Minnesota Legislature
SF 2533
as introduced - 88th Legislature (2013 - 2014) Posted on 03/13/2014 09:45am
Current Version - as introduced
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A bill for an act
relating to insurance; specifying geographical considerations in regard to
implementing and adjusting the Affordable Care Act in this state; appropriating
money; amending Minnesota Statutes 2013 Supplement, sections 62A.65,
subdivision 3; 62K.10, subdivisions 2, 3.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:
Section 1.
Minnesota Statutes 2013 Supplement, section 62A.65, subdivision 3,
is amended to read:
Subd. 3.
Premium rate restrictions.
No individual health plan may be offered,
sold, issued, or renewed to a Minnesota resident unless the premium rate charged is
determined in accordance with the following requirements:
(a) Premium rates may vary based upon the ages of covered persons in accordance
with the provisions of the Affordable Care Act.
(b) Premium rates may vary based upon geographic rating area. The commissioner
shall grant approval if the following conditions are met:
(1) the areas are established in accordance with the Affordable Care Act;
(2) each geographic region must new text begin contain populations that do not vary from each
other by more than 400 percent and new text end be composed of no fewer than seven counties that
create a contiguous regionnew text begin , except that the two largest counties in the state by population
may constitute one entire regionnew text end ; deleted text begin and
deleted text end
(3) the health carrier provides actuarial justification acceptable to the commissioner
for the proposed geographic variations in premium rates for each area, establishing that
the variations are based upon differences in the cost to the health carrier of providing
coveragedeleted text begin .deleted text end new text begin ; and
new text end
new text begin
(4) the maximum aggregate premium ratio of the highest cost geographic region
to the lowest cost geographic region does not exceed 1.5.
new text end
(c) Premium rates may vary based upon tobacco use, in accordance with the
provisions of the Affordable Care Act.
(d) In developing its premiums for a health plan, a health carrier shall take into
account only the following factors:
(1) actuarially valid differences in rating factors permitted under paragraphs (a)
and (c); and
(2) actuarially valid geographic variations if approved by the commissioner as
provided in paragraph (b).
(e) The premium charged with respect to any particular individual health plan shall
not be adjusted more frequently than annually or January 1 of the year following initial
enrollment, except that the premium rates may be changed to reflect:
(1) changes to the family composition of the policyholder;
(2) changes in geographic rating area of the policyholder, as provided in paragraph
(b);
(3) changes in age, as provided in paragraph (a);
(4) changes in tobacco use, as provided in paragraph (c);
(5) transfer to a new health plan requested by the policyholder; or
(6) other changes required by or otherwise expressly permitted by state or federal
law or regulations.
(f) All premium variations must be justified in initial rate filings and upon request of
the commissioner in rate revision filings. All rate variations are subject to approval by
the commissioner.
(g) The loss ratio must comply with the section 62A.021 requirements for individual
health plans.
(h) The rates must not be approved, unless the commissioner has determined that the
rates are reasonable. In determining reasonableness, the commissioner shall consider the
growth rates applied under section 62J.04, subdivision 1, paragraph (b), to the calendar
year or years that the proposed premium rate would be in effect and actuarially valid
changes in risks associated with the enrollee populations.
(i) A health carrier may, as part of a minimum lifetime loss ratio guarantee filing
under section 62A.02, subdivision 3a, include a rating practices guarantee as provided in
this paragraph. The rating practices guarantee must be in writing and must guarantee that
the policy form will be offered, sold, issued, and renewed only with premium rates and
premium rating practices that comply with subdivisions 2, 3, 4, and 5. The rating practices
guarantee must be accompanied by an actuarial memorandum that demonstrates that the
premium rates and premium rating system used in connection with the policy form will
satisfy the guarantee. The guarantee must guarantee refunds of any excess premiums to
policyholders charged premiums that exceed those permitted under subdivision 2, 3, 4, or
5. A health carrier that complies with this paragraph in connection with a policy form is
exempt from the requirement of prior approval by the commissioner under paragraphs
(b), (f), and (h).
(j) The commissioner may establish regulations to implement the provisions of
this subdivision.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective May 1, 2014, or upon federal
approval, whichever is later.
new text end
Sec. 2.
Minnesota Statutes 2013 Supplement, section 62K.10, subdivision 2, is
amended to read:
Subd. 2.
