1.1                                        A bill for an act&#10;1.2     relating to commerce; regulating license education; regulating certain insurers, &#10;1.3     insurance forms, rates, minimum loss ratio guarantees, coverages, purchases, &#10;1.4     disclosures, filings, utilization reviews, and claims; enacting an interstate &#10;1.5     insurance product regulation compact; regulating the Minnesota uniform health &#10;1.6     care identification card; requiring health care provider pricing transparency; &#10;1.7     regulating charity care; requiring certain reports;amending Minnesota Statutes &#10;1.8     2004, sections 61A.02, subdivision 3; 61A.092, subdivision 3; 62A.02, &#10;1.9     subdivision 3, by adding a subdivision; 62A.021, subdivision 1; 62A.095, &#10;1.10    subdivision 1; 62A.27; 62A.3093; 62A.65, subdivision 3; 62C.14, subdivisions &#10;1.11    9, 10; 62E.13, subdivision 3; 62E.14, subdivision 5; 62J.60, subdivisions 2, 3; &#10;1.12    62J.81, subdivision 1; 62L.02, subdivision 24; 62L.03, subdivision 3; 62L.08, &#10;1.13    subdivision 4; 62M.01, subdivision 2; 62M.09, subdivision 9; 62S.05, by &#10;1.14    adding a subdivision; 62S.08, subdivision 3; 62S.081, subdivision 4; 62S.10, &#10;1.15    subdivision 2; 62S.13, by adding a subdivision; 62S.14, subdivision 2; 62S.15; &#10;1.16    62S.20, subdivision 1; 62S.24, subdivisions 1, 3, 4, by adding subdivisions; &#10;1.17    62S.25, subdivision 6, by adding a subdivision; 62S.26; 62S.266, subdivision &#10;1.18    2; 62S.29, subdivision 1; 62S.30; 65B.44, subdivision 3a; 70A.07; 72A.20, by &#10;1.19    adding a subdivision; 72C.10, subdivision 1; 79.01, by adding subdivisions; &#10;1.20    79.251, subdivision 1, by adding a subdivision; 79.252, by adding subdivisions; &#10;1.21    79A.23, subdivision 3; 79A.32; 123A.21, subdivision 7, by adding a subdivision; &#10;1.22    Minnesota Statutes 2005 Supplement, sections 45.22; 45.23; 62A.316; &#10;1.23    62J.052; 62L.12, subdivision 2; 72A.201, subdivision 6; 79A.04, subdivision &#10;1.24    2; 256B.0571;  Laws 2005, First Special Session chapter 4, article 7, section &#10;1.25    59; proposing coding for new law in Minnesota Statutes, chapters 60A; 62A; &#10;1.26    62J; 62M; 62Q; 62S; repealing Minnesota Statutes 2005 Supplement, section &#10;1.27    62Q.251; Minnesota Rules, parts 2781.0100; 2781.0200; 2781.0300; 2781.0400; &#10;1.28    2781.0500; 2781.0600.&#10;1.29    BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:&#10;&#10;<a id="go.0.1.0"></a>1.30        Section 1. Minnesota Statutes 2005 Supplement, section 45.22, is amended to read:&#10;1.31    <b>45.22 LICENSE EDUCATION APPROVAL.</b>&#10;1.32    <del>(a)</del> License education courses must be approved in advance by the commissioner. &#10;1.33    Each sponsor who offers a license education course must <del>have at least one coordinator, </del>&#10;2.1     <del>approved by the commissioner,</del><ins> be approved by the commissioner. Each approved </ins>&#10;2.2     <ins>sponsor must have at least one coordinator who meets the criteria specified in Minnesota </ins>&#10;2.3     <ins>Rules, chapter 2809, and</ins> who is responsible for supervising the educational program &#10;2.4     and assuring compliance with all laws and rules. "Sponsor" means any person or entity &#10;2.5     offering approved education.&#10;2.6     <del>(b) For coordinators with an initial approval date before August 1, 2005, approval </del>&#10;2.7     <del>will expire on December 31, 2005. </del>For courses with an initial approval date on or before &#10;2.8     December 31, 2000, approval will expire on April 30, 2006. For courses with an initial &#10;2.9     approval date after January 1, 2001, but before August 1, 2005, approval will expire &#10;2.10    on April 30, 2007.&#10;&#10;<a id="go.0.2.0"></a>2.11        Sec. 2. Minnesota Statutes 2005 Supplement, section 45.23, is amended to read:&#10;2.12    <b>45.23 LICENSE EDUCATION FEES.</b>&#10;2.13    The following fees must be paid to the commissioner:&#10;2.14    (1) initial course approval, $10 for each hour or fraction of one hour of education &#10;2.15    course approval sought. Initial course approval expires on the last day of the 24th month &#10;2.16    after the course is approved;&#10;2.17    (2) renewal of course approval, $10 per course. Renewal of course approval expires &#10;2.18    on the last day of the 24th month after the course is renewed;&#10;2.19    (3) initial <del>coordinator</del><ins> sponsor</ins> approval, $100. <del>Initial coordinator approval expires </del>&#10;2.20    <del>on the last day of the 24th month after the coordinator is approved; </del><ins> Initial sponsor </ins>&#10;2.21    <ins>approval issued under this section is valid for a period not to exceed 24 months and </ins>&#10;2.22    <ins>expires on January 31 of the renewal year assigned by the commissioner. Active sponsors </ins>&#10;2.23    <ins>who have at least one approved coordinator as of the effective date of this section are </ins>&#10;2.24    <ins>deemed to be approved sponsors and are not required to submit an initial application </ins>&#10;2.25    <ins>for sponsor approval;</ins> and&#10;2.26    (4) renewal of <del>coordinator</del><ins> sponsor</ins> approval, $10. <del>Renewal of coordinator approval </del>&#10;2.27    <del>expires on the last day of the 24th month after the coordinator is renewed.</del><ins> Each renewal </ins>&#10;2.28    <ins>of sponsor approval is valid for a period of 24 months. Active sponsors who have at least </ins>&#10;2.29    <ins>one approved coordinator as of the effective date of this section will have an expiration </ins>&#10;2.30    <ins>date of January 31, 2008.</ins>&#10;2.31    <ins><b>EFFECTIVE DATE.</b></ins><ins>This section is effective the day following final enactment.</ins>&#10;&#10;<a id="go.0.3.0"></a>2.32        Sec. 3. <ins><b>[60A.99] INTERSTATE INSURANCE PRODUCT REGULATION </b></ins>&#10;2.33    <ins><b>COMPACT.</b></ins>&#10;3.1         <ins>Subdivision 1.</ins> <ins><b>Enactment and form.</b></ins> <ins>The Interstate Insurance Product Regulation </ins>&#10;3.2     <ins>Compact is enacted into law and entered into with all other states legally joining in it in </ins>&#10;3.3     <ins>substantially the following form:</ins>&#10;3.4     <ins>Article I. Purposes</ins>&#10;3.5     <ins>The purposes of this Compact are, through means of joint and cooperative action </ins>&#10;3.6     <ins>among the Compacting States:</ins>&#10;3.7     <ins>1. To promote and protect the interest of consumers of individual and group annuity, </ins>&#10;3.8     <ins>life insurance, disability income and long-term care insurance products;</ins>&#10;3.9     <ins>2. To develop uniform standards for insurance products covered under the Compact;</ins>&#10;3.10    <ins>3. To establish a central clearinghouse to receive and provide prompt review of </ins>&#10;3.11    <ins>insurance products covered under the Compact and, in certain cases, advertisements related </ins>&#10;3.12    <ins>thereto, submitted by insurers authorized to do business in one or more Compacting States;</ins>&#10;3.13    <ins>4. To give appropriate regulatory approval to those product filings and </ins>&#10;3.14    <ins>advertisements satisfying the applicable uniform standard;</ins>&#10;3.15    <ins>5. To improve coordination of regulatory resources and expertise between state </ins>&#10;3.16    <ins>insurance departments regarding the setting of uniform standards and review of insurance </ins>&#10;3.17    <ins>products covered under the Compact;</ins>&#10;3.18    <ins>6. To create the Interstate Insurance Product Regulation Commission; and</ins>&#10;3.19    <ins>7. To perform these and such other related functions as may be consistent with the </ins>&#10;3.20    <ins>state regulation of the business of insurance.</ins>&#10;3.21    <ins>Article II. Definitions</ins>&#10;3.22    <ins>For purposes of this Compact:</ins>&#10;3.23    <ins>1. "Advertisement" means any material designed to create public interest in </ins>&#10;3.24    <ins>a Product, or induce the public to purchase, increase, modify, reinstate, borrow on, </ins>&#10;3.25    <ins>surrender, replace or retain a policy, as more specifically defined in the Rules and </ins>&#10;3.26    <ins>Operating Procedures of the Commission.</ins>&#10;3.27    <ins>2. "Bylaws" mean those bylaws established by the Commission for its governance, </ins>&#10;3.28    <ins>or for directing or controlling the Commission's actions or conduct.</ins>&#10;3.29    <ins>3. "Compacting State" means any State which has enacted this Compact legislation </ins>&#10;3.30    <ins>and which has not withdrawn pursuant to Article XIV, Section 1, or been terminated </ins>&#10;3.31    <ins>pursuant to Article XIV, Section 2.</ins>&#10;3.32    <ins>4. "Commission" means the "Interstate Insurance Product Regulation Commission" </ins>&#10;3.33    <ins>established by this Compact.</ins>&#10;3.34    <ins>5. "Commissioner" means the chief insurance regulatory official of a State including, </ins>&#10;3.35    <ins>but not limited to commissioner, superintendent, director or administrator.</ins>&#10;4.1     <ins>6. "Domiciliary State" means the state in which an Insurer is incorporated or </ins>&#10;4.2     <ins>organized; or, in the case of an alien Insurer, its state of entry.</ins>&#10;4.3     <ins>7. "Insurer" means any entity licensed by a State to issue contracts of insurance for </ins>&#10;4.4     <ins>any of the lines of insurance covered by this Act.</ins>&#10;4.5     <ins>8. "Member" means the person chosen by a Compacting State as its representative </ins>&#10;4.6     <ins>to the Commission, or his or her designee.</ins>&#10;4.7     <ins>9. "Noncompacting State" means any State which is not at the time a Compacting </ins>&#10;4.8     <ins>State.</ins>&#10;4.9     <ins>10. "Operating Procedures" mean procedures promulgated by the Commission </ins>&#10;4.10    <ins>implementing a Rule, Uniform Standard, or a provision of this Compact.</ins>&#10;4.11    <ins>11. "Product" means the form of a policy or contract, including any application, </ins>&#10;4.12    <ins>endorsement, or related form which is attached to and made a part of the policy or </ins>&#10;4.13    <ins>contract, and any evidence of coverage or certificate, for an individual or group annuity, </ins>&#10;4.14    <ins>life insurance, disability income or long-term care insurance product that an Insurer is </ins>&#10;4.15    <ins>authorized to issue.</ins>&#10;4.16    <ins>12. "Rule" means a statement of general or particular applicability and future effect </ins>&#10;4.17    <ins>promulgated by the Commission, including a Uniform Standard developed pursuant to </ins>&#10;4.18    <ins>Article VII of this Compact, designed to implement, interpret, or prescribe law or policy </ins>&#10;4.19    <ins>or describing the organization, procedure, or practice requirements of the Commission, </ins>&#10;4.20    <ins>which shall have the force and effect of law in the Compacting States.</ins>&#10;4.21    <ins>13. "State" means any state, district, or territory of the United States of America.</ins>&#10;4.22    <ins>14. "Third Party Filer" means an entity that submits a Product filing to the </ins>&#10;4.23    <ins>Commission on behalf of an Insurer.</ins>&#10;4.24    <ins>15. "Uniform Standard" means a standard adopted by the Commission for a </ins>&#10;4.25    <ins>Product line, pursuant to Article VII of this Compact, and shall include all of the Product </ins>&#10;4.26    <ins>requirements in aggregate; provided, that each Uniform Standard shall be construed, </ins>&#10;4.27    <ins>whether express or implied, to prohibit the use of any inconsistent, misleading or </ins>&#10;4.28    <ins>ambiguous provisions in a Product and the form of the Product made available to the public </ins>&#10;4.29    <ins>shall not be unfair, inequitable or against public policy as determined by the Commission.</ins>&#10;4.30    <ins>Article III. Establishment of the Commission and Venue</ins>&#10;4.31    <ins>1. The Compacting States hereby create and establish a joint public agency known </ins>&#10;4.32    <ins>as the "Interstate Insurance Product Regulation Commission." Pursuant to Article IV, </ins>&#10;4.33    <ins>the Commission will have the power to develop Uniform Standards for Product lines, </ins>&#10;4.34    <ins>receive and provide prompt review of Products filed therewith, and give approval to those </ins>&#10;4.35    <ins>Product filings satisfying applicable Uniform Standards; provided, it is not intended for </ins>&#10;4.36    <ins>the Commission to be the exclusive entity for receipt and review of insurance product </ins>&#10;5.1     <ins>filings. Nothing herein shall prohibit any Insurer from filing its product in any State </ins>&#10;5.2     <ins>wherein the Insurer is licensed to conduct the business of insurance; and any such filing </ins>&#10;5.3     <ins>shall be subject to the laws of the State where filed.</ins>&#10;5.4     <ins>2. The Commission is a body corporate and politic, and an instrumentality of the </ins>&#10;5.5     <ins>Compacting States.</ins>&#10;5.6     <ins>3. The Commission is solely responsible for its liabilities except as otherwise </ins>&#10;5.7     <ins>specifically provided in this Compact.</ins>&#10;5.8     <ins>4. Venue is proper and judicial proceedings by or against the Commission shall be </ins>&#10;5.9     <ins>brought solely and exclusively in a Court of competent jurisdiction where the principal </ins>&#10;5.10    <ins>office of the Commission is located.</ins>&#10;5.11    <ins>Article IV. Powers of the Commission</ins>&#10;5.12    <ins>The Commission shall have the following powers:</ins>&#10;5.13    <ins>1. To promulgate Rules, pursuant to Article VII of this Compact, which shall have </ins>&#10;5.14    <ins>the force and effect of law and shall be binding in the Compacting States to the extent and </ins>&#10;5.15    <ins>in the manner provided in this Compact;</ins>&#10;5.16    <ins>2. To exercise its rulemaking authority and establish reasonable Uniform Standards </ins>&#10;5.17    <ins>for Products covered under the Compact, and Advertisement related thereto, which </ins>&#10;5.18    <ins>shall have the force and effect of law and shall be binding in the Compacting States, </ins>&#10;5.19    <ins>but only for those Products filed with the Commission, provided, that a Compacting </ins>&#10;5.20    <ins>State shall have the right to opt out of such Uniform Standard pursuant to Article VII, to </ins>&#10;5.21    <ins>the extent and in the manner provided in this Compact, and, provided further, that any </ins>&#10;5.22    <ins>Uniform Standard established by the Commission for long-term care insurance products </ins>&#10;5.23    <ins>may provide the same or greater protections for consumers as, but shall not provide less </ins>&#10;5.24    <ins>than, those protections set forth in the National Association of Insurance Commissioners' </ins>&#10;5.25    <ins>Long-Term Care Insurance Model Act and Long-Term Care Insurance Model Regulation, </ins>&#10;5.26    <ins>respectively, adopted as of 2001. The Commission shall consider whether any subsequent </ins>&#10;5.27    <ins>amendments to the NAIC Long-Term Care Insurance Model Act or Long-Term Care </ins>&#10;5.28    <ins>Insurance Model Regulation adopted by the NAIC require amending of the Uniform </ins>&#10;5.29    <ins>Standards established by the Commission for long-term care insurance products;</ins>&#10;5.30    <ins>3. To receive and review in an expeditious manner Products filed with the </ins>&#10;5.31    <ins>Commission, and rate filings for disability income and long-term care insurance Products, </ins>&#10;5.32    <ins>and give approval of those Products and rate filings that satisfy the applicable Uniform </ins>&#10;5.33    <ins>Standard, where such approval shall have the force and effect of law and be binding on the </ins>&#10;5.34    <ins>Compacting States to the extent and in the manner provided in the Compact;</ins>&#10;5.35    <ins>4. To receive and review in an expeditious manner Advertisement relating to </ins>&#10;5.36    <ins>long-term care insurance products for which Uniform Standards have been adopted by </ins>&#10;6.1     <ins>the Commission, and give approval to all Advertisement that satisfies the applicable </ins>&#10;6.2     <ins>Uniform Standard. For any product covered under this Compact, other than long-term </ins>&#10;6.3     <ins>care insurance products, the Commission shall have the authority to require an insurer </ins>&#10;6.4     <ins>to submit all or any part of its Advertisement with respect to that product for review or </ins>&#10;6.5     <ins>approval prior to use, if the Commission determines that the nature of the product is such </ins>&#10;6.6     <ins>that an Advertisement of the product could have the capacity or tendency to mislead the </ins>&#10;6.7     <ins>public. The actions of the Commission as provided in this section shall have the force </ins>&#10;6.8     <ins>and effect of law and shall be binding in the Compacting States to the extent and in the </ins>&#10;6.9     <ins>manner provided in the Compact;</ins>&#10;6.10    <ins>5. To exercise its rulemaking authority and designate Products and Advertisement </ins>&#10;6.11    <ins>that may be subject to a self-certification process without the need for prior approval </ins>&#10;6.12    <ins>by the Commission;</ins>&#10;6.13    <ins>6. To promulgate Operating Procedures, pursuant to Article VII of this Compact, </ins>&#10;6.14    <ins>which shall be binding in the Compacting States to the extent and in the manner provided </ins>&#10;6.15    <ins>in this compact;</ins>&#10;6.16    <ins>7. To bring and prosecute legal proceedings or actions in its name as the </ins>&#10;6.17    <ins>Commission; provided, that the standing of any state insurance department to sue or be </ins>&#10;6.18    <ins>sued under applicable law shall not be affected;</ins>&#10;6.19    <ins>8. To issue subpoenas requiring the attendance and testimony of witnesses and the </ins>&#10;6.20    <ins>production of evidence;</ins>&#10;6.21    <ins>9. To establish and maintain offices;</ins>&#10;6.22    <ins>10. To purchase and maintain insurance and bonds;</ins>&#10;6.23    <ins>11. To borrow, accept or contract for services of personnel, including, but not limited </ins>&#10;6.24    <ins>to, employees of a Compacting State;</ins>&#10;6.25    <ins>12. To hire employees, professionals or specialists, and elect or appoint officers, and </ins>&#10;6.26    <ins>to fix their compensation, define their duties and give them appropriate authority to carry </ins>&#10;6.27    <ins>out the purposes of the Compact, and determine their qualifications; and to establish the </ins>&#10;6.28    <ins>Commission's personnel policies and programs relating to, among other things, conflicts </ins>&#10;6.29    <ins>of interest, rates of compensation and qualifications of personnel;</ins>&#10;6.30    <ins>13. To accept any and all appropriate donations and grants of money, equipment, </ins>&#10;6.31    <ins>supplies, materials and services, and to receive, utilize and dispose of the same; provided </ins>&#10;6.32    <ins>that at all times the Commission shall strive to avoid any appearance of impropriety;</ins>&#10;6.33    <ins>14. To lease, purchase, accept appropriate gifts or donations of, or otherwise to own, </ins>&#10;6.34    <ins>hold, improve or use, any property, real, personal or mixed; provided that at all times the </ins>&#10;6.35    <ins>Commission shall strive to avoid any appearance of impropriety;</ins>&#10;7.1     <ins>15. To sell, convey, mortgage, pledge, lease, exchange, abandon or otherwise </ins>&#10;7.2     <ins>dispose of any property, real, personal or mixed;</ins>&#10;7.3     <ins>16. To remit filing fees to Compacting States as may be set forth in the Bylaws, </ins>&#10;7.4     <ins>Rules or Operating Procedures;</ins>&#10;7.5     <ins>17. To enforce compliance by Compacting States with Rules, Uniform Standards, </ins>&#10;7.6     <ins>Operating Procedures and Bylaws;</ins>&#10;7.7     <ins>18. To provide for dispute resolution among Compacting States;</ins>&#10;7.8     <ins>19. To advise Compacting States on issues relating to Insurers domiciled or doing </ins>&#10;7.9     <ins>business in Noncompacting jurisdictions, consistent with the purposes of this Compact;</ins>&#10;7.10    <ins>20. To provide advice and training to those personnel in state insurance departments </ins>&#10;7.11    <ins>responsible for product review, and to be a resource for state insurance departments;</ins>&#10;7.12    <ins>21. To establish a budget and make expenditures;</ins>&#10;7.13    <ins>22. To borrow money;</ins>&#10;7.14    <ins>23. To appoint committees, including advisory committees comprising Members, </ins>&#10;7.15    <ins>state insurance regulators, state legislators or their representatives, insurance industry </ins>&#10;7.16    <ins>and consumer representatives, and such other interested persons as may be designated </ins>&#10;7.17    <ins>in the Bylaws;</ins>&#10;7.18    <ins>24. To provide and receive information from, and to cooperate with law enforcement </ins>&#10;7.19    <ins>agencies;</ins>&#10;7.20    <ins>25. To adopt and use a corporate seal; and</ins>&#10;7.21    <ins>26. To perform such other functions as may be necessary or appropriate to achieve </ins>&#10;7.22    <ins>the purposes of this Compact consistent with the state regulation of the business of </ins>&#10;7.23    <ins>insurance.