SF 1859

as introduced - 89th Legislature (2015 - 2016) Posted on 08/24/2015 10:32am

A bill for an act
relating to insurance; amending provisions relating to health coverage for school
district employees; amending Minnesota Statutes 2014, section 471.6161,
subdivisions 3, 8.

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

Section 1.

Minnesota Statutes 2014, section 471.6161, subdivision 3, is amended to read:

Subd. 3.

Selection of carrier.

new text begin (a) new text end The political subdivision shall make benefit
and cost comparisons and evaluate the proposals using the written criteria. The political
subdivision may negotiate with an entity referenced in subdivision 1 on benefits,
premiums, and other contract terms. Any entity providing group insurance coverage to the
political subdivision 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 an entity referenced in subdivision 1.

new text begin (b) School districts shall post the written rationale described in paragraph (a) on the
school district Web site for 60 days, beginning the day after the contract is executed. The
written rationale must include a description of the negotiation of the contract between the
school district and entity, and the reasons the entity is the best qualified to provide coverage.
new text end

new text begin (c) The Department of Education shall post the written rationale prepared by a
school district under paragraph (b) on its Web site for 60 days, beginning upon receipt of
notice from the school district that the written rationale has been prepared.
new text end

Sec. 2.

Minnesota Statutes 2014, section 471.6161, subdivision 8, is amended to read:

Subd. 8.

School districts; group health insurance coverage.

(a) Any entity
providing group health 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.

(b) School districts shall request proposals for group health insurance coverage
as provided in subdivision 2 from deleted text begin a minimum of three potential sources of coverage.
One of these requests must go to deleted text end new text begin all of the entities that are doing business, as of the date
the requests are sent, in the county in which any part of that school district is located.
These requests for proposals include requests to new text end an administrator governed by chapter
43A. Entities referenced in subdivision 1 must respond to requests for proposals received
directly from a school district. School districts that are self-insured must also follow these
provisions, except as provided in paragraph (f). School districts must make requests for
proposals at least 150 days prior to the expiration of the existing contract but not more
frequently than once 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 sources of coverage.

(c) School district contracts for group health insurance must not be longer than
two years unless the exclusive representative of the largest employment group and the
school district agree otherwise.

(d) All initial proposals shall be sealed upon receipt until they are all opened no less
than 90 days prior to the plan's renewal date in the presence of up to three representatives
selected by the exclusive representative of the largest group of employees. Section 13.591,
subdivision 3, paragraph (b), applies to data in the proposals. The representatives of
the exclusive representative must maintain the data according to this classification and
are subject to the remedies and penalties under sections 13.08 and 13.09 for a violation
of this requirement. new text begin A school district shall not allow an interested person as defined in
section 471.895, subdivision 1, paragraph (c), to view the proposals until such time as
the proposals become public data.
new text end

(e) A school district, in consultation with the same representatives referenced in
paragraph (d), may continue to negotiate with any entity that submitted a proposal under
paragraph (d) in order to reduce costs or improve services under the proposal. Following
the negotiations any entity that submitted an initial proposal may submit a final proposal
incorporating the negotiations, which is due no less than 75 days prior to the plan's
renewal date. All the final proposals submitted must be opened at the same time in the
presence of up to three representatives selected by the exclusive representative of the
largest group of employees. Notwithstanding section 13.591, subdivision 3, paragraph (b),
following the opening of the final proposals, all the proposals, including any made under
paragraph (d), and other data submitted in connection with the proposals are public data.
The school district may choose from any of the initial or final proposals without further
negotiations and in accordance with subdivision 5, but not sooner than 15 days after
the proposals become public data.

(f) School districts that are self-insured shall follow all of the requirements of this
section, except that:

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

(2) these requests for proposals must be from a minimum of three different sources,
which may include both entities referenced in subdivision 1 and providers of third-party
administrator services;

(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;

(4) a district that is self-insured on or before the date of enactment, or that is
self-insured with more than 1,000 insured lives, or a district in which the school board
adopted a motion on or before May 14, 2014, to approve a self-insured health care plan
to be effective July 1, 2014, may, but need not, request a proposal from an administrator
governed by chapter 43A;

(5) requests for proposals must be sent to providers no less than 90 days prior to
the expiration of the existing contract; and

(6) 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.

(g) Nothing in this section shall restrict the authority granted to school district boards
of education by section 471.59, except that districts will not be considered self-insured for
purposes of this subdivision solely through participation in a joint powers arrangement. new text begin
School district employees who are also board members serving on a board created pursuant
to section 471.59, or employees of the board, shall not have access to initial or final
proposals under paragraphs (d) and (e) until such time as the proposals become public data.
new text end

(h) An entity providing group health insurance to a school district under a multiyear
contract must give notice of any rate or plan design changes applicable under the contract
at least 90 days before the effective date of any change. The notice must be given to the
school district and to the exclusive representatives of employees. new text begin If the rate increase is
higher than eight percent, then:
new text end

new text begin (1) the school district must seek a proposal within five days of receiving such notice
from an administrator governed by chapter 43A;
new text end

new text begin (2) exclusive representatives are deemed to have met the requirements of section
43A.316, subdivision 5, paragraph (b);
new text end

new text begin (3) if an exclusive representative determines that the represented employees must
participate, the school district must transfer its insurance contributions for the represented
employees to the public employees insurance program under section 43A.316, upon the
beginning of the plan year; and
new text end

new text begin (4) the school district must not transfer to the represented employees any penalties
or cost increases that are assessed by the entity that was providing group health insurance
coverage due to a transfer of insurance contributions to the public employees insurance
program.
new text end

Sec. 3. new text begin EFFECTIVE DATE.
new text end

new text begin Section 1 is effective the day following final enactment. Section 2 is effective the
day following final enactment and applies to requests for proposals for group health
insurance coverage issued on or after that date.
new text end