Primary care; mental health services; general hospital services.
new text begin (a)
new text end The maximum travel distance or time shall be the lesser of 30 miles or 30 minutes to the
nearest provider of each of the following services: primary care services, mental health
services, and general hospital services.
new text begin
(b) In any geographic region, as defined by section 62A.65, subdivision 3, where the
average aggregate premiums exceeded those available in the lowest cost region by at least
50 percent in 2014, the maximum travel distance or time may be the lesser of 75 miles
or 75 minutes to the nearest in-network or contracted provider of each of the following
services: primary care services, mental health services, and general hospital services.
new text end
new text begin
(c) A health plan may offer a qualified health plan under paragraph (b) only if it
also offers at least one qualified health plan in the same region that complies with the
requirements of paragraph (a).
new text end
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective May 1, 2014.
new text end
Sec. 3.
Minnesota Statutes 2013 Supplement, section 62K.10, subdivision 3, is
amended to read:
Subd. 3.
Other health services.
new text begin (a) new text end The maximum travel distance or time shall be
the lesser of 60 miles or 60 minutes to the nearest provider of specialty physician services,
ancillary services, specialized hospital services, and all other health services not listed in
subdivision 2.
new text begin
(b) In any geographic region, as defined by section 62A.65, subdivision 3, where
the average aggregate premiums exceeded those available in the lowest cost region by
at least 50 percent in 2014, the maximum travel distance or time shall be the lesser of
100 miles or 100 minutes to the nearest in-network or contracted provider of specialty
physician services, ancillary services, specialized hospital services, and all other health
services not listed in subdivision 2.
new text end
new text begin
(c) A health plan may offer a qualified health plan under paragraph (b) only if it
also offers at least one qualified health plan in the same region that complies with the
requirements of paragraph (a).
new text end
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective May 1, 2014.
new text end
Sec. 4. new text begin EVALUATION OF ALL-PAYER RATE SETTING SYSTEM.
new text end
new text begin
(a) No later than December 15, 2014, the commissioners of health, commerce, and
human services shall issue a report to the legislature evaluating the potential costs and
benefits of an all-payer rate setting system to determine provider payments made under
all private and public sector health plans. The evaluation report must analyze the impact
of establishing:
new text end
new text begin
(1) uniform payment rates for specific health care procedures and services that do
not vary by health plan or payer type or within provider type;
new text end
new text begin
(2) uniform payment rates for specific health care provider types that are reimbursed
under capitated or total cost of care payment methods that do not vary by health plan
or payer type; and
new text end
new text begin
(3) procedures for determining and approving periodic increases in provider payment
rates that do not vary by health plan or payer type, and that reflect increases in costs
incurred by efficient and high-quality providers.
new text end
new text begin
(b) As part of the evaluation report in paragraph (a), the commissioner of human
services shall estimate the fiscal impact to payments under the medical assistance and
MinnesotaCare programs as a result of the implementation of an all-payer rate setting
system.
new text end
new text begin
(c) As part of the evaluation report in paragraph (a), the commissioner of commerce
shall estimate the impact on private insurance market premium rates as a result of the
implementation of an all-payer rate setting system.
new text end
new text begin
(d) In conducting this evaluation, the commissioners must consult with
representatives of health plan companies, health care providers, a sample set of typical
health care consumers, and state agencies and other payers. Any written responses
received from these stakeholders must be included as an appendix to the report.
new text end
Sec. 5. new text begin NETWORK ADEQUACY STANDARDS PROPOSAL.
new text end
new text begin
No later than December 15, 2014, the commissioner of health shall investigate
and propose to the legislature a set of revised standards for provider network adequacy,
as defined by section 62K.10. The revised standards shall assess the impact of any such
revision on regional provider pricing disparities for identical treatments and services, health
insurance product premiums, and the affordability of health insurance for consumers.
new text end
Sec. 6. new text begin SINGLE GEOGRAPHIC RATE AREA STUDY.
new text end
new text begin
As part of the public release of rates for qualified health plans available starting
January 1, 2015, the commissioner of commerce shall report the likely impact on premium
rates in each region as a result of establishing a single geographic rating area for the entire
state of Minnesota for plans available starting January 1, 2016.
new text end
Sec. 7. new text begin APPROPRIATION.
new text end
new text begin
$450,000 in fiscal year 2015 is appropriated from the general fund, of which $.......
is appropriated to the commissioner of health, $....... to the commissioner of commerce,
and $....... to the commissioner of human services, for the evaluation reports described in
section 4.
new text end