</ins>&#10;7.24    <ins>Article V. Organization of the Commission</ins>&#10;7.25    <ins>1. Membership, Voting and Bylaws</ins>&#10;7.26    <ins>a. Each Compacting State shall have and be limited to one Member. Each Member </ins>&#10;7.27    <ins>shall be qualified to serve in that capacity pursuant to applicable law of the Compacting </ins>&#10;7.28    <ins>State. Any Member may be removed or suspended from office as provided by the law </ins>&#10;7.29    <ins>of the State from which he or she shall be appointed. Any vacancy occurring in the </ins>&#10;7.30    <ins>Commission shall be filled in accordance with the laws of the Compacting State wherein </ins>&#10;7.31    <ins>the vacancy exists. Nothing herein shall be construed to affect the manner in which a </ins>&#10;7.32    <ins>Compacting State determines the election or appointment and qualification of its own </ins>&#10;7.33    <ins>Commissioner.</ins>&#10;7.34    <ins>b. Each Member shall be entitled to one vote and shall have an opportunity </ins>&#10;7.35    <ins>to participate in the governance of the Commission in accordance with the Bylaws. </ins>&#10;7.36    <ins>Notwithstanding any provision herein to the contrary, no action of the Commission with </ins>&#10;8.1     <ins>respect to the promulgation of a Uniform Standard shall be effective unless two-thirds of </ins>&#10;8.2     <ins>the Members vote in favor thereof.</ins>&#10;8.3     <ins>c. The Commission shall, by a majority of the Members, prescribe Bylaws to govern </ins>&#10;8.4     <ins>its conduct as may be necessary or appropriate to carry out the purposes, and exercise the </ins>&#10;8.5     <ins>powers, of the Compact, including, but not limited to:</ins>&#10;8.6     <ins>i. Establishing the fiscal year of the Commission;</ins>&#10;8.7     <ins>ii. Providing reasonable procedures for appointing and electing members, as well as </ins>&#10;8.8     <ins>holding meetings, of the Management Committee;</ins>&#10;8.9     <ins>iii. Providing reasonable standards and procedures: (i) for the establishment and </ins>&#10;8.10    <ins>meetings of other committees, and (ii) governing any general or specific delegation of any </ins>&#10;8.11    <ins>authority or function of the Commission;</ins>&#10;8.12    <ins>iv. Providing reasonable procedures for calling and conducting meetings of the </ins>&#10;8.13    <ins>Commission that consist of a majority of Commission members, ensuring reasonable </ins>&#10;8.14    <ins>advance notice of each such meeting and providing for the right of citizens to attend each </ins>&#10;8.15    <ins>such meeting with enumerated exceptions designed to protect the public's interest, the </ins>&#10;8.16    <ins>privacy of individuals, and insurers' proprietary information, including trade secrets. The </ins>&#10;8.17    <ins>Commission may meet in camera only after a majority of the entire membership votes to </ins>&#10;8.18    <ins>close a meeting en toto or in part. As soon as practicable, the Commission must make </ins>&#10;8.19    <ins>public (i) a copy of the vote to close the meeting revealing the vote of each Member with </ins>&#10;8.20    <ins>no proxy votes allowed, and (ii) votes taken during such meeting;</ins>&#10;8.21    <ins>v. Establishing the titles, duties and authority and reasonable procedures for the </ins>&#10;8.22    <ins>election of the officers of the Commission;</ins>&#10;8.23    <ins>vi. Providing reasonable standards and procedures for the establishment of the </ins>&#10;8.24    <ins>personnel policies and programs of the Commission. Notwithstanding any civil service </ins>&#10;8.25    <ins>or other similar laws of any Compacting State, the Bylaws shall exclusively govern the </ins>&#10;8.26    <ins>personnel policies and programs of the Commission;</ins>&#10;8.27    <ins>vii. Promulgating a code of ethics to address permissible and prohibited activities of </ins>&#10;8.28    <ins>commission members and employees; and </ins>&#10;8.29    <ins>viii. Providing a mechanism for winding up the operations of the Commission and </ins>&#10;8.30    <ins>the equitable disposition of any surplus funds that may exist after the termination of the </ins>&#10;8.31    <ins>Compact after the payment and/or reserving of all of its debts and obligations.</ins>&#10;8.32    <ins>d. The Commission shall publish its bylaws in a convenient form and file a copy </ins>&#10;8.33    <ins>thereof and a copy of any amendment thereto, with the appropriate agency or officer in </ins>&#10;8.34    <ins>each of the Compacting States.</ins>&#10;8.35    <ins>2. Management Committee, Officers and Personnel</ins>&#10;9.1     <ins>a. A Management Committee comprising no more than 14 members shall be </ins>&#10;9.2     <ins>established as follows:</ins>&#10;9.3     <ins>i. One member from each of the six Compacting States with the largest premium </ins>&#10;9.4     <ins>volume for individual and group annuities, life, disability income and long-term care </ins>&#10;9.5     <ins>insurance products, determined from the records of the NAIC for the prior year;</ins>&#10;9.6     <ins>ii. Four members from those Compacting States with at least two percent of the </ins>&#10;9.7     <ins>market based on the premium volume described above, other than the six Compacting </ins>&#10;9.8     <ins>States with the largest premium volume, selected on a rotating basis as provided in the </ins>&#10;9.9     <ins>Bylaws; and</ins>&#10;9.10    <ins>iii. Four members from those Compacting States with less than two percent of the </ins>&#10;9.11    <ins>market, based on the premium volume described above, with one selected from each of </ins>&#10;9.12    <ins>the four zone regions of the NAIC as provided in the Bylaws.</ins>&#10;9.13    <ins>b. The Management Committee shall have such authority and duties as may be set </ins>&#10;9.14    <ins>forth in the Bylaws, including but not limited to:</ins>&#10;9.15    <ins>i. Managing the affairs of the Commission in a manner consistent with the Bylaws </ins>&#10;9.16    <ins>and purposes of the Commission;</ins>&#10;9.17    <ins>ii. Establishing and overseeing an organizational structure within, and appropriate </ins>&#10;9.18    <ins>procedures for, the Commission to provide for the creation of Uniform Standards and </ins>&#10;9.19    <ins>other Rules, receipt and review of product filings, administrative and technical support </ins>&#10;9.20    <ins>functions, review of decisions regarding the disapproval of a product filing, and the review </ins>&#10;9.21    <ins>of elections made by a Compacting State to opt out of a Uniform Standard; provided that a </ins>&#10;9.22    <ins>Uniform Standard shall not be submitted to the Compacting States for adoption unless </ins>&#10;9.23    <ins>approved by two-thirds of the members of the Management Committee;</ins>&#10;9.24    <ins>iii. Overseeing the offices of the Commission; and</ins>&#10;9.25    <ins>iv. Planning, implementing, and coordinating communications and activities with </ins>&#10;9.26    <ins>other state, federal and local government organizations in order to advance the goals </ins>&#10;9.27    <ins>of the Commission.</ins>&#10;9.28    <ins>c. The Commission shall elect annually officers from the Management Committee, </ins>&#10;9.29    <ins>with each having such authority and duties, as may be specified in the Bylaws.</ins>&#10;9.30    <ins>d. The Management Committee may, subject to the approval of the Commission, </ins>&#10;9.31    <ins>appoint or retain an executive director for such period, upon such terms and conditions </ins>&#10;9.32    <ins>and for such compensation as the Commission may deem appropriate. The executive </ins>&#10;9.33    <ins>director shall serve as secretary to the Commission, but shall not be a Member of the </ins>&#10;9.34    <ins>Commission. The executive director shall hire and supervise such other staff as may be </ins>&#10;9.35    <ins>authorized by the Commission.</ins>&#10;9.36    <ins>3. Legislative and Advisory Committees</ins>&#10;10.1    <ins>a. A legislative committee comprising state legislators or their designees shall be </ins>&#10;10.2    <ins>established to monitor the operations of, and make recommendations to, the Commission, </ins>&#10;10.3    <ins>including the Management Committee; provided that the manner of selection and term of </ins>&#10;10.4    <ins>any legislative committee member shall be as set forth in the Bylaws. Prior to the adoption </ins>&#10;10.5    <ins>by the Commission of any Uniform Standard, revision to the Bylaws, annual budget or </ins>&#10;10.6    <ins>other significant matter as may be provided in the Bylaws, the Management Committee </ins>&#10;10.7    <ins>shall consult with and report to the legislative committee.</ins>&#10;10.8    <ins>b. The Commission shall establish two advisory committees, one of which shall </ins>&#10;10.9    <ins>comprise consumer representatives independent of the insurance industry, and the other </ins>&#10;10.10   <ins>comprising insurance industry representatives.</ins>&#10;10.11   <ins>c. The Commission may establish additional advisory committees as its Bylaws may </ins>&#10;10.12   <ins>provide for the carrying out of its functions.</ins>&#10;10.13   <ins>4. Corporate Records of the Commission</ins>&#10;10.14   <ins>The Commission shall maintain its corporate books and records in accordance </ins>&#10;10.15   <ins>with the Bylaws.</ins>&#10;10.16   <ins>5. Qualified Immunity, Defense, and Indemnification</ins>&#10;10.17   <ins>a. The Members, officers, executive director, employees, and representatives of </ins>&#10;10.18   <ins>the Commission shall be immune from suit and liability, either personally or in their </ins>&#10;10.19   <ins>official capacity, for any claim for damage to or loss of property or personal injury or </ins>&#10;10.20   <ins>other civil liability caused by or arising out of any actual or alleged act, error or omission </ins>&#10;10.21   <ins>that occurred, or that the person against whom the claim is made had a reasonable </ins>&#10;10.22   <ins>basis for believing occurred within the scope of Commission employment, duties or </ins>&#10;10.23   <ins>responsibilities; provided, that nothing in this paragraph shall be construed to protect any </ins>&#10;10.24   <ins>such person from suit and/or liability for any damage, loss, injury or liability caused by </ins>&#10;10.25   <ins>the intentional or willful and wanton misconduct of that person.</ins>&#10;10.26   <ins>b. The Commission shall defend any Member, officer, executive director, employee, </ins>&#10;10.27   <ins>or representative of the Commission in any civil action seeking to impose liability arising </ins>&#10;10.28   <ins>out of any actual or alleged act, error, or omission that occurred within the scope of </ins>&#10;10.29   <ins>Commission employment, duties, or responsibilities, or that the person against whom </ins>&#10;10.30   <ins>the claim is made had a reasonable basis for believing occurred within the scope of </ins>&#10;10.31   <ins>Commission employment, duties, or responsibilities; provided, that nothing herein shall </ins>&#10;10.32   <ins>be construed to prohibit that person from retaining his or her own counsel; and provided </ins>&#10;10.33   <ins>further, that the actual or alleged act, error, or omission did not result from that person's </ins>&#10;10.34   <ins>intentional or willful and wanton misconduct.</ins>&#10;10.35   <ins>c. The Commission shall indemnify and hold harmless any Member, officer, </ins>&#10;10.36   <ins>executive director, employee, or representative of the Commission for the amount of any </ins>&#10;11.1    <ins>settlement or judgment obtained against that person arising out of any actual or alleged </ins>&#10;11.2    <ins>act, error, or omission that occurred within the scope of Commission employment, duties, </ins>&#10;11.3    <ins>or responsibilities, or that such person had a reasonable basis for believing occurred </ins>&#10;11.4    <ins>within the scope of Commission employment, duties, or responsibilities, provided, that the </ins>&#10;11.5    <ins>actual or alleged act, error, or omission did not result from the intentional or willful and </ins>&#10;11.6    <ins>wanton misconduct of that person.</ins>&#10;11.7    <ins>Article VI. Meetings and Acts of the Commission</ins>&#10;11.8    <ins>1. The Commission shall meet and take such actions as are consistent with the </ins>&#10;11.9    <ins>provisions of this Compact and the Bylaws.</ins>&#10;11.10   <ins>2. Each Member of the Commission shall have the right and power to cast a vote to </ins>&#10;11.11   <ins>which that Compacting State is entitled and to participate in the business and affairs of the </ins>&#10;11.12   <ins>Commission. A Member shall vote in person or by such other means as provided in the </ins>&#10;11.13   <ins>Bylaws. The Bylaws may provide for Members' participation in meetings by telephone or </ins>&#10;11.14   <ins>other means of communication.</ins>&#10;11.15   <ins>3. The Commission shall meet at least once during each calendar year. Additional </ins>&#10;11.16   <ins>meeting shall be held as set forth in the Bylaws.</ins>&#10;11.17   <ins>Article VII. Rules and Operating Procedures: Rulemaking Functions</ins>&#10;11.18   <ins>of the Commission and Opting Out of Uniform Standards</ins>&#10;11.19   <ins>1. Rulemaking Authority. The Commission shall promulgate reasonable Rules, </ins>&#10;11.20   <ins>including Uniform Standards, and Operating Procedures in order to effectively and </ins>&#10;11.21   <ins>efficiently achieve the purposes of this Compact. Notwithstanding the foregoing, in the </ins>&#10;11.22   <ins>event the Commission exercises its rulemaking authority in a manner that is beyond the </ins>&#10;11.23   <ins>scope of the purposes of this Act, or the powers granted hereunder, then such an action by </ins>&#10;11.24   <ins>the Commission shall be invalid and have no force and effect.</ins>&#10;11.25   <ins>2. Rulemaking Procedure. Rules and Operating Procedures shall be made pursuant </ins>&#10;11.26   <ins>to a rulemaking process that conforms to the Model State Administrative Procedure Act of </ins>&#10;11.27   <ins>1981 as amended, as may be appropriate to the operations of the Commission. Before </ins>&#10;11.28   <ins>the Commission adopts a Uniform Standard, the Commission shall give written notice </ins>&#10;11.29   <ins>to the relevant state legislative committee(s) in each Compacting State responsible for </ins>&#10;11.30   <ins>insurance issues of its intention to adopt the Uniform Standard. The Commission in </ins>&#10;11.31   <ins>adopting a Uniform Standard shall consider fully all submitted materials and issue a </ins>&#10;11.32   <ins>concise explanation of its decision.</ins>&#10;11.33   <ins>3. Effective Date and Opt Out of a Uniform Standard. A Uniform Standard shall </ins>&#10;11.34   <ins>become effective 90 days after its promulgation by the Commission or such later date </ins>&#10;11.35   <ins>as the Commission may determine; provided, however, that a Compacting State may </ins>&#10;11.36   <ins>opt out of a Uniform Standard as provided in this Article. "Opt out" shall be defined as </ins>&#10;12.1    <ins>any action by a Compacting State to decline to adopt or participate in a promulgated </ins>&#10;12.2    <ins>Uniform Standard. All other Rules and Operating Procedures, and amendments thereto, </ins>&#10;12.3    <ins>shall become effective as of the date specified in each Rule, Operating Procedure, or </ins>&#10;12.4    <ins>amendment.</ins>&#10;12.5    <ins>4. Opt Out Procedure. A Compacting State may opt out of a Uniform Standard, </ins>&#10;12.6    <ins>either by legislation or regulation duly promulgated by the Insurance Department under </ins>&#10;12.7    <ins>the Compacting State's Administrative Procedure Act. If a Compacting State elects to opt </ins>&#10;12.8    <ins>out of a Uniform Standard by regulation, it must (a) give written notice to the Commission </ins>&#10;12.9    <ins>no later than ten business days after the Uniform Standard is promulgated, or at the time </ins>&#10;12.10   <ins>the State becomes a Compacting State and (b) find that the Uniform Standard does not </ins>&#10;12.11   <ins>provide reasonable protections to the citizens of the State, given the conditions in the State. </ins>&#10;12.12   <ins>The Commissioner shall make specific findings of fact and conclusions of law, based on a </ins>&#10;12.13   <ins>preponderance of the evidence, detailing the conditions in the State which warrant a </ins>&#10;12.14   <ins>departure from the Uniform Standard and determining that the Uniform Standard would </ins>&#10;12.15   <ins>not reasonably protect the citizens of the State. The Commissioner must consider and </ins>&#10;12.16   <ins>balance the following factors and find that the conditions in the State and needs of the </ins>&#10;12.17   <ins>citizens of the State outweigh: (i) the intent of the legislature to participate in, and the </ins>&#10;12.18   <ins>benefits of, an interstate agreement to establish national uniform consumer protections for </ins>&#10;12.19   <ins>the Products subject to this Act; and (ii) the presumption that a Uniform Standard adopted </ins>&#10;12.20   <ins>by the Commission provides reasonable protections to consumers of the relevant Product.</ins>&#10;12.21   <ins>Notwithstanding the foregoing, a Compacting State may, at the time of its enactment </ins>&#10;12.22   <ins>of this Compact, prospectively opt out of all Uniform Standards involving long-term care </ins>&#10;12.23   <ins>insurance products by expressly providing for such opt out in the enacted Compact, and </ins>&#10;12.24   <ins>such an opt out shall not be treated as a material variance in the offer or acceptance of </ins>&#10;12.25   <ins>any State to participate in this Compact. Such an opt out shall be effective at the time </ins>&#10;12.26   <ins>of enactment of this Compact by the Compacting State and shall apply to all existing </ins>&#10;12.27   <ins>Uniform Standards involving long-term care insurance products and those subsequently </ins>&#10;12.28   <ins>promulgated.</ins>&#10;12.29   <ins>5. Effect of Opt Out. If a Compacting State elects to opt out of a Uniform Standard, </ins>&#10;12.30   <ins>the Uniform Standard shall remain applicable in the Compacting State electing to opt out </ins>&#10;12.31   <ins>until such time the opt out legislation is enacted into law or the regulation opting out </ins>&#10;12.32   <ins>becomes effective.</ins>&#10;12.33   <ins>Once the opt out of a Uniform Standard by a Compacting State becomes effective </ins>&#10;12.34   <ins>as provided under the laws of that State, the Uniform Standard shall have no further </ins>&#10;12.35   <ins>force and effect in that State unless and until the legislation or regulation implementing </ins>&#10;12.36   <ins>the opt out is repealed or otherwise becomes ineffective under the laws of the State. If a </ins>&#10;13.1    <ins>Compacting State opts out of a Uniform Standard after the Uniform Standard has been </ins>&#10;13.2    <ins>made effective in that State, the opt out shall have the same prospective effect as provided </ins>&#10;13.3    <ins>under Article XIV for withdrawals.</ins>&#10;13.4    <ins>6. Stay of Uniform Standard. If a Compacting State has formally initiated the </ins>&#10;13.5    <ins>process of opting out of a Uniform Standard by regulation, and while the regulatory </ins>&#10;13.6    <ins>opt out is pending, the Compacting State may petition the Commission, at least 15 days </ins>&#10;13.7    <ins>before the effective date of the Uniform Standard, to stay the effectiveness of the Uniform </ins>&#10;13.8    <ins>Standard in that State. The Commission may grant a stay if it determines the regulatory </ins>&#10;13.9    <ins>opt out is being pursued in a reasonable manner and there is a likelihood of success. If a </ins>&#10;13.10   <ins>stay is granted or extended by the Commission, the stay or extension thereof may postpone </ins>&#10;13.11   <ins>the effective date by up to 90 days, unless affirmatively extended by the Commission; </ins>&#10;13.12   <ins>provided, a stay may not be permitted to remain in effect for more than one year unless the </ins>&#10;13.13   <ins>Compacting State can show extraordinary circumstances which warrant a continuance of </ins>&#10;13.14   <ins>the stay, including, but not limited to, the existence of a legal challenge which prevents the </ins>&#10;13.15   <ins>Compacting State from opting out. A stay may be terminated by the Commission upon </ins>&#10;13.16   <ins>notice that the rulemaking process has been terminated.