenewal process or decision is ineligible to serve on the board of directors of a school
chartered by that authorizer.

(d) An individual may serve as a member of the board of directors if no conflict of
interest under paragraph (a) exists.

(e) The conflict of interest provisions under this subdivision do not apply to
compensation paid to a teacher employed as a teacher by the charter school or a teacher
who provides instructional services to the charter school through a cooperative formed
under chapter 308A when the teacher also serves on the charter school board of directors.

new text begin (f) A charter school board member, employee, or officer must not accept gifts as
defined under section 10A.071, subdivision 1, paragraph (b), and must not request another
person to give a gift to a board member, employee, or officer. A board member, employee,
or officer must not receive compensation from a group health insurance provider.
new text end

Sec. 8.

Minnesota Statutes 2013 Supplement, section 124D.10, subdivision 11, is
amended to read:

Subd. 11.

Employment and other operating matters.

(a) A charter school must
employ or contract with necessary teachers, as defined by section 122A.15, subdivision 1,
who hold valid licenses to perform the particular service for which they are employed in
the school. The charter school's state aid may be reduced under section 127A.43 if the
school employs a teacher who is not appropriately licensed or approved by the board of
teaching. The school may employ necessary employees who are not required to hold
teaching licenses to perform duties other than teaching and may contract for other services.
The school may discharge teachers and nonlicensed employees. The charter school board
is subject to section 181.932. When offering employment to a prospective employee, a
charter school must give that employee a written description of the terms and conditions
of employment and the school's personnel policies.

(b) A person, without holding a valid administrator's license, may perform
administrative, supervisory, or instructional leadership duties. The board of directors shall
establish qualifications for persons that hold administrative, supervisory, or instructional
leadership roles. The qualifications shall include at least the following areas: instruction
and assessment; human resource and personnel management; financial management;
legal and compliance management; effective communication; and board, authorizer, and
community relationships. The board of directors shall use those qualifications as the basis
for job descriptions, hiring, and performance evaluations of those who hold administrative,
supervisory, or instructional leadership roles. The board of directors and an individual
who does not hold a valid administrative license and who serves in an administrative,
supervisory, or instructional leadership position shall develop a professional development
plan. Documentation of the implementation of the professional development plan of these
persons shall be included in the school's annual report.

(c) The board of directors also shall decide and be responsible for policy matters
related to the operation of the school, including budgeting, curriculum programming,
personnel, and operating procedures. The board shall adopt a policy on nepotism in
employment. The board shall adopt personnel evaluation policies and practices that,
at a minimum:

(1) carry out the school's mission and goals;

(2) evaluate the execution of charter contract goals and commitments;

(3) evaluate student achievement, postsecondary and workforce readiness, and
student engagement and connection goals;

(4) establish a teacher evaluation process under subdivision 8, paragraph (t); and

(5) provide professional development related to the individual's job responsibilities.

new text begin (d) A charter school board with at least 25 employees or a teacher cooperative
of licensed teachers providing instruction under a contract between a school and a
cooperative that provides group health insurance coverage shall:
new text end

new text begin (1) request proposals for group insurance coverage from a minimum of three sources
at least every three years; and
new text end

new text begin (2) notify employees covered by the group insurance coverage before the effective
date of the changes in the group coverage policy contract.
new text end

new text begin A charter school board or a cooperative of teachers that provides group insurance
coverage must establish and publish on its Web site the policy for the purchase of group
insurance coverage. A charter school board policy must include a sealed proposal process,
which requires all proposals to be opened at the same time. Upon the openings of the
proposals in accordance with the school or cooperative policy, the proposals become
public data under chapter 13.
new text end

new text begin Nothing in this section supersedes the right of an exclusive representative to
negotiate over terms and conditions of employment.
new text end

Sec. 9.

Minnesota Statutes 2013 Supplement, section 124D.10, subdivision 21, is
amended to read:

Subd. 21.

Collective bargaining.

Employees of the board of directors of a charter
school may, if otherwise eligible, organize under chapter 179A and comply with its
provisions. The board of directors of a charter school is a public employer, for the
purposes of chapter 179A, upon formation of one or more bargaining units at the school.
Bargaining units at the school must be separate from any other units within an authorizing
district, except that bargaining units may remain part of the appropriate unit within an
authorizing district, if the employees of the school, the board of directors of the school, the
exclusive representative of the appropriate unit in the authorizing district, and the board
of the authorizing district agree to include the employees in the appropriate unit of the
authorizing district. new text begin The board of directors of a charter school with employees organized
under this subdivision must comply with sections 471.6161 and 471.895.
new text end

Sec. 10.

Minnesota Statutes 2012, section 471.6161, subdivision 1, is amended to read:

Subdivision 1.

Group insurance coverage.

new text begin For purposes of this section, new text end "group
insurance coverage" means benefit coverage provided to a group through deleted text begin a carrier deleted text end new text begin an
entity new text end authorized under deleted text begin chapters deleted text end new text begin section 43A.316 or 123A.21, subdivision 7; or chapter
new text end 61A, 62A, 62C, deleted text begin and deleted text end new text begin or new text end 62D to do business in the state.

Sec. 11.

