Minnesota Legislature
SF 2003
as introduced - 89th Legislature (2015 - 2016) Posted on 03/27/2015 09:15am
Current Version - as introduced
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A bill for an act
relating to human services; modifying the administrative cost limit for prepaid
health plans and county-based purchasing plans; amending Minnesota Statutes
2014, section 256B.69, subdivision 5i.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:
Section 1.
Minnesota Statutes 2014, section 256B.69, subdivision 5i, is amended to read:
Subd. 5i.
Administrative expenses.
(a) Managed care plan and county-based
purchasing plan administrative costs for a prepaid health plan provided under this section
or section 256B.692 must not exceed deleted text begin by more than fivedeleted text end new text begin ...new text end percentnew text begin ofnew text end that prepaid health
plan's or county-based purchasing plan's actual deleted text begin calculated administrative spending for the
previous calendar year as a percentage of total revenuedeleted text end new text begin medical expensesnew text end . The penalty for
exceeding this limit must be the amount of administrative spending in excess of deleted text begin 105deleted text end new text begin the ...new text end
percent deleted text begin of the actual calculated amountdeleted text end new text begin limitnew text end . The commissioner may waive this penalty
if the excess administrative spending is the result of unexpected shifts in enrollment or
member needs or new program requirements.
(b) The following expenses are not allowable administrative expenses for rate-setting
purposes under this section:
(1) charitable contributions made by the managed care plan or the county-based
purchasing plan;
(2) any portion of an individual's compensation in excess of $200,000 paid by the
managed care plan or county-based purchasing plan;
(3) any penalties or fines assessed against the managed care plan or county-based
purchasing plan; and
(4) any indirect marketing or advertising expenses of the managed care plan or
county-based purchasing plan.
For the purposes of this subdivision, compensation includes salaries, bonuses and
incentives, other reportable compensation on an IRS 990 form, retirement and other
deferred compensation, and nontaxable benefits.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective July 1, 2015.
new text end