</ins>&#10;13.17   <ins>7. Not later than 30 days after a Rule or Operating Procedure is promulgated, </ins>&#10;13.18   <ins>any person may file a petition for judicial review of the Rule or Operating Procedure; </ins>&#10;13.19   <ins>provided, that the filing of such a petition shall not stay or otherwise prevent the Rule or </ins>&#10;13.20   <ins>Operating Procedure from becoming effective unless the court finds that the petitioner </ins>&#10;13.21   <ins>has a substantial likelihood of success. The court shall give deference to the actions of </ins>&#10;13.22   <ins>the Commission consistent with applicable law and shall not find the Rule or Operating </ins>&#10;13.23   <ins>Procedure to be unlawful if the Rule or Operating Procedure represents a reasonable </ins>&#10;13.24   <ins>exercise of the Commission's authority.</ins>&#10;13.25   <ins>Article VIII. Commission Records and Enforcement</ins>&#10;13.26   <ins>1. The Commission shall promulgate Rules establishing conditions and procedures </ins>&#10;13.27   <ins>for public inspection and copying of its information and official records, except such </ins>&#10;13.28   <ins>information and records involving the privacy of individuals and insurers' trade secrets. </ins>&#10;13.29   <ins>The Commission may promulgate additional Rules under which it may make available to </ins>&#10;13.30   <ins>federal and state agencies, including law enforcement agencies, records and information </ins>&#10;13.31   <ins>otherwise exempt from disclosure, and may enter into agreements with such agencies to </ins>&#10;13.32   <ins>receive or exchange information or records subject to nondisclosure and confidentiality </ins>&#10;13.33   <ins>provisions.</ins>&#10;13.34   <ins>2. Except as to privileged records, data and information, the laws of any Compacting </ins>&#10;13.35   <ins>State pertaining to confidentiality or nondisclosure shall not relieve any Compacting </ins>&#10;13.36   <ins>State Commissioner of the duty to disclose any relevant records, data or information to </ins>&#10;14.1    <ins>the Commission; provided, that disclosure to the Commission shall not be deemed to </ins>&#10;14.2    <ins>waive or otherwise affect any confidentiality requirement; and further provided, that, </ins>&#10;14.3    <ins>except as otherwise expressly provided in this Act, the Commission shall not be subject </ins>&#10;14.4    <ins>to the Compacting State's laws pertaining to confidentiality and nondisclosure with </ins>&#10;14.5    <ins>respect to records, data and information in its possession. Confidential information </ins>&#10;14.6    <ins>of the Commission shall remain confidential after such information is provided to any </ins>&#10;14.7    <ins>Commissioner.</ins>&#10;14.8    <ins>3. The Commission shall monitor Compacting States for compliance with duly </ins>&#10;14.9    <ins>adopted Bylaws, Rules, including Uniform Standards, and Operating Procedures. </ins>&#10;14.10   <ins>The Commission shall notify any noncomplying Compacting State in writing of </ins>&#10;14.11   <ins>its noncompliance with Commission Bylaws, Rules or Operating Procedures. If a </ins>&#10;14.12   <ins>noncomplying Compacting State fails to remedy its noncompliance within the time </ins>&#10;14.13   <ins>specified in the notice of noncompliance, the Compacting State shall be deemed to be in </ins>&#10;14.14   <ins>default as set forth in Article XIV.</ins>&#10;14.15   <ins>4. The Commissioner of any State in which an Insurer is authorized to do business, </ins>&#10;14.16   <ins>or is conducting the business of insurance, shall continue to exercise his or her authority </ins>&#10;14.17   <ins>to oversee the market regulation of the activities of the Insurer in accordance with the </ins>&#10;14.18   <ins>provisions of the State's law. The Commissioner's enforcement of compliance with the </ins>&#10;14.19   <ins>Compact is governed by the following provisions:</ins>&#10;14.20   <ins>a. With respect to the Commissioner's market regulation of a Product or </ins>&#10;14.21   <ins>Advertisement that is approved or certified to the Commission, the content of the </ins>&#10;14.22   <ins>Product or Advertisement shall not constitute a violation of the provisions, standards or </ins>&#10;14.23   <ins>requirements of the Compact except upon a final order of the Commission, issued at the </ins>&#10;14.24   <ins>request of a Commissioner after prior notice to the Insurer and an opportunity for hearing </ins>&#10;14.25   <ins>before the Commission.</ins>&#10;14.26   <ins>b. Before a Commissioner may bring an action for violation of any provision, </ins>&#10;14.27   <ins>standard or requirement of the Compact relating to the content of an Advertisement not </ins>&#10;14.28   <ins>approved or certified to the Commission, the Commission, or an authorized Commission </ins>&#10;14.29   <ins>officer or employee, must authorize the action. However, authorization pursuant to this </ins>&#10;14.30   <ins>paragraph does not require notice to the Insurer, opportunity for hearing or disclosure of </ins>&#10;14.31   <ins>requests for authorization or records of the Commission's action on such requests.</ins>&#10;14.32   <ins>Article IX. Dispute Resolution</ins>&#10;14.33   <ins>The Commission shall attempt, upon the request of a Member, to resolve any </ins>&#10;14.34   <ins>disputes or other issues that are subject to this Compact and which may arise between two </ins>&#10;14.35   <ins>or more Compacting States, or between Compacting States and Noncompacting States, </ins>&#10;15.1    <ins>and the Commission shall promulgate an Operating Procedure providing for resolution of </ins>&#10;15.2    <ins>such disputes.</ins>&#10;15.3    <ins>Article X. Product Filing and Approval</ins>&#10;15.4    <ins>1. Insurers and Third Party Filers seeking to have a Product approved by the </ins>&#10;15.5    <ins>Commission shall file the Product with, and pay applicable filing fees to, the Commission. </ins>&#10;15.6    <ins>Nothing in this Act shall be construed to restrict or otherwise prevent an insurer from </ins>&#10;15.7    <ins>filing its Product with the insurance department in any State wherein the insurer is licensed </ins>&#10;15.8    <ins>to conduct the business of insurance, and such filing shall be subject to the laws of the </ins>&#10;15.9    <ins>States where filed.</ins>&#10;15.10   <ins>2. The Commission shall establish appropriate filing and review processes and </ins>&#10;15.11   <ins>procedures pursuant to Commission Rules and Operating Procedures. Notwithstanding </ins>&#10;15.12   <ins>any provision herein to the contrary, the Commission shall promulgate Rules to establish </ins>&#10;15.13   <ins>conditions and procedures under which the Commission will provide public access to </ins>&#10;15.14   <ins>Product filing information. In establishing such Rules, the Commission shall consider </ins>&#10;15.15   <ins>the interests of the public in having access to such information, as well as protection of </ins>&#10;15.16   <ins>personal medical and financial information and trade secrets, that may be contained in a </ins>&#10;15.17   <ins>Product filing or supporting information.</ins>&#10;15.18   <ins>3. Any Product approved by the Commission may be sold or otherwise issued in </ins>&#10;15.19   <ins>those Compacting States for which the Insurer is legally authorized to do business.</ins>&#10;15.20   <ins>Article XI. Review of Commission Decisions Regarding Filings</ins>&#10;15.21   <ins>1. Not later than 30 days after the Commission has given notice of a disapproved </ins>&#10;15.22   <ins>Product or Advertisement filed with the Commission, the Insurer or Third Party Filer </ins>&#10;15.23   <ins>whose filing was disapproved may appeal the determination to a review panel appointed </ins>&#10;15.24   <ins>by the Commission. The Commission shall promulgate Rules to establish procedures for </ins>&#10;15.25   <ins>appointing such review panels and provide for notice and hearing. An allegation that the </ins>&#10;15.26   <ins>Commission, in disapproving a Product or Advertisement filed with the Commission, </ins>&#10;15.27   <ins>acted arbitrarily, capriciously, or in a manner that is an abuse of discretion or otherwise </ins>&#10;15.28   <ins>not in accordance with the law, is subject to judicial review in accordance with Article </ins>&#10;15.29   <ins>III, Section 4.</ins>&#10;15.30   <ins>2. The Commission shall have authority to monitor, review and reconsider Products </ins>&#10;15.31   <ins>and Advertisement subsequent to their filing or approval upon a finding that the product </ins>&#10;15.32   <ins>does not meet the relevant Uniform Standard. Where appropriate, the Commission may </ins>&#10;15.33   <ins>withdraw or modify its approval after proper notice and hearing, subject to the appeal </ins>&#10;15.34   <ins>process in Section 1 above.</ins>&#10;15.35   <ins>Article XII. Finance</ins>&#10;16.1    <ins>1. The Commission shall pay or provide for the payment of the reasonable expenses </ins>&#10;16.2    <ins>of its establishment and organization. To fund the cost of its initial operations, the </ins>&#10;16.3    <ins>Commission may accept contributions and other forms of funding from the National </ins>&#10;16.4    <ins>Association of Insurance Commissioners, Compacting States, and other sources. </ins>&#10;16.5    <ins>Contributions and other forms of funding from other sources shall be of such a nature </ins>&#10;16.6    <ins>that the independence of the Commission concerning the performance of its duties shall </ins>&#10;16.7    <ins>not be compromised.</ins>&#10;16.8    <ins>2. The Commission shall collect a filing fee from each Insurer and Third Party Filer </ins>&#10;16.9    <ins>filing a product with the Commission to cover the cost of the operations and activities </ins>&#10;16.10   <ins>of the Commission and its staff in a total amount sufficient to cover the Commission's </ins>&#10;16.11   <ins>annual budget.</ins>&#10;16.12   <ins>3. The Commission's budget for a fiscal year shall not be approved until it has been </ins>&#10;16.13   <ins>subject to notice and comment as set forth in Article VII of this Compact.</ins>&#10;16.14   <ins>4. The Commission shall be exempt from all taxation in and by the Compacting </ins>&#10;16.15   <ins>states.</ins>&#10;16.16   <ins>5. The Commission shall not pledge the credit of any Compacting State, except by </ins>&#10;16.17   <ins>and with the appropriate legal authority of that Compacting State.</ins>&#10;16.18   <ins>6. The Commission shall keep complete and accurate accounts of all its internal </ins>&#10;16.19   <ins>receipts, including grants and donations, and disbursements of all funds under its control. </ins>&#10;16.20   <ins>The internal financial accounts of the Commission shall be subject to the accounting </ins>&#10;16.21   <ins>procedures established under its Bylaws. The financial accounts and reports including the </ins>&#10;16.22   <ins>system of internal controls and procedures of the Commission shall be audited annually by </ins>&#10;16.23   <ins>an independent certified public accountant. Upon the determination of the Commission, </ins>&#10;16.24   <ins>but no less frequently than every three years, the review of the independent auditor shall </ins>&#10;16.25   <ins>include a management and performance audit of the Commission. The Commission shall </ins>&#10;16.26   <ins>make an Annual Report to the Governor and legislature of the Compacting States, which </ins>&#10;16.27   <ins>shall include a report of the independent audit. The Commission's internal accounts shall </ins>&#10;16.28   <ins>not be confidential and such materials may be shared with the Commissioner of any </ins>&#10;16.29   <ins>Compacting State upon request provided, however, that any work papers related to any </ins>&#10;16.30   <ins>internal or independent audit and any information regarding the privacy of individuals and </ins>&#10;16.31   <ins>insurers' proprietary information, including trade secrets, shall remain confidential.</ins>&#10;16.32   <ins>7. No Compacting State shall have any claim to or ownership of any property </ins>&#10;16.33   <ins>held by or vested in the Commission or to any Commission funds held pursuant to the </ins>&#10;16.34   <ins>provisions of this Compact.</ins>&#10;16.35   <ins>Article XIII. Compacting States, Effective Date and Amendment</ins>&#10;16.36   <ins>1. Any State is eligible to become a Compacting State.</ins>&#10;17.1    <ins>2. The Compact shall become effective and binding upon legislative enactment </ins>&#10;17.2    <ins>of the Compact into law by two Compacting States; provided, the Commission shall </ins>&#10;17.3    <ins>become effective for purposes of adopting Uniform Standards for, reviewing, and giving </ins>&#10;17.4    <ins>approval or disapproval of, Products filed with the Commission that satisfy applicable </ins>&#10;17.5    <ins>Uniform Standards only after 26 States are Compacting States or, alternatively, by States </ins>&#10;17.6    <ins>representing greater than 40 percent of the premium volume for life insurance, annuity, </ins>&#10;17.7    <ins>disability income and long-term care insurance products, based on records of the NAIC </ins>&#10;17.8    <ins>for the prior year. Thereafter, it shall become effective and binding as to any other </ins>&#10;17.9    <ins>Compacting State upon enactment of the Compact into law by that State.</ins>&#10;17.10   <ins>3. Amendments to the Compact may be proposed by the Commission for enactment </ins>&#10;17.11   <ins>by the Compacting States. No amendment shall become effective and binding upon the </ins>&#10;17.12   <ins>Commission and the Compacting States unless and until all Compacting States enact </ins>&#10;17.13   <ins>the amendment into law.</ins>&#10;17.14   <ins>Article XIV. Withdrawal, Default and Termination</ins>&#10;17.15   <ins>1. Withdrawal</ins>&#10;17.16   <ins>a. Once effective, the Compact shall continue in force and remain binding upon each </ins>&#10;17.17   <ins>and every Compacting State; provided, that a Compacting State may withdraw from the </ins>&#10;17.18   <ins>Compact ("Withdrawing State") by enacting a statute specifically repealing the statute </ins>&#10;17.19   <ins>which enacted the Compact into law.</ins>&#10;17.20   <ins>b. The effective date of withdrawal is the effective date of the repealing statute. </ins>&#10;17.21   <ins>However, the withdrawal shall not apply to any product filings approved or self-certified, </ins>&#10;17.22   <ins>or any Advertisement of such products, on the date the repealing statute becomes effective, </ins>&#10;17.23   <ins>except by mutual agreement of the Commission and the Withdrawing State unless the </ins>&#10;17.24   <ins>approval is rescinded by the Withdrawing State as provided in Paragraph e of this section.</ins>&#10;17.25   <ins>c. The Commissioner of the Withdrawing State shall immediately notify the </ins>&#10;17.26   <ins>Management Committee in writing upon the introduction of legislation repealing this </ins>&#10;17.27   <ins>Compact in the Withdrawing State.</ins>&#10;17.28   <ins>d. The Commission shall notify the other Compacting States of the introduction of </ins>&#10;17.29   <ins>such legislation within ten days after its receipt of notice thereof.</ins>&#10;17.30   <ins>e. The Withdrawing State is responsible for all obligations, duties and liabilities </ins>&#10;17.31   <ins>incurred through the effective date of withdrawal, including any obligations, the </ins>&#10;17.32   <ins>performance of which extend beyond the effective date of withdrawal, except to the extent </ins>&#10;17.33   <ins>those obligations may have been released or relinquished by mutual agreement of the </ins>&#10;17.34   <ins>Commission and the Withdrawing State. The Commission'</ins><ins>s approval of Products and </ins>&#10;17.35   <ins>Advertisement prior to the effective date of withdrawal shall continue to be effective and </ins>&#10;17.36   <ins>be given full force and effect in the Withdrawing State, unless formally rescinded by </ins>&#10;18.1    <ins>the Withdrawing State in the same manner as provided by the laws of the Withdrawing </ins>&#10;18.2    <ins>State for the prospective disapproval of products or advertisement previously approved </ins>&#10;18.3    <ins>under state law.</ins>&#10;18.4    <ins>f. Reinstatement following withdrawal of any Compacting State shall occur upon </ins>&#10;18.5    <ins>the effective date of the Withdrawing State reenacting the Compact.</ins>&#10;18.6    <ins>2. Default</ins>&#10;18.7    <ins>a. If the Commission determines that any Compacting State has at any time defaulted </ins>&#10;18.8    <ins>("Defaulting State") in the performance of any of its obligations or responsibilities under </ins>&#10;18.9    <ins>this Compact, the Bylaws or duly promulgated Rules or Operating Procedures, then, after </ins>&#10;18.10   <ins>notice and hearing as set forth in the Bylaws, all rights, privileges and benefits conferred </ins>&#10;18.11   <ins>by this Compact on the Defaulting State shall be suspended from the effective date of </ins>&#10;18.12   <ins>default as fixed by the Commission. The grounds for default include, but are not limited </ins>&#10;18.13   <ins>to, failure of a Compacting State to perform its obligations or responsibilities, and any </ins>&#10;18.14   <ins>other grounds designated in Commission Rules. The Commission shall immediately </ins>&#10;18.15   <ins>notify the Defaulting State in writing of the Defaulting State's suspension pending a cure </ins>&#10;18.16   <ins>of the default. The Commission shall stipulate the conditions and the time period within </ins>&#10;18.17   <ins>which the Defaulting State must cure its default. If the Defaulting State fails to cure the </ins>&#10;18.18   <ins>default within the time period specified by the Commission, the Defaulting State shall </ins>&#10;18.19   <ins>be terminated form the Compact and all rights, privileges and benefits conferred by this </ins>&#10;18.20   <ins>Compact shall be terminated from the effective date of termination.</ins>&#10;18.21   <ins>b. Product approvals by the Commission or product self-certifications, or any </ins>&#10;18.22   <ins>Advertisement in connection with such product, that are in force on the effective date of </ins>&#10;18.23   <ins>termination shall remain in force in the Defaulting State in the same manner as if the </ins>&#10;18.24   <ins>Defaulting State had withdrawn voluntarily pursuant to Section 1 of this article.</ins>&#10;18.25   <ins>c. Reinstatement following termination of any Compacting State requires a </ins>&#10;18.26   <ins>reenactment of the Compact.</ins>&#10;18.27   <ins>3. Dissolution of Compact</ins>&#10;18.28   <ins>a. The Compact dissolves effective upon the date of the withdrawal or default of the </ins>&#10;18.29   <ins>Compacting State which reduces membership in the Compact to one Compacting State.</ins>&#10;18.30   <ins>b. Upon the dissolution of this Compact, the Compact becomes null and void and </ins>&#10;18.31   <ins>shall be of no further force or effect, and the business and affairs of the Commission shall </ins>&#10;18.32   <ins>be wound up and any surplus funds shall be distributed in accordance with the Bylaws.</ins>&#10;18.33   <ins>Article XV. Severability and Construction</ins>&#10;18.34   <ins>1. The provisions of this Compact shall be severable; and if any phrase, clause, </ins>&#10;18.35   <ins>sentence, or provision is deemed unenforceable, the remaining provisions of the Compact </ins>&#10;18.36   <ins>shall be enforceable.</ins>&#10;19.1    <ins>2. The provisions of this Compact shall be liberally construed to effectuate its </ins>&#10;19.2    <ins>purposes.</ins>&#10;19.3    <ins>Article XVI. Binding Effect of Compact and Other Laws</ins>&#10;19.4    <ins>1. Other Laws</ins>&#10;19.5    <ins>a. Nothing herein prevents the enforcement of any other law of a Compacting State, </ins>&#10;19.6    <ins>except as provided in Paragraph b of this section.</ins>&#10;19.7    <ins>b. For any Product approved or certified to the Commission, the Rules, Uniform </ins>&#10;19.8    <ins>Standards, and any other requirements of the Commission shall constitute the exclusive </ins>&#10;19.9    <ins>provisions applicable to the content, approval, and certification of such Products. For </ins>&#10;19.10   <ins>Advertisement that is subject to the Commission's authority, any Rule, Uniform Standard, </ins>&#10;19.11   <ins>or other requirement of the Commission which governs the content of the Advertisement </ins>&#10;19.12   <ins>shall constitute the exclusive provision that a Commissioner may apply to the content of </ins>&#10;19.13   <ins>the Advertisement. Notwithstanding the foregoing, no action taken by the Commission </ins>&#10;19.14   <ins>shall abrogate or restrict: (i) the access of any person to state courts; (ii) remedies available </ins>&#10;19.15   <ins>under state law related to breach of contract, tort, or other laws not specifically directed </ins>&#10;19.16   <ins>to the content of the Product; (iii) state law relating to the construction of insurance </ins>&#10;19.17   <ins>contracts; or (iv) the authority of the attorney general of the state, including but not limited </ins>&#10;19.18   <ins>to maintaining any actions or proceedings, as authorized by law.