Minnesota Statutes 2012, section 471.6161, subdivision 2, is amended to read:

Subd. 2.

Request for proposal.

Every political subdivision authorized by law to
purchase group insurance for its employees and providing or intending to provide group
insurance coverage and benefits for 25 or more of its employees shall request proposals
from and enter into contracts with deleted text begin carriers deleted text end new text begin entities referenced in subdivision 1 new text end that in the
judgment of the political subdivision are best qualified to provide coverage. The request
for proposals shall be in writing and at a minimum shall include: coverage to be provided,
criteria for evaluation of deleted text begin carrier deleted text end proposals new text begin from entities referenced in subdivision 1 new text end , and
the aggregate claims records for the appropriate period. A political subdivision may
exclude from consideration proposals requiring self-insurance. Public notice of the request
for proposals must be provided in a newspaper or trade journal at least 21 days before the
final date for submitting proposals.

Sec. 12.

Minnesota Statutes 2012, section 471.6161, subdivision 3, is amended to read:

Subd. 3.

Selection of carrier.

The political subdivision shall make benefit and
cost comparisons and evaluate the proposals using the written criteria. The political
subdivision may negotiate with deleted text begin the carrier deleted text end new text begin an entity referenced in subdivision 1 new text end on benefits,
premiums, and other contract terms. deleted text begin Carriers applying deleted text end new text begin Any entity providing group
insurance coverage to the political subdivision new text end must provide the political subdivision
with aggregate claims records for the appropriate period. The political subdivision must
prepare a written rationale for its decision before entering into a contract with deleted text begin a carrier deleted text end new text begin an
entity referenced in subdivision 1 new text end .

Sec. 13.

Minnesota Statutes 2012, section 471.6161, is amended by adding a
subdivision to read:

new text begin Subd. 8. new text end

new text begin School districts; group insurance coverage. new text end

new text begin (a) Any entity providing
group insurance coverage to a school district must provide the school district with school
district-specific nonidentifiable aggregate claims records for the most recent 24 months
within 30 days of the request.
new text end

new text begin (b) School districts shall request proposals for group insurance coverage as provided
in subdivision 2 from a minimum of three potential sources of coverage. One of these
requests must go to an administrator governed by chapter 43A. School districts opting
for self-insurance must also follow these provisions, except as provided in paragraph
(g). School districts must make requests for proposals 150 days prior to the expiration
of the existing contract but not more frequently than every 24 months. The request for
proposals must include the most recently available 24 months of nonidentifiable aggregate
claims data. The request for proposals must be publicly released at or prior to its release
to potential bidders.
new text end

new text begin (c) Entities referenced in subdivision 1:
new text end

new text begin (1) must submit renewal premium rates to school districts and exclusive
representatives of employees at least 90 days before the effective date of the premium
rate change; and
new text end

new text begin (2) must submit any proposed plan design changes to school districts and employees
at least 90 days before the effective date to ensure proper negotiations with bargaining units.
new text end

new text begin (d) School district contracts for group insurance must not be longer than two years
unless the exclusive representative of the largest employment group and the school
district agree otherwise.
new text end

new text begin (e) All proposals and renewals shall be sealed upon receipt until they are all opened 90
days prior to the plan's renewal date. The proposals shall be opened on the first business day
after the 90-day deadline in the presence of the exclusive representative, where applicable.
new text end

new text begin (f) Notwithstanding any other law to the contrary, a school board may continue to
negotiate with up to two of the bidders in order to reduce costs or improve services. The
choice of bidders must be agreed to by the exclusive representative of the largest group
of employees.
new text end

new text begin (g) School districts opting for self-insurance shall follow all of the requirements of
this section, except that:
new text end

new text begin (1) their requests for proposals may be for third-party administrator services, where
applicable;
new text end

new text begin (2) these requests for proposals must be from a minimum of two providers;
new text end

new text begin (3) for purposes of fulfilling the requirement to request a proposal for group
insurance coverage from an administrator governed by chapter 43A, self-insured districts
are not required to include in the request for proposal the coverage to be provided;
new text end

new text begin (4) requests for proposals must be sent to providers no less than 90 days prior to
the expiration of the existing contract; and
new text end

new text begin (5) proposals must be submitted at least 60 days prior to the plan's renewal date
and all proposals shall be opened at the same time and in the presence of the exclusive
representative, where applicable.
new text end

Sec. 14.

Minnesota Statutes 2012, section 471.895, subdivision 1, is amended to read:

Subdivision 1.

Definitions.

(a) The definitions in this subdivision apply to this
section.

(b) "Gift" has the meaning given it in section 10A.071, subdivision 1.

(c) "Interested person" means a person or a representative of a person or association
that has a direct financial interest in a decision that a local official is authorized to make.

(d) "Local official" means new text begin :
new text end

new text begin (1) new text end an elected or appointed official of a county or city or of an agency, authority,
or instrumentality of a county or city new text begin ; and
new text end

new text begin (2) an elected or appointed member of a school board, a school superintendent, a
school principal, or a district school officer of any independent school district new text end .

Sec. 15. new text begin EFFECTIVE DATE.
new text end

new text begin Sections 1 to 14 are effective July 1, 2014.
new text end