</ins>&#10;19.19   <ins>c. All insurance products filed with individual States shall be subject to the laws </ins>&#10;19.20   <ins>of those States.</ins>&#10;19.21   <ins>2. Binding Effect of this Compact</ins>&#10;19.22   <ins>a. All lawful actions of the Commission, including all Rules and Operating </ins>&#10;19.23   <ins>Procedures promulgated by the Commission, are binding upon the Compacting States.</ins>&#10;19.24   <ins>b. All agreements between the Commission and the Compacting States are binding </ins>&#10;19.25   <ins>in accordance with their terms.</ins>&#10;19.26   <ins>c. Upon the request of a party to a conflict over the meaning or interpretation of </ins>&#10;19.27   <ins>Commission actions, and upon a majority vote of the Compacting States, the Commission </ins>&#10;19.28   <ins>may issue advisory opinions regarding the meaning or interpretation in dispute.</ins>&#10;19.29   <ins>d. In the event any provision of this Compact exceeds the constitutional limits </ins>&#10;19.30   <ins>imposed on the legislature of any Compacting State, the obligations, duties, powers </ins>&#10;19.31   <ins>or jurisdiction sought to be conferred by that provision upon the Commission shall </ins>&#10;19.32   <ins>be ineffective as to that Compacting State, and those obligations, duties, powers, or </ins>&#10;19.33   <ins>jurisdiction shall remain in the Compacting State and shall be exercised by the agency </ins>&#10;19.34   <ins>thereof to which those obligations, duties, powers, or jurisdiction are delegated by law in </ins>&#10;19.35   <ins>effect at the time this Compact becomes effective.</ins>&#10;20.1        <ins>Subd. 2.</ins> <ins><b>Commission representative.</b></ins> <ins>The commissioner of commerce is the </ins>&#10;20.2    <ins>representative of this state to the commission.</ins>&#10;&#10;<a id="go.0.4.0"></a>20.3        Sec. 4. <ins><b>[60A.991] INTERSTATE INSURANCE PRODUCT REGULATION </b></ins>&#10;20.4    <ins><b>COMPACT OPT OUT ADMINISTRATION.</b></ins>&#10;20.5        <ins>Subdivision 1.</ins> <ins><b>Access to courts.</b></ins> <ins>The commissioner must opt out by regulation of </ins>&#10;20.6    <ins>any uniform standard that permits a product to deny a consumer's access to the courts to </ins>&#10;20.7    <ins>resolve a dispute related to the product. In addition to opting out, the commissioner must </ins>&#10;20.8    <ins>petition the commission for a stay of the effective date of the standard.</ins>&#10;20.9        <ins>Subd. 2.</ins> <ins><b>Deference by courts.</b></ins> <ins>A decision by the commissioner to opt out by </ins>&#10;20.10   <ins>regulation shall be given deference by the courts.</ins>&#10;&#10;<a id="go.0.5.0"></a>20.11       Sec. 5. Minnesota Statutes 2004, section 61A.02, subdivision 3, is amended to read:&#10;20.12       Subd. 3. <b>Disapproval.</b> <ins>(a) </ins>The commissioner shall, within 60 days after the filing of &#10;20.13   any form, disapprove the form:&#10;20.14   (1) if the benefits provided are unreasonable in relation to the premium charged;&#10;20.15   (2) if the safety and soundness of the company would be threatened by the offering &#10;20.16   of an excess rate of interest on the policy or contract;&#10;20.17   (3) if it contains a provision or provisions which are unlawful, unfair, inequitable, &#10;20.18   misleading, or encourages misrepresentation of the policy; or&#10;20.19   (4) if the form, or its provisions, is otherwise not in the public interest. It shall &#10;20.20   be unlawful for the company to issue any policy in the form so disapproved. If the &#10;20.21   commissioner does not within 60 days after the filing of any form, disapprove or otherwise &#10;20.22   object, the form shall be deemed approved.&#10;20.23   <ins>(b) When an insurer or the Minnesota Comprehensive Health Association fails to </ins>&#10;20.24   <ins>respond to an objection or inquiry within 60 days, the filing is automatically disapproved. </ins>&#10;20.25   <ins>A resubmission is required if action by the Department of Commerce is subsequently </ins>&#10;20.26   <ins>requested. An additional filing fee is required for the resubmission.</ins>&#10;20.27   <ins>(c) </ins>For purposes of <ins>paragraph (a), </ins>clause (2), an excess rate of interest is a rate of &#10;20.28   interest exceeding the rate of interest determined by subtracting three percentage points &#10;20.29   from Moody's corporate bond yield average as most recently available.&#10;&#10;<a id="go.0.6.0"></a>20.30       Sec. 6. Minnesota Statutes 2004, section 61A.092, subdivision 3, is amended to read:&#10;20.31       Subd. 3. <b>Notice of options.</b> Upon termination of or layoff from employment of a &#10;20.32   covered employee, the employer shall inform the employee of:&#10;20.33   (1) the employee's right to elect to continue the coverage;&#10;21.1    (2) the amount the employee must pay monthly to the employer to retain the &#10;21.2    coverage;&#10;21.3    (3) the manner in which and the office of the employer to which the payment to &#10;21.4    the employer must be made; and&#10;21.5    (4) the time by which the payments to the employer must be made to retain coverage.&#10;21.6    The employee has 60 days within which to elect coverage. The 60-day period shall &#10;21.7    begin to run on the date coverage would otherwise terminate or on the date upon which &#10;21.8    notice of the right to coverage is received, whichever is later.&#10;21.9    If the covered employee or covered dependent dies during the 60-day election period &#10;21.10   and before the covered employee makes an election to continue or reject continuation, then &#10;21.11   the covered employee will be considered to have elected continuation of coverage. The &#10;21.12   <del>estate of</del> <ins>beneficiary previously selected by </ins>the former employee or covered dependent &#10;21.13   would then be entitled to a death benefit equal to the amount of insurance that could have &#10;21.14   been continued less any unpaid premium owing as of the date of death.&#10;21.15   Notice must be in writing and sent by first class mail to the employee's last known &#10;21.16   address which the employee has provided to the employer.&#10;21.17   A notice in substantially the following form is sufficient: "As a terminated or laid &#10;21.18   off employee, the law authorizes you to maintain your group insurance benefits, in an &#10;21.19   amount equal to the amount of insurance in effect on the date you terminated or were laid &#10;21.20   off from employment, for a period of up to 18 months. To do so, you must notify your &#10;21.21   former employer within 60 days of your receipt of this notice that you intend to retain this &#10;21.22   coverage and must make a monthly payment of $............ at ............. by the ............. of &#10;21.23   each month."&#10;&#10;<a id="go.0.7.0"></a>21.24       Sec. 7. Minnesota Statutes 2004, section 62A.02, subdivision 3, is amended to read:&#10;21.25       Subd. 3. <b>Standards for disapproval.</b> <ins>(a) </ins>The commissioner shall, within 60 days &#10;21.26   after the filing of any form or rate, disapprove the form or rate:&#10;21.27   (1) if the benefits provided are not reasonable in relation to the premium charged;&#10;21.28   (2) if it contains a provision or provisions which are unjust, unfair, inequitable, &#10;21.29   misleading, deceptive or encourage misrepresentation of the health plan form, or otherwise &#10;21.30   does not comply with this chapter, chapter 62L, or chapter 72A;&#10;21.31   (3) if the proposed premium rate is excessive or not adequate; or&#10;21.32   (4) the actuarial reasons and data submitted do not justify the rate.&#10;21.33   The party proposing a rate has the burden of proving by a preponderance of the &#10;21.34   evidence that it does not violate this subdivision.&#10;22.1    In determining the reasonableness of a rate, the commissioner shall also review &#10;22.2    all administrative contracts, service contracts, and other agreements to determine the &#10;22.3    reasonableness of the cost of the contracts or agreement and effect of the contracts on the &#10;22.4    rate. If the commissioner determines that a contract or agreement is not reasonable, the &#10;22.5    commissioner shall disapprove any rate that reflects any unreasonable cost arising out &#10;22.6    of the contract or agreement. The commissioner may require any information that the &#10;22.7    commissioner deems necessary to determine the reasonableness of the cost.&#10;22.8    For the purposes of this subdivision, the commissioner shall establish by rule a &#10;22.9    schedule of minimum anticipated loss ratios which shall be based on (i) the type or types &#10;22.10   of coverage provided, (ii) whether the policy is for group or individual coverage, and &#10;22.11   (iii) the size of the group for group policies. Except for individual policies of disability &#10;22.12   or income protection insurance, the minimum anticipated loss ratio shall not be less &#10;22.13   than 50 percent after the first year that a policy is in force. All applicants for a policy &#10;22.14   shall be informed in writing at the time of application of the anticipated loss ratio of the &#10;22.15   policy. "Anticipated loss ratio" means the ratio at the time of filing, at the time of notice &#10;22.16   of withdrawal under subdivision 4a, or at the time of subsequent rate revision of the &#10;22.17   present value of all expected future benefits, excluding dividends, to the present value &#10;22.18   of all expected future premiums.&#10;22.19   If the commissioner notifies a health carrier that has filed any form or rate that it &#10;22.20   does not comply with this chapter, chapter 62L, or chapter 72A, it shall be unlawful for &#10;22.21   the health carrier to issue or use the form or rate. In the notice the commissioner shall &#10;22.22   specify the reasons for disapproval and state that a hearing will be granted within 20 days &#10;22.23   after request in writing by the health carrier.&#10;22.24   The 60-day period within which the commissioner is to approve or disapprove the &#10;22.25   form or rate does not begin to run until a complete filing of all data and materials required &#10;22.26   by statute or requested by the commissioner has been submitted.&#10;22.27   However, if the supporting data is not filed within 30 days after a request by the &#10;22.28   commissioner, the rate is not effective and is presumed to be an excessive rate.&#10;22.29   <ins>(b) When an insurer or the Minnesota Comprehensive Health Association fails to </ins>&#10;22.30   <ins>respond to an objection or inquiry within 60 days, the filing is automatically disapproved. </ins>&#10;22.31   <ins>A resubmission is required if action by the Department of Commerce is subsequently </ins>&#10;22.32   <ins>requested. An additional filing fee is required for the resubmission.</ins>&#10;&#10;<a id="go.0.8.0"></a>22.33       Sec. 8. Minnesota Statutes 2004, section 62A.02, is amended by adding a subdivision &#10;22.34   to read:&#10;23.1        <ins>Subd. 3a.</ins> <ins><b>Individual policy rates file and use; minimum lifetime loss ratio </b></ins>&#10;23.2    <ins><b>guarantee.</b></ins> <ins>(a) Notwithstanding subdivisions 2, 3, 4a, 5a, and 6, individual premium </ins>&#10;23.3    <ins>rates may be used upon filing with the department of an individual policy form if the </ins>&#10;23.4    <ins>filing is accompanied by the individual policy form filing and a minimum lifetime loss </ins>&#10;23.5    <ins>ratio guarantee.  Insurers may use the filing procedure specified in this subdivision only if </ins>&#10;23.6    <ins>the affected individual policy forms disclose the benefit of a minimum lifetime loss ratio </ins>&#10;23.7    <ins>guarantee.  Insurers may amend individual policy forms to provide for a minimum lifetime </ins>&#10;23.8    <ins>loss ratio guarantee.  If an insurer elects to use the filing procedure in this subdivision for </ins>&#10;23.9    <ins>an individual policy rate, the insurer shall not use a filing of premium rates that does not </ins>&#10;23.10   <ins>provide a minimum lifetime loss ratio guarantee for that individual policy rate.</ins>&#10;23.11   <ins>(b) The minimum lifetime loss ratio guarantee must be in writing and must contain </ins>&#10;23.12   <ins>at least the following:</ins>&#10;23.13   <ins>(1) an actuarial memorandum specifying the expected loss ratio that complies with </ins>&#10;23.14   <ins>the standards as set forth in this subdivision;</ins>&#10;23.15   <ins>(2) a statement certifying that all rates, fees, dues, and other charges are not </ins>&#10;23.16   <ins>excessive, inadequate, or unfairly discriminatory;</ins>&#10;23.17   <ins>(3) detailed experience information concerning the policy forms;</ins>&#10;23.18   <ins>(4) a step-by-step description of the process used to develop the minimum lifetime </ins>&#10;23.19   <ins>loss ratio, including demonstration with supporting data;</ins>&#10;23.20   <ins>(5) guarantee of specific minimum lifetime loss ratio that must be greater than or </ins>&#10;23.21   <ins>equal to 65 percent for policies issued to individuals or for certificates issued to members </ins>&#10;23.22   <ins>of an association that does not offer coverage to small employers, taking into consideration </ins>&#10;23.23   <ins>adjustments for duration;</ins>&#10;23.24   <ins>(6) a guarantee that the actual Minnesota loss ratio for the calendar year in which the </ins>&#10;23.25   <ins>new rates take effect, and for each year thereafter until new rates are filed, will meet or </ins>&#10;23.26   <ins>exceed the minimum lifetime loss ratio standards referred to in clause (5), adjusted for </ins>&#10;23.27   <ins>duration;</ins>&#10;23.28   <ins>(7) a guarantee that the actual Minnesota lifetime loss ratio shall meet or exceed the </ins>&#10;23.29   <ins>minimum lifetime loss ratio standards referred to in clause (5); and </ins>&#10;23.30   <ins>(8) if the annual earned premium volume in Minnesota under the particular policy </ins>&#10;23.31   <ins>form is less than $2,500,000, the minimum lifetime loss ratio guarantee must be based </ins>&#10;23.32   <ins>partially on the Minnesota earned premium and other credible factors as specified by </ins>&#10;23.33   <ins>the commissioner.</ins>&#10;23.34   <ins>(c) The actual Minnesota minimum loss ratio results for each year at issue must be </ins>&#10;23.35   <ins>independently audited at the insurer's expense, and the audit report must be filed with the </ins>&#10;23.36   <ins>commissioner not later than 120 days after the end of the year at issue.</ins>&#10;24.1    <ins>(d) The insurer shall refund premiums in the amount necessary to bring the actual </ins>&#10;24.2    <ins>loss ratio up to the guaranteed minimum lifetime loss ratio. For the purpose of this </ins>&#10;24.3    <ins>paragraph, loss ratio and guaranteed minimum lifetime loss ratio are the expected </ins>&#10;24.4    <ins>aggregate loss ratio of all approved individual policy forms that provide for a minimum </ins>&#10;24.5    <ins>lifetime loss ratio guarantee.</ins>&#10;24.6    <ins>(e) A Minnesota policyholder affected by the guaranteed minimum lifetime loss </ins>&#10;24.7    <ins>ratio shall receive a portion of the premium refund relative to the premium paid by the </ins>&#10;24.8    <ins>policyholder. The refund must be made to all Minnesota policyholders insured under the </ins>&#10;24.9    <ins>applicable policy form during the year at issue if the refund would equal $10 or more per </ins>&#10;24.10   <ins>policy.  The refund must include statutory interest from July 1 of the year at issue until </ins>&#10;24.11   <ins>the date of payment.  Payment must be made not later than 180 days after the end of the </ins>&#10;24.12   <ins>year at issue.</ins>&#10;24.13   <ins>(f) Premium refunds of less than $10 per insured must be credited to the </ins>&#10;24.14   <ins>policyholder's account. </ins>&#10;24.15   <ins>(g) Subdivisions 2 and 3 do not apply if premium rates are filed with the department </ins>&#10;24.16   <ins>and accompanied by a minimum lifetime loss ratio guarantee that meets the requirements </ins>&#10;24.17   <ins>of this subdivision. Such filings are deemed approved. When determining a loss ratio for </ins>&#10;24.18   <ins>the purposes of a minimum lifetime loss ratio guarantee, the insurer shall divide the total </ins>&#10;24.19   <ins>of the claims incurred, plus preferred provider organization expenses, case management, </ins>&#10;24.20   <ins>and utilization review expenses, plus reinsurance premiums less reinsurance recoveries by </ins>&#10;24.21   <ins>the premiums earned less state and local taxes less other assessments. The insurer shall </ins>&#10;24.22   <ins>identify any assessment allocated.</ins>&#10;24.23   <ins>(h) The policy form filing of an insurer using the filing procedure with a minimum </ins>&#10;24.24   <ins>lifetime loss ratio guarantee must disclose to the enrollee, member, or subscriber an </ins>&#10;24.25   <ins>explanation of the minimum lifetime loss ratio guarantee, and the actual loss ratio, and any </ins>&#10;24.26   <ins>adjustments for duration.</ins>&#10;24.27   <ins>(i) The insurer who elects to use the filing procedure with a minimum lifetime loss </ins>&#10;24.28   <ins>ratio guarantee shall notify all policyholders of the refund calculation, the result of the </ins>&#10;24.29   <ins>refund calculation, the percentage of premium on an aggregate basis to be refunded, if </ins>&#10;24.30   <ins>any, any amount of the refund attributed to the payment of interests, and an explanation </ins>&#10;24.31   <ins>of amounts less than $10.</ins>&#10;&#10;<a id="go.0.9.0"></a>24.32       Sec. 9. Minnesota Statutes 2004, section 62A.021, subdivision 1, is amended to read:&#10;24.33       Subdivision 1. <b>Loss ratio standards.</b>  (a) Notwithstanding section 62A.02, &#10;24.34   subdivision 3, relating to loss ratios, <ins>and except as otherwise authorized by section </ins>&#10;24.35   <ins>62A.02, subdivision 3a, for individual policies or certificates, </ins>health care policies or &#10;25.1    certificates shall not be delivered or issued for delivery to an individual or to a small &#10;25.2    employer as defined in section 62L.02, unless the policies or certificates can be expected, &#10;25.3    as estimated for the entire period for which rates are computed to provide coverage, to &#10;25.4    return to Minnesota policyholders and certificate holders in the form of aggregate benefits &#10;25.5    not including anticipated refunds or credits, provided under the policies or certificates, (1) &#10;25.6    at least 75 percent of the aggregate amount of premiums earned in the case of policies &#10;25.7    issued in the small employer market, as defined in section 62L.02, subdivision 27, &#10;25.8    calculated on an aggregate basis; and (2) at least 65 percent of the aggregate amount &#10;25.9    of premiums earned in the case of each policy form or certificate form issued in the &#10;25.10   individual market; calculated on the basis of incurred claims experience or incurred health &#10;25.11   care expenses where coverage is provided by a health maintenance organization on a &#10;25.12   service rather than reimbursement basis and earned premiums for the period and according &#10;25.13   to accepted actuarial principles and practices.  Assessments by the reinsurance association &#10;25.14   created in chapter 62L and all types of taxes, surcharges, or assessments created by Laws &#10;25.15   1992, chapter 549, or created on or after April 23, 1992, are included in the calculation of &#10;25.16   incurred claims experience or incurred health care expenses. The applicable percentage &#10;25.17   for policies and certificates issued in the small employer market, as defined in section &#10;25.18   62L.02, increases by one percentage point on July 1 of each year, beginning on July 1, &#10;25.19   1994, until an 82 percent loss ratio is reached on July 1, 2000.  The applicable percentage &#10;25.20   for policy forms and certificate forms issued in the individual market increases by one &#10;25.21   percentage point on July 1 of each year, beginning on July 1, 1994, until a 72 percent loss &#10;25.22   ratio is reached on July 1, 2000.  A health carrier that enters a market after July 1, 1993, &#10;25.23   does not start at the beginning of the phase-in schedule and must instead comply with the &#10;25.24   loss ratio requirements applicable to other health carriers in that market for each time &#10;25.25   period.  Premiums earned and claims incurred in markets other than the small employer &#10;25.26   and individual markets are not relevant for purposes of this section.&#10;25.27   (b) All filings of rates and rating schedules shall demonstrate that actual expected &#10;25.28   claims in relation to premiums comply with the requirements of this section when &#10;25.29   combined with actual experience to date.  Filings of rate revisions shall also demonstrate &#10;25.30   that the anticipated loss ratio over the entire future period for which the revised rates &#10;25.31   are computed to provide coverage can be expected to meet the appropriate loss ratio &#10;25.32   standards, and aggregate loss ratio from inception of the policy form or certificate form &#10;25.33   shall equal or exceed the appropriate loss ratio standards.&#10;25.34   (c) A health carrier that issues health care policies and certificates to individuals &#10;25.35   or to small employers, as defined in section 62L.02, in this state shall file annually its &#10;25.36   rates, rating schedule, and supporting documentation including ratios of incurred losses &#10;26.1    to earned premiums by policy form or certificate form duration for approval by the &#10;26.2    commissioner according to the filing requirements and procedures prescribed by the &#10;26.3    commissioner.  The supporting documentation shall also demonstrate in accordance with &#10;26.4    actuarial standards of practice using reasonable assumptions that the appropriate loss ratio &#10;26.5    standards can be expected to be met over the entire period for which rates are computed.  &#10;26.6    The demonstration shall exclude active life reserves.  If the data submitted does not &#10;26.7    confirm that the health carrier has satisfied the loss ratio requirements of this section, &#10;26.8    the commissioner shall notify the health carrier in writing of the deficiency.  The health &#10;26.9    carrier shall have 30 days from the date of the commissioner's notice to file amended rates &#10;26.10   that comply with this section.  If the health carrier fails to file amended rates within the &#10;26.11   prescribed time, the commissioner shall order that the health carrier's filed rates for the &#10;26.12   nonconforming policy form or certificate form be reduced to an amount that would have &#10;26.13   resulted in a loss ratio that complied with this section had it been in effect for the reporting &#10;26.14   period of the supplement.  The health carrier's failure to file amended rates within the &#10;26.15   specified time or the issuance of the commissioner's order amending the rates does not &#10;26.16   preclude the health carrier from filing an amendment of its rates at a later time.  The &#10;26.17   commissioner shall annually make the submitted data available to the public at a cost not &#10;26.18   to exceed the cost of copying.  The data must be compiled in a form useful for consumers &#10;26.19   who wish to compare premium charges and loss ratios.&#10;26.20   (d) Each sale of a policy or certificate that does not comply with the loss ratio &#10;26.21   requirements of this section is an unfair or deceptive act or practice in the business of &#10;26.22   insurance and is subject to the penalties in sections 72A.17 to 72A.32.&#10;26.23   (e)(1) For purposes of this section, health care policies issued as a result of &#10;26.24   solicitations of individuals through the mail or mass media advertising, including both &#10;26.25   print and broadcast advertising, shall be treated as individual policies.&#10;26.26   (2) For purposes of this section, (i) "health care policy" or "health care certificate" &#10;26.27   is a health plan as defined in section 62A.011; and (ii) "health carrier" has the meaning &#10;26.28   given in section 62A.011 and includes all health carriers delivering or issuing for delivery &#10;26.29   health care policies or certificates in this state or offering these policies or certificates &#10;26.30   to residents of this state.&#10;26.31   (f) The loss ratio phase-in as described in paragraph (a) does not apply to individual &#10;26.32   policies and small employer policies issued by a health plan company that is assessed less &#10;26.33   than three percent of the total annual amount assessed by the Minnesota Comprehensive &#10;26.34   Health Association.  These policies must meet a 68 percent loss ratio for individual &#10;26.35   policies, a 71 percent loss ratio for small employer policies with fewer than ten employees, &#10;26.36   and a 75 percent loss ratio for all other small employer policies.&#10;27.1    (g) Notwithstanding paragraphs (a) and (f), the loss ratio shall be 60 percent for a &#10;27.2    health plan as defined in section 62A.011, offered by an insurance company licensed under &#10;27.3    chapter 60A that is assessed less than ten percent of the total annual amount assessed &#10;27.4    by the Minnesota Comprehensive Health Association.  For purposes of the percentage &#10;27.5    calculation of the association's assessments, an insurance company's assessments include &#10;27.6    those of its affiliates.&#10;27.7    (h) The commissioners of commerce and health shall each annually issue a &#10;27.8    public report listing, by health plan company, the actual loss ratios experienced in the &#10;27.9    individual and small employer markets in this state by the health plan companies that the &#10;27.10   commissioners respectively regulate.  The commissioners shall coordinate release of these &#10;27.11   reports so as to release them as a joint report or as separate reports issued the same day. &#10;27.12   The report or reports shall be released no later than June 1 for loss ratios experienced for &#10;27.13   the preceding calendar year.  Health plan companies shall provide to the commissioners &#10;27.14   any information requested by the commissioners for purposes of this paragraph. &#10;&#10;<a id="go.0.10.0"></a>27.15       Sec. 10. Minnesota Statutes 2004, section 62A.095, subdivision 1, is amended to read:&#10;27.16       Subdivision 1. <b>Applicability.</b> (a) No health plan shall be offered, sold, or issued to a &#10;27.17   resident of this state, or to cover a resident of this state, unless the health plan complies &#10;27.18   with subdivision 2.&#10;27.19   (b) Health plans providing benefits under health care programs administered by the &#10;27.20   commissioner of human services are not subject to the limits described in subdivision &#10;27.21   2 but are subject to the right of subrogation provisions under section  256B.37 and the &#10;27.22   lien provisions under section  256.015;  256B.042;  256D.03, subdivision 8; or  256L.03, &#10;27.23   subdivision 6. &#10;27.24   <ins>For purposes of this section, "health plan" includes coverage that is excluded under </ins>&#10;27.25   <ins>section 62A.011, subdivision 3, clauses (4), (7), and (10).</ins>&#10;&#10;<a id="go.0.11.0"></a>27.26       Sec. 11. Minnesota Statutes 2004, section 62A.27, is amended to read:&#10;27.27   <b>62A.27 COVERAGE OF ADOPTED CHILDREN.</b>&#10;27.28   (a) A health plan that provides coverage to a Minnesota resident must cover adopted &#10;27.29   children of the insured, subscriber, participant, or enrollee on the same basis as other &#10;27.30   dependents. Consequently, the plan shall not contain any provision concerning preexisting &#10;27.31   condition limitations, insurability, eligibility, or health underwriting approval concerning &#10;27.32   children placed for adoption with the participant.&#10;27.33   (b) The coverage required by this section is effective from the date of placement &#10;27.34   for adoption. For purposes of this section, placement for adoption means the assumption &#10;28.1    and retention by a person of a legal obligation for total or partial support of a child in &#10;28.2    anticipation of adoption of the child. The child's placement with a person terminates upon &#10;28.3    the termination of the legal obligation for total or partial support.&#10;28.4    (c) For the purpose of this section, health plan includes:&#10;28.5    (1) coverage offered by community integrated service networks;&#10;28.6    (2) coverage that is designed solely to provide dental or vision care; and&#10;28.7    (3) any plan under the federal Employee Retirement Income Security Act of 1974 &#10;28.8    (ERISA), United States Code, title 29, sections 1001 to 1461.&#10;28.9    <ins>(d) No policy or contract covered by this section may require notification to a health </ins>&#10;28.10   <ins>carrier as a condition for this dependent coverage. However, if the policy or contract </ins>&#10;28.11   <ins>mandates an additional premium for each dependent, the health carrier is entitled to </ins>&#10;28.12   <ins>all premiums that would have been collected had the health carrier been aware of the </ins>&#10;28.13   <ins>additional dependent. The health carrier may withhold payment of any health benefits </ins>&#10;28.14   <ins>for the new dependent until it has been compensated with the applicable premium </ins>&#10;28.15   <ins>which would have been owed if the health carrier had been informed of the additional </ins>&#10;28.16   <ins>dependent immediately.</ins>&#10;&#10;<a id="go.0.12.0"></a>28.17       Sec. 12. Minnesota Statutes 2004, section 62A.3093, is amended to read:&#10;28.18   <b>62A.3093 COVERAGE FOR DIABETES.</b>&#10;28.19       <ins>Subdivision 1.</ins> <ins><b>Required coverage.</b></ins> A health plan, including a plan providing the &#10;28.20   coverage specified in section  62A.011, subdivision 3, clause (10), must provide coverage &#10;28.21   for: (1) all physician prescribed medically appropriate and necessary equipment and &#10;28.22   supplies used in the management and treatment of diabetes; and (2) diabetes outpatient &#10;28.23   self-management training and education, including medical nutrition therapy, that is &#10;28.24   provided by a certified, registered, or licensed health care professional working in a &#10;28.25   program consistent with the national standards of diabetes self-management education as &#10;28.26   established by the American Diabetes Association. Coverage must include persons with &#10;28.27   gestational, type I or type II diabetes. Coverage required under this section is subject to &#10;28.28   the same deductible or coinsurance provisions applicable to the plan's hospital, medical &#10;28.29   expense, medical equipment, or prescription drug benefits. A health carrier may not &#10;28.30   reduce or eliminate coverage due to this requirement. &#10;28.31       <ins>Subd. 2.</ins> <ins><b>Medicare Part D exception.</b></ins> <ins>A health plan providing the coverage </ins>&#10;28.32   <ins>specified in section 62A.011, subdivision 3, clause (10), is not subject to the requirements </ins>&#10;28.33   <ins>of subdivision 1, clause (1), with respect to equipment and supplies covered under the </ins>&#10;28.34   <ins>Medicare Part D Prescription Drug program, whether or not the covered person is enrolled </ins>&#10;28.35   <ins>in a Medicare Part D plan.</ins>&#10;29.1    <ins>This subdivision does not apply to a health plan providing the coverage specified in </ins>&#10;29.2    <ins>section 62A.011, subdivision 3, clause (10), that was in effect on December 31, 2005, if the </ins>&#10;29.3    <ins>covered person remains enrolled in the plan and does not enroll in a Medicare Part D plan.</ins>&#10;29.4    <ins><b>EFFECTIVE DATE.</b></ins><ins>This section is effective retroactive to January 1, 2006.</ins>&#10;&#10;<a id="go.0.13.0"></a>29.5        Sec. 13. Minnesota Statutes 2005 Supplement, section 62A.316, is amended to read:&#10;29.6    <b>62A.316 BASIC MEDICARE SUPPLEMENT PLAN; COVERAGE.</b>&#10;29.7    (a) The basic Medicare supplement plan must have a level of coverage that will &#10;29.8    provide:&#10;29.9    (1) coverage for all of the Medicare Part A inpatient hospital coinsurance amounts, &#10;29.10   and 100 percent of all Medicare part A eligible expenses for hospitalization not covered &#10;29.11   by Medicare, after satisfying the Medicare Part A deductible;&#10;29.12   (2) coverage for the daily co-payment amount of Medicare Part A eligible expenses &#10;29.13   for the calendar year incurred for skilled nursing facility care;&#10;29.14   (3) coverage for the coinsurance amount, or in the case of outpatient department &#10;29.15   services paid under a prospective payment system, the co-payment amount, of Medicare &#10;29.16   eligible expenses under Medicare Part B regardless of hospital confinement, subject to &#10;29.17   the Medicare Part B deductible amount;&#10;29.18   (4) 80 percent of the hospital and medical expenses and supplies incurred during &#10;29.19   travel outside the United States as a result of a medical emergency;&#10;29.20   (5) coverage for the reasonable cost of the first three pints of blood, or equivalent &#10;29.21   quantities of packed red blood cells as defined under federal regulations under Medicare &#10;29.22   Parts A and B, unless replaced in accordance with federal regulations;&#10;29.23   (6) 100 percent of the cost of immunizations not otherwise covered under Part D of &#10;29.24   the Medicare program and routine screening procedures for cancer screening including &#10;29.25   mammograms and pap smears; and&#10;29.26   (7) 80 percent of coverage for all physician prescribed medically appropriate and &#10;29.27   necessary equipment and supplies used in the management and treatment of diabetes &#10;29.28   not otherwise covered under Part D of the Medicare program. Coverage must include &#10;29.29   persons with gestational, type I, or type II diabetes.<ins> Coverage under this clause is subject </ins>&#10;29.30   <ins>to section 62A.3093, subdivision 2. </ins>&#10;29.31   (b) Only the following optional benefit riders may be added to this plan:&#10;29.32   (1) coverage for all of the Medicare Part A inpatient hospital deductible amount;&#10;30.1    (2) a minimum of 80 percent of eligible medical expenses and supplies not covered &#10;30.2    by Medicare Part B, not to exceed any charge limitation established by the Medicare &#10;30.3    program or state law;&#10;30.4    (3) coverage for all of the Medicare Part B annual deductible;&#10;30.5    (4) coverage for at least 50 percent, or the equivalent of 50 percent, of usual and &#10;30.6    customary prescription drug expenses. An outpatient prescription drug benefit must not &#10;30.7    be included for sale or issuance in a Medicare policy or certificate issued on or after &#10;30.8    January 1, 2006;&#10;30.9    (5) preventive medical care benefit coverage for the following preventative health &#10;30.10   services not covered by Medicare:&#10;30.11   (i) an annual clinical preventive medical history and physical examination that may &#10;30.12   include tests and services from clause (ii) and patient education to address preventive &#10;30.13   health care measures;&#10;30.14   (ii) preventive screening tests or preventive services, the selection and frequency of &#10;30.15   which is determined to be medically appropriate by the attending physician.&#10;30.16   Reimbursement shall be for the actual charges up to 100 percent of the &#10;30.17   Medicare-approved amount for each service, as if Medicare were to cover the service as &#10;30.18   identified in American Medical Association current procedural terminology (AMA CPT) &#10;30.19   codes, to a maximum of $120 annually under this benefit. This benefit shall not include &#10;30.20   payment for a procedure covered by Medicare;&#10;30.21   (6) coverage for services to provide short-term at-home assistance with activities of &#10;30.22   daily living for those recovering from an illness, injury, or surgery:&#10;30.23   (i) For purposes of this benefit, the following definitions apply:&#10;30.24   (A) "activities of daily living" include, but are not limited to, bathing, dressing, &#10;30.25   personal hygiene, transferring, eating, ambulating, assistance with drugs that are normally &#10;30.26   self-administered, and changing bandages or other dressings;&#10;30.27   (B) "care provider" means a duly qualified or licensed home health aide/homemaker, &#10;30.28   personal care aid, or nurse provided through a licensed home health care agency or &#10;30.29   referred by a licensed referral agency or licensed nurses registry;&#10;30.30   (C) "home" means a place used by the insured as a place of residence, provided &#10;30.31   that the place would qualify as a residence for home health care services covered by &#10;30.32   Medicare. A hospital or skilled nursing facility shall not be considered the insured's &#10;30.33   place of residence;&#10;30.34   (D) "at-home recovery visit" means the period of a visit required to provide at-home &#10;30.35   recovery care, without limit on the duration of the visit, except each consecutive four &#10;30.36   hours in a 24-hour period of services provided by a care provider is one visit;&#10;31.1    (ii) Coverage requirements and limitations:&#10;31.2    (A) at-home recovery services provided must be primarily services that assist in &#10;31.3    activities of daily living;&#10;31.4    (B) the insured's attending physician must certify that the specific type and &#10;31.5    frequency of at-home recovery services are necessary because of a condition for which a &#10;31.6    home care plan of treatment was approved by Medicare;&#10;31.7    (C) coverage is limited to:&#10;31.8    (I) no more than the number and type of at-home recovery visits certified as &#10;31.9    necessary by the insured's attending physician. The total number of at-home recovery &#10;31.10   visits shall not exceed the number of Medicare-approved home care visits under a &#10;31.11   Medicare-approved home care plan of treatment;&#10;31.12   (II) the actual charges for each visit up to a maximum reimbursement of $40 per visit;&#10;31.13   (III) $1,600 per calendar year;&#10;31.14   (IV) seven visits in any one week;&#10;31.15   (V) care furnished on a visiting basis in the insured's home;&#10;31.16   (VI) services provided by a care provider as defined in this section;&#10;31.17   (VII) at-home recovery visits while the insured is covered under the policy or &#10;31.18   certificate and not otherwise excluded;&#10;31.19   (VIII) at-home recovery visits received during the period the insured is receiving &#10;31.20   Medicare-approved home care services or no more than eight weeks after the service date &#10;31.21   of the last Medicare-approved home health care visit;&#10;31.22   (iii) Coverage is excluded for:&#10;31.23   (A) home care visits paid for by Medicare or other government programs; and&#10;31.24   (B) care provided by family members, unpaid volunteers, or providers who are &#10;31.25   not care providers;&#10;31.26   (7) coverage for at least 50 percent, or the equivalent of 50 percent, of usual and &#10;31.27   customary prescription drug expenses to a maximum of $1,200 paid by the issuer annually &#10;31.28   under this benefit. An issuer of Medicare supplement insurance policies that elects to &#10;31.29   offer this benefit rider shall also make available coverage that contains the rider specified &#10;31.30   in clause (4). An outpatient prescription drug benefit must not be included for sale or &#10;31.31   issuance in a Medicare policy or certificate issued on or after January 1, 2006.&#10;31.32   <ins><b>EFFECTIVE DATE.</b></ins><ins>This section is effective retroactively from January 1, 2006.</ins>&#10;&#10;<a id="go.0.14.0"></a>31.33       Sec. 14. <ins><b>[62A.3161] MEDICARE SUPPLEMENT PLAN WITH 50 PERCENT </b></ins>&#10;31.34   <ins><b>COVERAGE.</b></ins>&#10;32.1    <ins>The Medicare supplement plan with 50 percent coverage must have a level of </ins>&#10;32.2    <ins>coverage that will provide:</ins>&#10;32.3    <ins>(1) 100 percent of Medicare Part A hospitalization coinsurance plus coverage for </ins>&#10;32.4    <ins>365 days after Medicare benefits end;</ins>&#10;32.5    <ins>(2) coverage for 50 percent of the Medicare Part A inpatient hospital deductible </ins>&#10;32.6    <ins>amount per benefit period until the out-of-pocket limitation is met as described in clause </ins>&#10;32.7    <ins>(8);</ins>&#10;32.8    <ins>(3) coverage for 50 percent of the coinsurance amount for each day used from the </ins>&#10;32.9    <ins>21st through the 100th day in a Medicare benefit period for posthospital skilled nursing </ins>&#10;32.10   <ins>care eligible under Medicare Part A until the out-of-pocket limitation is met as described </ins>&#10;32.11   <ins>in clause (8);</ins>&#10;32.12   <ins>(4) coverage for 50 percent of cost sharing for all Medicare Part A eligible expenses </ins>&#10;32.13   <ins>and respite care until the out-of-pocket limitation is met as described in clause (8);</ins>&#10;32.14   <ins>(5) coverage for 50 percent, under Medicare Part A or B, of the reasonable cost </ins>&#10;32.15   <ins>of the first three pints of blood, or equivalent quantities of packed red blood cells, as </ins>&#10;32.16   <ins>defined under federal regulations, unless replaced according to federal regulations, until </ins>&#10;32.17   <ins>the out-of-pocket limitation is met as described in clause (8);</ins>&#10;32.18   <ins>(6) except for coverage provided in this clause, coverage for 50 percent of the </ins>&#10;32.19   <ins>cost sharing otherwise applicable under Medicare Part B, after the policyholder pays </ins>&#10;32.20   <ins>the Medicare Part B deductible, until the out-of-pocket limitation is met as described </ins>&#10;32.21   <ins>in clause (8);</ins>&#10;32.22   <ins>(7) coverage of 100 percent of the cost sharing for Medicare Part B preventive </ins>&#10;32.23   <ins>services and diagnostic procedures for cancer screening described in section 62A.30 after </ins>&#10;32.24   <ins>the policyholder pays the Medicare Part B deductible; and</ins>&#10;32.25   <ins>(8) coverage of 100 percent of all cost sharing under Medicare Parts A and B for the </ins>&#10;32.26   <ins>balance of the calendar year after the individual has reached the out-of-pocket limitation </ins>&#10;32.27   <ins>on annual expenditures under Medicare Parts A and B of $4,000 in 2006, indexed </ins>&#10;32.28   <ins>each year by the appropriate inflation adjustment by the secretary of the United States </ins>&#10;32.29   <ins>Department of Health and Human Services.</ins>&#10;&#10;<a id="go.0.15.0"></a>32.30       Sec. 15. <ins><b>[62A.3162] MEDICARE SUPPLEMENT PLAN WITH 75 PERCENT </b></ins>&#10;32.31   <ins><b>COVERAGE.</b></ins>&#10;32.32   <ins>The basic Medicare supplement plan with 75 percent coverage must have a level of </ins>&#10;32.33   <ins>coverage that will provide:</ins>&#10;32.34   <ins>(1) 100 percent of Medicare Part A hospitalization coinsurance plus coverage for </ins>&#10;32.35   <ins>365 days after Medicare benefits end;</ins>&#10;33.1    <ins>(2) coverage for 75 percent of the Medicare Part A inpatient hospital deductible </ins>&#10;33.2    <ins>amount per benefit period until the out-of-pocket limitation is met as described in clause </ins>&#10;33.3    <ins>(8);</ins>&#10;33.4    <ins>(3) coverage for 75 percent of the coinsurance amount for each day used from the </ins>&#10;33.5    <ins>21st through the 100th day in a Medicare benefit period for posthospital skilled nursing </ins>&#10;33.6    <ins>care eligible under Medicare Part A until the out-of-pocket limitation is met as described </ins>&#10;33.7    <ins>in clause (8); </ins>&#10;33.8    <ins>(4) coverage for 75 percent of cost sharing for all Medicare Part A eligible expenses </ins>&#10;33.9    <ins>and respite care until the out-of-pocket limitation is met as described in clause (8);</ins>&#10;33.10   <ins>(5) coverage for 75 percent, under Medicare Part A or B, of the reasonable cost </ins>&#10;33.11   <ins>of the first three pints of blood, or equivalent quantities of packed red blood cells, as </ins>&#10;33.12   <ins>defined under federal regulations, unless replaced according to federal regulations until </ins>&#10;33.13   <ins>the out-of-pocket limitation is met as described in clause (8);</ins>&#10;33.14   <ins>(6) except for coverage provided in this clause, coverage for 75 percent of the </ins>&#10;33.15   <ins>cost sharing otherwise applicable under Medicare Part B after the policyholder pays </ins>&#10;33.16   <ins>the Medicare Part B deductible until the out-of-pocket limitation is met as described </ins>&#10;33.17   <ins>in clause (8);</ins>&#10;33.18   <ins>(7) coverage of 100 percent of the cost sharing for Medicare Part B preventive </ins>&#10;33.19   <ins>services and diagnostic procedures for cancer screening described in section 62A.30 after </ins>&#10;33.20   <ins>the policyholder pays the Medicare Part B deductible; and</ins>&#10;33.21   <ins>(8) coverage of 100 percent of all cost sharing under Medicare Parts A and B for the </ins>&#10;33.22   <ins>balance of the calendar year after the individual has reached the out-of-pocket limitation </ins>&#10;33.23   <ins>on annual expenditures under Medicare Parts A and B of $2,000 in 2006, indexed </ins>&#10;33.24   <ins>each year by the appropriate inflation adjustment by the Secretary of the United States </ins>&#10;33.25   <ins>Department of Health and Human Services.</ins>&#10;&#10;<a id="go.0.16.0"></a>33.26       Sec. 16. Minnesota Statutes 2004, section 62A.65, subdivision 3, is amended to read:&#10;33.27       Subd. 3. <b>Premium rate restrictions.</b> No individual health plan may be offered, &#10;33.28   sold, issued, or renewed to a Minnesota resident unless the premium rate charged is &#10;33.29   determined in accordance with the following requirements:&#10;33.30   (a) Premium rates must be no more than 25 percent above and no more than 25 &#10;33.31   percent below the index rate charged to individuals for the same or similar coverage, &#10;33.32   adjusted pro rata for rating periods of less than one year. The premium variations &#10;33.33   permitted by this paragraph must be based only upon health status, claims experience, &#10;33.34   and occupation. For purposes of this paragraph, health status includes refraining from &#10;33.35   tobacco use or other actuarially valid lifestyle factors associated with good health, &#10;34.1    provided that the lifestyle factor and its effect upon premium rates have been determined &#10;34.2    by the commissioner to be actuarially valid and have been approved by the commissioner. &#10;34.3    Variations permitted under this paragraph must not be based upon age or applied &#10;34.4    differently at different ages. This paragraph does not prohibit use of a constant percentage &#10;34.5    adjustment for factors permitted to be used under this paragraph.&#10;34.6    (b) Premium rates may vary based upon the ages of covered persons only as &#10;34.7    provided in this paragraph. In addition to the variation permitted under paragraph (a), &#10;34.8    each health carrier may use an additional premium variation based upon age of up to &#10;34.9    plus or minus 50 percent of the index rate.&#10;34.10   (c) A health carrier may request approval by the commissioner to establish <del>no </del>&#10;34.11   <del>more than three</del><ins> separate</ins> geographic regions<ins> determined by the health carrier</ins> and to &#10;34.12   establish separate index rates for each <ins>such </ins>region<del>, provided that the index rates do not </del>&#10;34.13   <del>vary between any two regions by more than 20 percent. Health carriers that do not do </del>&#10;34.14   <del>business in the Minneapolis/St. Paul metropolitan area may request approval for no </del>&#10;34.15   <del>more than two geographic regions, and clauses (2) and (3) do not apply to approval of </del>&#10;34.16   <del>requests made by those health carriers</del>. The commissioner <del>may</del><ins> shall</ins> grant approval if the &#10;34.17   following conditions are met: (1) the geographic regions must be applied uniformly by &#10;34.18   the health carrier;&#10;34.19   <del>(2) one geographic region must be based on the Minneapolis/St. Paul metropolitan </del>&#10;34.20   <del>area;</del>&#10;34.21   <del>(3) for each geographic region that is rural, the index rate for that region must not </del>&#10;34.22   <del>exceed the index rate for the Minneapolis/St. Paul metropolitan area; and</del>&#10;34.23   <ins>(2) each geographic region must be composed of no fewer than seven counties that </ins>&#10;34.24   <ins>create a contiguous region; and</ins>&#10;34.25   <del>(4)</del><ins> (3)</ins> the health carrier provides actuarial justification acceptable to the &#10;34.26   commissioner for the proposed geographic variations in index rates, establishing that the &#10;34.27   variations are based upon differences in the cost to the health carrier of providing coverage.&#10;34.28   (d) Health carriers may use rate cells and must file with the commissioner the rate &#10;34.29   cells they use. Rate cells must be based upon the number of adults or children covered &#10;34.30   under the policy and may reflect the availability of Medicare coverage. The rates for &#10;34.31   different rate cells must not in any way reflect generalized differences in expected costs &#10;34.32   between principal insureds and their spouses.&#10;34.33   (e) In developing its index rates and premiums for a health plan, a health carrier shall &#10;34.34   take into account only the following factors:&#10;34.35   (1) actuarially valid differences in rating factors permitted under paragraphs (a) &#10;34.36   and (b); and&#10;35.1    (2) actuarially valid geographic variations if approved by the commissioner as &#10;35.2    provided in paragraph (c).&#10;35.3    (f) All premium variations must be justified in initial rate filings and upon request of &#10;35.4    the commissioner in rate revision filings. All rate variations are subject to approval by &#10;35.5    the commissioner.&#10;35.6    (g) The loss ratio must comply with the section  62A.021 requirements for individual &#10;35.7    health plans. &#10;35.8    (h) The rates must not be approved, unless the commissioner has determined that the &#10;35.9    rates are reasonable. In determining reasonableness, the commissioner shall consider the &#10;35.10   growth rates applied under section  62J.04, subdivision 1, paragraph (b), to the calendar &#10;35.11   year or years that the proposed premium rate would be in effect, actuarially valid changes &#10;35.12   in risks associated with the enrollee populations, and actuarially valid changes as a result &#10;35.13   of statutory changes in Laws 1992, chapter 549. &#10;35.14   <ins>(i) An insurer may, as part of a minimum lifetime loss ratio guarantee filing under </ins>&#10;35.15   <ins>section 62A.02, subdivision 3a, include a rating practices guarantee as provided in this </ins>&#10;35.16   <ins>paragraph. The rating practices guarantee must be in writing and must guarantee that </ins>&#10;35.17   <ins>the policy form will be offered, sold, issued, and renewed only with premium rates and </ins>&#10;35.18   <ins>premium rating practices that comply with subdivisions 2, 3, 4, and 5. The rating practices </ins>&#10;35.19   <ins>guarantee must be accompanied by an actuarial memorandum that demonstrates that the </ins>&#10;35.20   <ins>premium rates and premium rating system used in connection with the policy form will </ins>&#10;35.21   <ins>satisfy the guarantee. The guarantee must guarantee refunds of any excess premiums to </ins>&#10;35.22   <ins>policyholders charged premiums that exceed those permitted under subdivision 2, 3, 4, </ins>&#10;35.23   <ins>or 5. An insurer that complies with this paragraph in connection with a policy form is </ins>&#10;35.24   <ins>exempt from the requirement of prior approval by the commissioner under paragraphs </ins>&#10;35.25   <ins>(c), (f), and (h).</ins>&#10;35.26   <ins><b>EFFECTIVE DATE.</b></ins><ins>The amendments to paragraph (c) of this section are effective </ins>&#10;35.27   <ins>January 1, 2007, and apply to policies issued or renewed on or after that date.</ins>&#10;&#10;<a id="go.0.17.0"></a>35.28       Sec. 17. Minnesota Statutes 2004, section 62C.14, subdivision 9, is amended to read:&#10;35.29       Subd. 9. <b>Required filing.</b> No service plan corporation shall deliver or issue &#10;35.30   for delivery in this state any subscriber contract, endorsement, rider, amendment or &#10;35.31   application until a copy of the form thereof has been filed with the commissioner, subject &#10;35.32   to disapproval by the commissioner. Any such form issued or in use on August 1, 1971, if &#10;35.33   filed with the commissioner within 60 days after August 1, 1971, shall be deemed filed &#10;35.34   upon receipt by the commissioner. <ins>When an insurer, service plan corporation, or the </ins>&#10;35.35   <ins>Minnesota Comprehensive Health Association fails to respond to an objection or inquiry </ins>&#10;36.1    <ins>within 60 days, the filing is automatically disapproved. A resubmission is required if </ins>&#10;36.2    <ins>action by the Department of Commerce is subsequently requested. An additional filing </ins>&#10;36.3    <ins>fee is required for the resubmission. </ins>The commissioner also may by regulation exempt &#10;36.4    from filing those subscriber contracts issued to a group of not less than 300 subscribers, &#10;36.5    or to other groups upon such reasonable conditions and restrictions as the commissioner &#10;36.6    may require.&#10;&#10;<a id="go.0.18.0"></a>36.7        Sec. 18. Minnesota Statutes 2004, section 62C.14, subdivision 10, is amended to read:&#10;36.8        Subd. 10. <b>Filing or disapproval.</b> Except as otherwise provided in subdivision 9, &#10;36.9    all forms received by the commissioner shall be deemed filed 60 days after received &#10;36.10   unless disapproved by order transmitted to the corporation stating that the form used in a &#10;36.11   specified respect is contrary to law, contains a provision or provisions which are unfair, &#10;36.12   inequitable, misleading, inconsistent or ambiguous, or is in part illegible. It shall be &#10;36.13   unlawful to issue or use a document disapproved by the commissioner.<ins> When an insurer, </ins>&#10;36.14   <ins>service plan corporation, or the Minnesota Comprehensive Health Association fails to </ins>&#10;36.15   <ins>respond to an objection or inquiry within 60 days, the filing is automatically disapproved. </ins>&#10;36.16   <ins>A resubmission is required if action by the Department of Commerce is subsequently </ins>&#10;36.17   <ins>requested. An additional filing fee is required for the resubmission.</ins>&#10;&#10;<a id="go.0.19.0"></a>36.18       Sec. 19. Minnesota Statutes 2004, section 62E.13, subdivision 3, is amended to read:&#10;36.19       Subd. 3. <b>Duties of writing carrier.</b> The writing carrier shall perform all &#10;36.20   administrative and claims payment functions required by this section. The writing carrier &#10;36.21   shall provide these services for a period of <del>three</del><ins> five</ins> years, unless a request to terminate &#10;36.22   is approved by the commissioner. The commissioner shall approve or deny a request to &#10;36.23   terminate within 90 days of its receipt. A failure to make a final decision on a request to &#10;36.24   terminate within the specified period shall be deemed to be an approval. Six months &#10;36.25   prior to the expiration of each <del>three-year</del><ins> five-year</ins> period, the association shall invite &#10;36.26   submissions of policy forms from members of the association, including the writing &#10;36.27   carrier. The association shall follow the provisions of subdivision 2 in selecting a writing &#10;36.28   carrier for the subsequent <del>three-year</del><ins> five-year</ins> period.&#10;&#10;<a id="go.0.20.0"></a>36.29       Sec. 20. Minnesota Statutes 2004, section 62E.14, subdivision 5, is amended to read:&#10;36.30       Subd. 5. <b>Terminated employees.</b> An employee who is voluntarily or involuntarily &#10;36.31   terminated or laid off from employment and unable to exercise the option to continue &#10;36.32   coverage under section  62A.17<ins>, and who is a Minnesota resident and who is otherwise </ins>&#10;36.33   <ins>eligible,</ins> may enroll<ins> in the comprehensive health insurance plan</ins>, by submitting an &#10;37.1    application that is received by the writing carrier no later than 90 days after termination or &#10;37.2    layoff, with a waiver of the preexisting condition limitation set forth in subdivision 3<del> and a </del>&#10;37.3    <del>waiver of the evidence of rejection set forth in subdivision 1, paragraph (c)</del>. &#10;37.4    <ins><b>EFFECTIVE DATE.</b></ins><ins>This section is effective the day following final enactment.</ins>&#10;&#10;<a id="go.0.21.0"></a>37.5        Sec. 21.  Minnesota Statutes 2005 Supplement, section 62J.052, is amended to read:&#10;37.6    <b>62J.052 PROVIDER COST DISCLOSURE.</b>&#10;37.7        <ins>Subdivision 1.</ins> <ins><b>Health care providers.</b></ins> (a) Each health care provider, as defined by &#10;37.8    section 62J.03, subdivision 8, except hospitals and outpatient surgical centers<ins> subject to </ins>&#10;37.9    <ins>the requirements of section 62J.823</ins>, shall provide the following information:&#10;37.10   (1) the average allowable payment from private third-party payers for the <del>20</del><ins> 50</ins> &#10;37.11   services or procedures most commonly performed;&#10;37.12   (2) the average payment rates for those services and procedures for medical &#10;37.13   assistance;&#10;37.14   (3) the average charge for those services and procedures for individuals who have no &#10;37.15   applicable private or public coverage; and&#10;37.16   (4) the average charge for those services and procedures, including all patients.&#10;37.17   (b) This information shall be updated annually and be readily available at no cost to &#10;37.18   the public on site.&#10;37.19       <ins>Subd. 2.</ins> <ins><b>Pharmacies.</b></ins> <ins>(a) Each pharmacy, as defined in section 151.01, subdivision </ins>&#10;37.20   <ins>2, shall provide the following information to a patient upon request:</ins>&#10;37.21   <ins>(1) the pharmacy's own usual and customary price for a prescription drug;</ins>&#10;37.22   <ins>(2) a record, including all transactions on record with the pharmacy both past and </ins>&#10;37.23   <ins>present, of all co-payments and other cost-sharing paid to the pharmacy by the patient </ins>&#10;37.24   <ins>for up to two years; and</ins>&#10;37.25   <ins>(3) the total amount of all co-payments and other cost-sharing paid to the pharmacy </ins>&#10;37.26   <ins>by the patient over the previous two years.</ins>&#10;37.27   <ins>(b) The information required under paragraph (a) must be readily available at no </ins>&#10;37.28   <ins>cost to the patient.</ins>&#10;37.29   <ins><b>EFFECTIVE DATE.</b></ins><ins>This section is effective October 1, 2006.</ins>&#10;&#10;<a id="go.0.22.0"></a>37.30       Sec. 22. Minnesota Statutes 2004, section 62J.60, subdivision 2, is amended to read:&#10;37.31       Subd. 2. <b>General characteristics.</b> (a) The Minnesota uniform health care &#10;37.32   identification card must be a preprinted card constructed of plastic, paper, or any other &#10;37.33   medium that conforms with ANSI and ISO 7810 physical characteristics standards. The &#10;38.1    card dimensions must also conform to ANSI and ISO 7810 physical characteristics &#10;38.2    standard. The use of a signature panel is optional. The uniform prescription drug &#10;38.3    information contained on the card must conform with the format adopted by the NCPDP &#10;38.4    and, except as provided in subdivision 3, paragraph (a), clause (2), must include all of &#10;38.5    the fields required to submit a claim in conformance with the most recent pharmacy &#10;38.6    identification card implementation guide produced by the NCPDP. All information &#10;38.7    required to submit a prescription drug claim, exclusive of information provided on a &#10;38.8    prescription that is required by law, must be included on the card in a clear, readable, and &#10;38.9    understandable manner. If a health benefit plan requires a conditional or situational field, &#10;38.10   as defined by the NCPDP, the conditional or situational field must conform to the most &#10;38.11   recent pharmacy information card implementation guide produced by the NCPDP.&#10;38.12   (b) The Minnesota uniform health care identification card must have an essential &#10;38.13   information window on the front side with the following data elements <del>left justified in </del>&#10;38.14   <del>the following top to bottom sequence</del>: card issuer name, electronic transaction routing &#10;38.15   information, card issuer identification number, cardholder (insured) identification number, &#10;38.16   and cardholder (insured) identification name. No optional data may be interspersed &#10;38.17   between these data elements. <del>The window must be left justified.</del>&#10;38.18   (c) Standardized labels are required next to human readable data elements <del>and must </del>&#10;38.19   <del>come before the human readable data elements</del>.&#10;&#10;<a id="go.0.23.0"></a>38.20       Sec. 23. Minnesota Statutes 2004, section 62J.60, subdivision 3, is amended to read:&#10;38.21       Subd. 3. <b>Human readable data elements.</b> (a) The following are the minimum &#10;38.22   human readable data elements that must be present on the front side of the Minnesota &#10;38.23   uniform health care identification card:&#10;38.24   (1) card issuer name or logo, which is the name or logo that identifies the card issuer. &#10;38.25   The card issuer name or logo may be located at the top of the card. No standard label &#10;38.26   is required for this data element;&#10;38.27   (2) complete electronic transaction routing information including, at a minimum, &#10;38.28   the international identification number. The standardized label of this data element &#10;38.29   is "RxBIN." Processor control numbers and group numbers are required if needed to &#10;38.30   electronically process a prescription drug claim. The standardized label for the process &#10;38.31   control numbers data element is "RxPCN" and the standardized label for the group &#10;38.32   numbers data element is "RxGrp," except that if the group number data element is a &#10;38.33   universal element to be used by all health care providers, the standardized label may be &#10;38.34   "Grp." To conserve vertical space on the card, the international identification number and &#10;38.35   the processor control number may be printed on the same line;&#10;39.1    (3) <del>card issuer identification number. The standardized label for this element is </del>&#10;39.2    <del>"Issuer";</del>&#10;39.3    <del>(4)</del> cardholder (insured) identification number, which is the unique identification &#10;39.4    number of the individual card holder established and defined under this section. The &#10;39.5    standardized label for the data element is "ID";&#10;39.6    <del>(5)</del> <ins>(4) </ins>cardholder (insured) identification name, which is the name of the individual &#10;39.7    card holder. The identification name must be formatted as follows: first name, space, &#10;39.8    optional middle initial, space, last name, optional space and name suffix. The standardized &#10;39.9    label for this data element is "Name";&#10;39.10   <del>(6)</del> <ins>(5) </ins>care type, which is the description of the group purchaser's plan product &#10;39.11   under which the beneficiary is covered. The description shall include the health plan &#10;39.12   company name and the plan or product name. The standardized label for this data element &#10;39.13   is "Care Type";&#10;39.14   <del>(7)</del> <ins>(6) </ins>service type, which is the description of coverage provided such as hospital, &#10;39.15   dental, vision, prescription, or mental health<del>. The standard label for this data element </del>&#10;39.16   <del>is "Svc Type"</del>; and&#10;39.17   <del>(8)</del> <ins>(7) </ins>provider/clinic name, which is the name of the primary care clinic the card &#10;39.18   holder is assigned to by the health plan company. The standard label for this field is &#10;39.19   "PCP." This information is mandatory only if the health plan company assigns a specific &#10;39.20   primary care provider to the card holder.&#10;39.21   (b) The following human readable data elements shall be present on the back side &#10;39.22   of the Minnesota uniform health care identification card. These elements must be left &#10;39.23   justified, and no optional data elements may be interspersed between them:&#10;39.24   (1) claims submission names and addresses, which are the names and addresses of &#10;39.25   the entity or entities to which claims should be submitted. If different destinations are &#10;39.26   required for different types of claims, this must be labeled;&#10;39.27   (2) telephone numbers and names that pharmacies and other health care providers &#10;39.28   may call for assistance. These telephone numbers and names are required on the back &#10;39.29   side of the card only if one of the contacts listed in clause (3) cannot provide pharmacies &#10;39.30   or other providers with assistance or with the telephone numbers and names of contacts &#10;39.31   for assistance; and&#10;39.32   (3) telephone numbers and names; which are the telephone numbers and names of the &#10;39.33   following contacts with a standardized label describing the service function as applicable:&#10;39.34   (i) eligibility and benefit information;&#10;39.35   (ii) utilization review;&#10;39.36   (iii) precertification; or&#10;40.1    (iv) customer services.&#10;40.2    (c) The following human readable data elements are mandatory on the back &#10;40.3    side of the Minnesota uniform health care identification card for health maintenance &#10;40.4    organizations:&#10;40.5    (1) emergency care authorization telephone number or instruction on how to receive &#10;40.6    authorization for emergency care. There is no standard label required for this information; &#10;40.7    and&#10;40.8    (2) one of the following:&#10;40.9    (i) telephone number to call to appeal to or file a complaint with the commissioner of &#10;40.10   health; or&#10;40.11   (ii) for persons enrolled under section  256B.69,  256D.03, or  256L.12, the telephone &#10;40.12   number to call to file a complaint with the ombudsperson designated by the commissioner &#10;40.13   of human services under section  256B.69 and the address to appeal to the commissioner of &#10;40.14   human services. There is no standard label required for this information. &#10;40.15   (d) All human readable data elements not required under paragraphs (a) to (c) are &#10;40.16   optional and may be used at the issuer's discretion.&#10;&#10;<a id="go.0.24.0"></a>40.17       Sec. 24. Minnesota Statutes 2004, section 62J.81, subdivision 1, is amended to read:&#10;40.18       Subdivision 1. <b>Required disclosure of estimated payment.</b> <ins>(a) </ins>A health care &#10;40.19   provider, as defined in section  62J.03, subdivision 8, <ins>or the provider's designee as agreed </ins>&#10;40.20   <ins>to by that designee, </ins>shall, at the request of a consumer, provide that consumer with a good &#10;40.21   faith estimate of the reimbursement the provider expects to receive from the health plan &#10;40.22   company in which the consumer is enrolled. Health plan companies must allow contracted &#10;40.23   providers<ins>, or their designee,</ins> to release this information. A good faith estimate must also be &#10;40.24   made available at the request of a consumer who is not enrolled in a health plan company. &#10;40.25   Payment information provided by a provider<ins>, or by the provider's designee as agreed to </ins>&#10;40.26   <ins>by that designee,</ins> to a patient pursuant to this subdivision does not constitute a legally &#10;40.27   binding estimate of the cost of services. &#10;40.28   <ins>(b) A health plan company, as defined in section 62J.03, subdivision 10, shall, at </ins>&#10;40.29   <ins>the request of an enrollee or the enrollee's designee, provide that enrollee with a good </ins>&#10;40.30   <ins>faith estimate of the reimbursement the health plan company would expect to pay to a </ins>&#10;40.31   <ins>specified provider within the network for a health care service specified by the enrollee. If </ins>&#10;40.32   <ins>requested by the enrollee, the health plan company shall also provide to the enrollee a </ins>&#10;40.33   <ins>good faith estimate of the enrollee's out-of-pocket cost for the health care service. An </ins>&#10;40.34   <ins>estimate provided to an enrollee under this paragraph is not a legally binding estimate of </ins>&#10;40.35   <ins>the reimbursement or out-of-pocket cost.</ins>&#10;41.1    <ins><b>EFFECTIVE DATE.</b></ins><ins>Paragraph (a) is effective the day following final enactment. </ins>&#10;41.2    <ins>Paragraph (b) is effective January 1, 2007.</ins>&#10;&#10;<a id="go.0.25.0"></a>41.3        Sec. 25. <ins><b>[62J.823] HOSPITAL PRICING TRANSPARENCY.</b></ins>&#10;41.4        <ins>Subdivision 1.</ins> <ins><b>Short title.</b></ins> <ins>This section may be cited as the Hospital Pricing </ins>&#10;41.5    <ins>Transparency Act.</ins>&#10;41.6        <ins>Subd. 2.</ins> <ins><b>Definition.</b></ins> <ins>For the purposes of this section, "estimate" means the actual </ins>&#10;41.7    <ins>price expected to be billed to the individual or to the individual's health plan company </ins>&#10;41.8    <ins>based on the specific diagnostic-related group code or specific procedure code or codes, </ins>&#10;41.9    <ins>reflecting any known discounts the individual would receive. </ins>&#10;41.10       <ins>Subd. 3.</ins> <ins><b>Applicability and scope.</b></ins> <ins>Any hospital, as defined in section 144.696, </ins>&#10;41.11   <ins>subdivision 3, and outpatient surgical center, as defined in section 144.696, subdivision 4, </ins>&#10;41.12   <ins>shall provide a written estimate of the cost of a specific service or stay upon the request of </ins>&#10;41.13   <ins>a patient, doctor, or the patient's representative. The request must include: </ins>&#10;41.14   <ins>(1) the health coverage status of the patient, including the specific health plan or </ins>&#10;41.15   <ins>other health coverage under which the patient is enrolled, if any; and</ins>&#10;41.16   <ins>(2) at least one of the following:</ins>&#10;41.17   <ins>(i) the specific diagnostic-related group code; </ins>&#10;41.18   <ins>(ii) the name of the procedure or procedures to be performed; </ins>&#10;41.19   <ins>(iii) the type of treatment to be received; or</ins>&#10;41.20   <ins>(iv) any other information that will allow the hospital or outpatient surgical center to </ins>&#10;41.21   <ins>determine the specific diagnostic-related group or procedure code or codes.</ins>&#10;41.22       <ins>Subd. 4.</ins> <ins><b>Estimate.</b></ins> <ins>(a) An estimate provided by the hospital or outpatient surgical </ins>&#10;41.23   <ins>center must contain: </ins>&#10;41.24   <ins>(1) the method used to calculate the estimate; </ins>&#10;41.25   <ins>(2) the specific diagnostic-related group or procedure code or codes used to calculate </ins>&#10;41.26   <ins>the estimate, and a description of the diagnostic-related group or procedure code or codes </ins>&#10;41.27   <ins>that is reasonably understandable to a patient; and</ins>&#10;41.28   <ins>(3) a statement indicating that the estimate, while accurate, may not reflect the </ins>&#10;41.29   <ins>actual billed charges and that the final bill may be higher or lower depending on the </ins>&#10;41.30   <ins>patient's specific circumstances. </ins>&#10;41.31   <ins>(b) The estimate may be provided in any method that meets the needs of the patient </ins>&#10;41.32   <ins>and the hospital or outpatient surgical center, including electronically; however, a paper </ins>&#10;41.33   <ins>copy must be provided if specifically requested.</ins>&#10;41.34   <ins><b>EFFECTIVE DATE.</b></ins><ins>This section is effective October 1, 2006.</ins>&#10;&#10;<a id="go.0.26.0"></a>42.1        Sec. 26. <ins><b>[62J.83] REDUCED PAYMENT AMOUNTS PERMITTED.</b></ins>&#10;42.2    <ins>(a) Notwithstanding any provision of chapter 148 or any other provision of law to </ins>&#10;42.3    <ins>the contrary, a health care provider may provide care to a patient at a discounted payment </ins>&#10;42.4    <ins>amount, including care provided for free.</ins>&#10;42.5    <ins>(b) This section does not apply in a situation in which the discounted payment </ins>&#10;42.6    <ins>amount is not permitted under federal law.</ins>&#10;42.7    <ins><b>EFFECTIVE DATE.</b></ins><ins>This section is effective the day following final enactment.</ins>&#10;&#10;<a id="go.0.27.0"></a>42.8        Sec. 27. Minnesota Statutes 2004, section 62L.02, subdivision 24, is amended to read:&#10;42.9        Subd. 24. <b>Qualifying coverage.</b> "Qualifying coverage" means health benefits or &#10;42.10   health coverage provided under:&#10;42.11   (1) a health benefit plan, as defined in this section, but without regard to whether it is &#10;42.12   issued to a small employer and including blanket accident and sickness insurance, other &#10;42.13   than accident-only coverage, as defined in section  62A.11; &#10;42.14   (2) part A or part B of Medicare;&#10;42.15   (3) medical assistance under chapter 256B;&#10;42.16   (4) general assistance medical care under chapter 256D;&#10;42.17   (5) MCHA;&#10;42.18   (6) a self-insured health plan;&#10;42.19   (7) the MinnesotaCare program established under section  256L.02; &#10;42.20   (8) a plan provided under section  43A.316,  43A.317, or  471.617; &#10;42.21   (9) the Civilian Health and Medical Program of the Uniformed Services &#10;42.22   (CHAMPUS) or other coverage provided under United States Code, title 10, chapter 55;&#10;42.23   (10) coverage provided by a health care network cooperative under chapter 62R;&#10;42.24   (11) a medical care program of the Indian Health Service or of a tribal organization;&#10;42.25   (12) the federal Employees Health Benefits Plan, or other coverage provided under &#10;42.26   United States Code, title 5, chapter 89;&#10;42.27   (13) a health benefit plan under section 5(e) of the Peace Corps Act, codified as &#10;42.28   United States Code, title 22, section 2504(e);&#10;42.29   (14) a health plan; <del>or</del>&#10;42.30   (15) a plan similar to any of the above plans provided in this state or in another &#10;42.31   state as determined by the commissioner<del>.</del><ins>;</ins>&#10;42.32   <ins>(16) any plan established or maintained by a state, the United States government, or </ins>&#10;42.33   <ins>a foreign country, or any political subdivision of a state, the United States government, or a </ins>&#10;42.34   <ins>foreign country that provides health coverage to individuals who are enrolled in the plan; or</ins>&#10;42.35   <ins>(17) the State Children's Health Insurance Program (SCHIP).</ins>&#10;&#10;<a id="go.0.28.0"></a>43.1        Sec. 28. Minnesota Statutes 2004, section 62L.03, subdivision 3, is amended to read:&#10;43.2        Subd. 3. <b>Minimum participation and contribution.</b> (a) A small employer that has &#10;43.3    at least 75 percent of its eligible employees who have not waived coverage participating in &#10;43.4    a health benefit plan and that contributes at least 50 percent toward the cost of coverage of &#10;43.5    each eligible employee must be guaranteed coverage on a guaranteed issue basis from any &#10;43.6    health carrier participating in the small employer market. The participation level of eligible &#10;43.7    employees must be determined at the initial offering of coverage and at the renewal date &#10;43.8    of coverage. A health carrier must not increase the participation requirements applicable &#10;43.9    to a small employer at any time after the small employer has been accepted for coverage. &#10;43.10   For the purposes of this subdivision, waiver of coverage includes only waivers due to: (1) &#10;43.11   coverage under another group health plan; (2) coverage under Medicare Parts A and B; (3) &#10;43.12   coverage under MCHA permitted under section  62E.141; or (4) coverage under medical &#10;43.13   assistance under chapter 256B or general assistance medical care under chapter 256D. &#10;43.14   (b) If a small employer does not satisfy the contribution or participation requirements &#10;43.15   under this subdivision, a health carrier may voluntarily issue or renew individual health &#10;43.16   plans, or a health benefit plan which must fully comply with this chapter. A health carrier &#10;43.17   that provides a health benefit plan to a small employer that does not meet the contribution &#10;43.18   or participation requirements of this subdivision must maintain this information in its files &#10;43.19   for audit by the commissioner. A health carrier may not offer an individual health plan, &#10;43.20   purchased through an arrangement between the employer and the health carrier, to any &#10;43.21   employee unless the health carrier also offers the individual health plan, on a guaranteed &#10;43.22   issue basis, to all other employees of the same employer.<ins> An arrangement permitted under </ins>&#10;43.23   <ins>section 62L.12, subdivision 2, paragraph (k), is not an arrangement between the employer </ins>&#10;43.24   <ins>and the health carrier for purposes of this paragraph.</ins>&#10;43.25   (c) Nothing in this section obligates a health carrier to issue coverage to a small &#10;43.26   employer that currently offers coverage through a health benefit plan from another health &#10;43.27   carrier, unless the new coverage will replace the existing coverage and not serve as one &#10;43.28   of two or more health benefit plans offered by the employer. This paragraph does not &#10;43.29   apply if the small employer will meet the required participation level with respect to &#10;43.30   the new coverage.&#10;43.31   <ins><b>EFFECTIVE DATE.</b></ins><ins>This section is effective the day following final enactment.</ins>&#10;&#10;<a id="go.0.29.0"></a>43.32       Sec. 29. Minnesota Statutes 2004, section 62L.08, subdivision 4, is amended to read:&#10;43.33       Subd. 4. <b>Geographic premium variations.</b> A health carrier may request approval &#10;43.34   by the commissioner to establish <del>no more than three</del><ins> separate</ins> geographic regions<ins> </ins>&#10;43.35   <ins>determined by the health carrier</ins> and to establish separate index rates for each <ins>such </ins>region<del>, </del>&#10;44.1    <del>provided that the index rates do not vary between any two regions by more than 20 </del>&#10;44.2    <del>percent. Health carriers that do not do business in the Minneapolis/St. Paul metropolitan </del>&#10;44.3    <del>area may request approval for no more than two geographic regions, and clauses (2) and </del>&#10;44.4    <del>(3) do not apply to approval of requests made by those health carriers. A health carrier </del>&#10;44.5    <del>may also request approval to establish one or more additional geographic regions and one </del>&#10;44.6    <del>or more separate index rates for premiums for employees working and residing outside </del>&#10;44.7    <del>of Minnesota</del>. The commissioner <del>may</del><ins> shall</ins> grant approval if the following conditions &#10;44.8    are met:&#10;44.9    (1) the geographic regions must be applied uniformly by the health carrier;&#10;44.10   <del>(2) one geographic region must be based on the Minneapolis/St. Paul metropolitan </del>&#10;44.11   <del>area;</del>&#10;44.12   <del>(3) if one geographic region is rural, the index rate for the rural region must not </del>&#10;44.13   <del>exceed the index rate for the Minneapolis/St. Paul metropolitan area;</del>&#10;44.14   <ins>(2) each geographic region must be composed of no fewer than seven counties that </ins>&#10;44.15   <ins>create a contiguous region; and</ins>&#10;44.16   <del>(4)</del><ins> (3)</ins> the health carrier provides actuarial justification acceptable to the &#10;44.17   commissioner for the proposed geographic variations in index rates, establishing that the &#10;44.18   variations are based upon differences in the cost to the health carrier of providing coverage.&#10;44.19   <ins><b>EFFECTIVE DATE.</b></ins><ins>This section is effective January 1, 2007, and applies to </ins>&#10;44.20   <ins>policies issued or renewed on or after that date.</ins>&#10;&#10;<a id="go.0.30.0"></a>44.21       Sec. 30. Minnesota Statutes 2005 Supplement, section 62L.12, subdivision 2, is &#10;44.22   amended to read:&#10;44.23       Subd. 2. <b>Exceptions.</b> (a) A health carrier may sell, issue, or renew individual &#10;44.24   conversion policies to eligible employees otherwise eligible for conversion coverage under &#10;44.25   section 62D.104 as a result of leaving a health maintenance organization's service area.&#10;44.26   (b) A health carrier may sell, issue, or renew individual conversion policies to &#10;44.27   eligible employees otherwise eligible for conversion coverage as a result of the expiration &#10;44.28   of any continuation of group coverage required under sections 62A.146, 62A.17, 62A.21, &#10;44.29   62C.142, 62D.101, and 62D.105.&#10;44.30   (c) A health carrier may sell, issue, or renew conversion policies under section &#10;44.31   62E.16 to eligible employees.&#10;44.32   (d) A health carrier may sell, issue, or renew individual continuation policies to &#10;44.33   eligible employees as required.&#10;44.34   (e) A health carrier may sell, issue, or renew individual health plans if the coverage &#10;44.35   is appropriate due to an unexpired preexisting condition limitation or exclusion applicable &#10;45.1    to the person under the employer's group health plan or due to the person's need for health &#10;45.2    care services not covered under the employer's group health plan.&#10;45.3    (f) A health carrier may sell, issue, or renew an individual health plan, if the &#10;45.4    individual has elected to buy the individual health plan not as part of a general plan to &#10;45.5    substitute individual health plans for a group health plan nor as a result of any violation of &#10;45.6    subdivision 3 or 4.&#10;45.7    (g) Nothing in this subdivision relieves a health carrier of any obligation to provide &#10;45.8    continuation or conversion coverage otherwise required under federal or state law.&#10;45.9    (h) Nothing in this chapter restricts the offer, sale, issuance, or renewal of coverage &#10;45.10   issued as a supplement to Medicare under sections 62A.31 to 62A.44, or policies or &#10;45.11   contracts that supplement Medicare issued by health maintenance organizations, or those &#10;45.12   contracts governed by sections 1833, 1851 to 1859, 1860D, or 1876 of the federal Social &#10;45.13   Security Act, United States Code, title 42, section 1395 et seq., as amended.&#10;45.14   (i) Nothing in this chapter restricts the offer, sale, issuance, or renewal of individual &#10;45.15   health plans necessary to comply with a court order.&#10;45.16   (j) A health carrier may offer, issue, sell, or renew an individual health plan to &#10;45.17   persons eligible for an employer group health plan, if the individual health plan is a high &#10;45.18   deductible health plan for use in connection with an existing health savings account, in &#10;45.19   compliance with the Internal Revenue Code, section 223. In that situation, the same or &#10;45.20   a different health carrier may offer, issue, sell, or renew a group health plan to cover &#10;45.21   the other eligible employees in the group.&#10;45.22   <ins>(k) A health carrier may offer, sell, issue, or renew an individual health plan to one </ins>&#10;45.23   <ins>or more employees of a small employer if the individual health plan is marketed directly to </ins>&#10;45.24   <ins>all employees of the small employer and the small employer does not contribute directly </ins>&#10;45.25   <ins>or indirectly to the premiums or facilitate the administration of the individual health plan. </ins>&#10;45.26   <ins>The requirement to market an individual health plan to all employees does not require the </ins>&#10;45.27   <ins>health carrier to offer or issue an individual health plan to any employee. For purposes </ins>&#10;45.28   <ins>of this paragraph, an employer is not contributing to the premiums or facilitating the </ins>&#10;45.29   <ins>administration of the individual health plan if the employer does not contribute to the </ins>&#10;45.30   <ins>premium and merely collects the premiums from an employee's wages or salary through </ins>&#10;45.31   <ins>payroll deductions and submits payment for the premiums of one or more employees in a </ins>&#10;45.32   <ins>lump sum to the health carrier. Except for coverage under section 62A.65, subdivision 5, </ins>&#10;45.33   <ins>paragraph (b), or 62E.16, at the request of an employee, the health carrier may bill the </ins>&#10;45.34   <ins>employer for the premiums payable by the employee, provided that the employer is not </ins>&#10;45.35   <ins>liable for payment except from payroll deductions for that purpose. If an employer is </ins>&#10;45.36   <ins>submitting payments under this paragraph, the health carrier shall provide a cancellation </ins>&#10;46.1    <ins>notice directly to the primary insured at least ten days prior to termination of coverage for </ins>&#10;46.2    <ins>nonpayment of premium. Individual coverage under this paragraph may be offered only </ins>&#10;46.3    <ins>if the small employer has not provided coverage under section 62L.03 to the employees </ins>&#10;46.4    <ins>within the past 12 months.</ins>&#10;46.5    <ins>The employer must provide a written and signed statement to the health carrier that </ins>&#10;46.6    <ins>the employer is not contributing directly or indirectly to the employee's premiums. The </ins>&#10;46.7    <ins>health carrier may rely on the employer's statement and is not required to guarantee-issue </ins>&#10;46.8    <ins>individual health plans to the employer's other current or future employees.</ins>&#10;46.9    <ins><b>EFFECTIVE DATE.</b></ins><ins>This section is effective the day following final enactment.</ins>&#10;&#10;<a id="go.0.31.0"></a>46.10       Sec. 31. Minnesota Statutes 2004, section 62M.01, subdivision 2, is amended to read:&#10;46.11       Subd. 2. <b>Jurisdiction.</b> Sections  62M.01 to  62M.16 apply to any insurance company &#10;46.12   licensed under chapter 60A to offer, sell, or issue a policy of accident and sickness &#10;46.13   insurance as defined in section  62A.01; a health service plan licensed under chapter &#10;46.14   62C; a health maintenance organization licensed under chapter 62D; <ins>the Minnesota </ins>&#10;46.15   <ins>Comprehensive Health Association created under chapter 62E; </ins>a community integrated &#10;46.16   service network licensed under chapter 62N; an accountable provider network operating &#10;46.17   under chapter 62T; a fraternal benefit society operating under chapter 64B; a joint &#10;46.18   self-insurance employee health plan operating under chapter 62H; a multiple employer &#10;46.19   welfare arrangement, as defined in section 3 of the Employee Retirement Income Security &#10;46.20   Act of 1974 (ERISA), United States Code, title 29, section 1103, as amended; a third &#10;46.21   party administrator licensed under section  60A.23, subdivision 8, that provides utilization &#10;46.22   review services for the administration of benefits under a health benefit plan as defined in &#10;46.23   section  62M.02; or any entity performing utilization review on behalf of a business entity &#10;46.24   in this state pursuant to a health benefit plan covering a Minnesota resident. &#10;&#10;<a id="go.0.32.0"></a>46.25       Sec. 32. <ins><b>[62M.072] USE OF EVIDENCE-BASED STANDARDS.</b></ins>&#10;46.26   <ins>If no independently developed evidence-based standards exist for a particular </ins>&#10;46.27   <ins>treatment, testing, or imaging procedure, then an insurer or utilization review organization </ins>&#10;46.28   <ins>shall not deny coverage of the treatment, testing, or imaging based solely on the grounds </ins>&#10;46.29   <ins>that the treatment, testing, or imaging does not meet an evidence-based standard. This </ins>&#10;46.30   <ins>section does not prohibit an insurer or utilization review organization from denying </ins>&#10;46.31   <ins>coverage for services that are investigational, experimental, or not medically necessary.</ins>&#10;&#10;<a id="go.0.33.0"></a>46.32       Sec. 33. Minnesota Statutes 2004, section 62M.09, subdivision 9, is amended to read:&#10;47.1        Subd. 9. <b>Annual report.</b> A utilization review organization shall file an annual &#10;47.2    report with the annual financial statement it submits to the commissioner of commerce &#10;47.3    that includes:&#10;47.4    (1) per 1,000 <del>claims</del><ins> utilization reviews</ins>, the number and rate of <del>claims denied</del> &#10;47.5    <ins>determinations not to certify </ins>based on medical necessity for each procedure or service; and&#10;47.6    (2) the number and rate of denials overturned on appeal.&#10;47.7    <ins>A utilization review organization that is not a licensed health carrier must submit the </ins>&#10;47.8    <ins>annual report required by this subdivision on April 1 of each year.</ins>&#10;&#10;<a id="go.0.34.0"></a>47.9        Sec. 34. <ins><b>[62Q.645] DISTRIBUTION OF INFORMATION; ADMINISTRATIVE </b></ins>&#10;47.10   <ins><b>EFFICIENCY AND COVERAGE OPTIONS.</b></ins>&#10;47.11   <ins>(a) The commissioner may use reports submitted by health  plan companies, service </ins>&#10;47.12   <ins>cooperatives, and the public employee  insurance program created in section 43A.316 </ins>&#10;47.13   <ins>to compile entity specific administrative efficiency reports; may make these reports </ins>&#10;47.14   <ins>available on state agency Web sites,  including minnesotahealthinfo.com; and may include </ins>&#10;47.15   <ins>information  on: </ins>&#10;47.16   <ins>(1) number of covered lives;  </ins>&#10;47.17   <ins>(2) covered services;  </ins>&#10;47.18   <ins>(3) geographic availability;  </ins>&#10;47.19   <ins>(4) whom to contact to obtain current premium rates;  </ins>&#10;47.20   <ins>(5) administrative costs, using the definition of  administrative costs developed under </ins>&#10;47.21   <ins>section 62J.38;  </ins>&#10;47.22   <ins>(6) Internet links to information on the health plan, if  available; and  </ins>&#10;47.23   <ins>(7) any other information about the health plan identified  by the commissioner </ins>&#10;47.24   <ins>as being useful for employers, consumers,  providers, and others in evaluating health </ins>&#10;47.25   <ins>plan options. </ins>&#10;47.26   <ins>(b) This section does not apply to a health plan company  unless its annual Minnesota </ins>&#10;47.27   <ins>premiums exceed $50,000,000 based on the most recent assessment base of the Minnesota </ins>&#10;47.28   <ins>Comprehensive Health Association. For purposes of this  determination, the premiums of a </ins>&#10;47.29   <ins>health plan company include  those of its affiliates.</ins>&#10;&#10;<a id="go.0.35.0"></a>47.30       Sec. 35. <ins><b>[62Q.80] COMMUNITY-BASED HEALTH CARE COVERAGE </b></ins>&#10;47.31   <ins><b>PROGRAM.</b></ins>&#10;47.32       <ins>Subdivision 1.</ins> <ins><b>Scope.</b></ins> <ins>(a) A community-based health care initiative may develop and </ins>&#10;47.33   <ins>operate a community-based health care coverage program that offers to eligible individuals </ins>&#10;47.34   <ins>and their dependents the option of purchasing through their employer health care coverage </ins>&#10;48.1    <ins>on a fixed prepaid basis without meeting the requirements of chapter 60A, 62A, 62C, 62D, </ins>&#10;48.2    <ins>62Q, or 62T, or any other law or rule that applies to entities licensed under these chapters.</ins>&#10;48.3    <ins>(b) The initiative shall establish health outcomes to be achieved through the program </ins>&#10;48.4    <ins>and performance measurements in order to determine whether these outcomes have been </ins>&#10;48.5    <ins>met. The outcomes must include, but are not limited to:</ins>&#10;48.6    <ins>(1) a reduction in uncompensated care provided by providers participating in the </ins>&#10;48.7    <ins>community-based health network; </ins>&#10;48.8    <ins>(2) an increase in the delivery of preventive health care services; and</ins>&#10;48.9    <ins>(3) health improvement for enrollees with chronic health conditions through the </ins>&#10;48.10   <ins>management of these conditions.</ins>&#10;48.11   <ins>In establishing performance measurements, the initiative shall use measures that are </ins>&#10;48.12   <ins>consistent with measures published by nonprofit Minnesota or national organizations that </ins>&#10;48.13   <ins>produce and disseminate health care quality measures.</ins>&#10;48.14   <ins>(c) Any program established under this section shall not constitute a financial </ins>&#10;48.15   <ins>liability for the state, in that any financial risk involved in the operation or termination </ins>&#10;48.16   <ins>of the program shall be borne by the community-based initiative and the participating </ins>&#10;48.17   <ins>health care providers.</ins>&#10;48.18       <ins>Subd. 2.</ins> <ins><b>Definitions. </b></ins> <ins>For purposes of this section, the following definitions apply: </ins>&#10;48.19   <ins>(a) "Community-based" means located in or primarily relating to the community </ins>&#10;48.20   <ins>of geographically contiguous political subdivisions, as determined by the board of a </ins>&#10;48.21   <ins>community-based health initiative that is served by the community-based health care </ins>&#10;48.22   <ins>coverage program. </ins>&#10;48.23   <ins>(b) "Community-based health care coverage program" or "program" means a </ins>&#10;48.24   <ins>program administered by a community-based health initiative that provides health care </ins>&#10;48.25   <ins>services through provider members of a community-based health network or combination </ins>&#10;48.26   <ins>of networks to eligible individuals and their dependents who are enrolled in the program. </ins>&#10;48.27   <ins>(c) "Community-based health initiative" means a nonprofit corporation that is </ins>&#10;48.28   <ins>governed by a board that has at least 80 percent of its members residing in the community </ins>&#10;48.29   <ins>and includes representatives of the participating network providers and employers. </ins>&#10;48.30   <ins>(d) "Community-based health network" means a contract-based network of health </ins>&#10;48.31   <ins>care providers organized by the community-based health initiative to provide or support </ins>&#10;48.32   <ins>the delivery of health care services to enrollees of the community-based health care </ins>&#10;48.33   <ins>coverage program on a risk-sharing or nonrisk-sharing basis. </ins>&#10;48.34   <ins>(e) "Dependent" means an eligible employee's spouse or unmarried child who is </ins>&#10;48.35   <ins>under the age of 19 years. </ins>&#10;49.1        <ins>Subd. 3.</ins> <ins><b>Approval. </b></ins> <ins>(a) Prior to the operation of a community-based health care </ins>&#10;49.2    <ins>coverage program, a community-based health initiative shall submit to the commissioner </ins>&#10;49.3    <ins>of health for approval the community-based health care coverage program developed by </ins>&#10;49.4    <ins>the initiative. The commissioner shall only approve a program that has been awarded </ins>&#10;49.5    <ins>a community access program grant from the United States Department of Health and </ins>&#10;49.6    <ins>Human Services. The commissioner shall ensure that the program meets the federal grant </ins>&#10;49.7    <ins>requirements and any requirements described in this section and is actuarially sound based </ins>&#10;49.8    <ins>on a review of appropriate records and methods utilized by the community-based health </ins>&#10;49.9    <ins>initiative in establishing premium rates for the community-based health care coverage </ins>&#10;49.10   <ins>program. </ins>&#10;49.11   <ins>(b) Prior to approval, the commissioner shall also ensure that:</ins>&#10;49.12   <ins>(1) the benefits offered comply with subdivision 8 and that there are adequate </ins>&#10;49.13   <ins>numbers of health care providers participating in the community-based health network to </ins>&#10;49.14   <ins>deliver the benefits offered under the program;</ins>&#10;49.15   <ins>(2) the activities of the program are limited to activities that are exempt under this </ins>&#10;49.16   <ins>section or otherwise from regulation by the commissioner of commerce;</ins>&#10;49.17   <ins>(3) the complaint resolution process meets the requirements of subdivision 10; and </ins>&#10;49.18   <ins>(4) the data privacy policies and procedures comply with state and federal law.</ins>&#10;49.19       <ins>Subd. 4.</ins> <ins><b>Establishment. </b></ins> <ins>(a) The initiative shall establish and operate upon approval </ins>&#10;49.20   <ins>by the commissioner of health a community-based health care coverage program. The </ins>&#10;49.21   <ins>operational structure established by the initiative shall include, but is not limited to: </ins>&#10;49.22   <ins>(1) establishing a process for enrolling eligible individuals and their dependents; </ins>&#10;49.23   <ins>(2) collecting and coordinating premiums from enrollees and employers of enrollees;</ins>&#10;49.24   <ins>(3) providing payment to participating providers; </ins>&#10;49.25   <ins>(4) establishing a benefit set according to subdivision 8 and establishing premium </ins>&#10;49.26   <ins>rates and cost-sharing requirements; </ins>&#10;49.27   <ins>(5) creating incentives to encourage primary care and wellness services; and </ins>&#10;49.28   <ins>(6) initiating disease management services, as appropriate. </ins>&#10;49.29   <ins>(b) The payments collected under paragraph (a), clause (2), may be used to capture </ins>&#10;49.30   <ins>available federal funds.</ins>&#10;49.31       <ins>Subd. 5.</ins> <ins><b>Qualifying employees. </b></ins> <ins>To be eligible for the community-based health </ins>&#10;49.32   <ins>care coverage program, an individual must: </ins>&#10;49.33   <ins>(1) reside in or work within the designated community-based geographic area </ins>&#10;49.34   <ins>served by the program; </ins>&#10;49.35   <ins>(2) be employed by a qualifying employer or be an employee's dependent; </ins>&#10;49.36   <ins>(3) not be enrolled in or have currently available health coverage; and </ins>&#10;50.1    <ins>(4) not be enrolled in medical assistance, general assistance medical care, </ins>&#10;50.2    <ins>MinnesotaCare, or Medicare.</ins>&#10;50.3        <ins>Subd. 6.</ins> <ins><b>Qualifying employers. </b></ins> <ins>(a) To qualify for participation in the </ins>&#10;50.4    <ins>community-based health care coverage program, an employer must: </ins>&#10;50.5    <ins>(1) employ at least one but no more than 50 employees at the time of initial </ins>&#10;50.6    <ins>enrollment in the program; </ins>&#10;50.7    <ins>(2) pay its employees a median wage of $12.50 per hour or less; and </ins>&#10;50.8    <ins>(3) not have offered employer-subsidized health coverage to its employees for </ins>&#10;50.9    <ins>at least 12 months prior to the initial enrollment in the program. For purposes of this </ins>&#10;50.10   <ins>section, "employer-subsidized health coverage" means health care coverage for which the </ins>&#10;50.11   <ins>employer pays at least 50 percent of the cost of coverage for the employee.</ins>&#10;50.12   <ins>(b) To participate in the program, a qualifying employer agrees to: </ins>&#10;50.13   <ins>(1) offer health care coverage through the program to all eligible employees and </ins>&#10;50.14   <ins>their dependents regardless of health status; </ins>&#10;50.15   <ins>(2) participate in the program for an initial term of at least one year; </ins>&#10;50.16   <ins>(3) pay a percentage of the premium established by the initiative for the employee; </ins>&#10;50.17   <ins>and </ins>&#10;50.18   <ins>(4) provide the initiative with any employee information deemed necessary by the </ins>&#10;50.19   <ins>initiative to determine eligibility and premium payments. </ins>&#10;50.20       <ins>Subd. 7.</ins> <ins><b>Participating providers.</b></ins> <ins>Any health care provider participating in the </ins>&#10;50.21   <ins>community-based health network must accept as payment in full the payment rate </ins>&#10;50.22   <ins>established by the initiative and may not charge to or collect from an enrollee any amount </ins>&#10;50.23   <ins>in access of this amount for any service covered under the program.</ins>&#10;50.24       <ins>Subd. 8.</ins> <ins><b>Coverage. </b></ins> <ins>(a) The initiative shall establish the health care benefits offered </ins>&#10;50.25   <ins>through the community-based health care coverage program. The benefits established </ins>&#10;50.26   <ins>shall include, at a minimum: </ins>&#10;50.27   <ins>(1) child health supervision services up to age 18, as defined under section 62A.047; </ins>&#10;50.28   <ins>and </ins>&#10;50.29   <ins>(2) preventive services, including: </ins>&#10;50.30   <ins>(i) health education and wellness services; </ins>&#10;50.31   <ins>(ii) health supervision, evaluation, and follow-up; </ins>&#10;50.32   <ins>(iii) immunizations; and </ins>&#10;50.33   <ins>(iv) early disease detection. </ins>&#10;50.34   <ins>(b) Coverage of health care services offered by the program may be limited to </ins>&#10;50.35   <ins>participating health care providers or health networks. All services covered under the </ins>&#10;51.1    <ins>program must be services that are offered within the scope of practice of the participating </ins>&#10;51.2    <ins>health care providers. </ins>&#10;51.3    <ins>(c) The initiative may establish cost-sharing requirements. Any co-payment or </ins>&#10;51.4    <ins>deductible provisions established may not discriminate on the basis of age, sex, race, </ins>&#10;51.5    <ins>disability, economic status, or length of enrollment in the program. </ins>&#10;51.6    <ins>(d) If the initiative amends or alters the benefits offered through the program from </ins>&#10;51.7    <ins>the initial offering, the initiative must notify the commissioner of health and all enrollees </ins>&#10;51.8    <ins>of the benefit change.</ins>&#10;51.9        <ins>Subd. 9.</ins> <ins><b>Enrollee information.</b></ins> <ins>(a) The initiative must provide an individual or </ins>&#10;51.10   <ins>family who enrolls in the program a clear and concise written statement that includes </ins>&#10;51.11   <ins>the following information: </ins>&#10;51.12   <ins>(1) health care services that are provided under the program; </ins>&#10;51.13   <ins>(2) any exclusions or limitations on the health care services offered, including any </ins>&#10;51.14   <ins>cost-sharing arrangements or prior authorization requirements; </ins>&#10;51.15   <ins>(3) a list of where the health care services can be obtained and that all health </ins>&#10;51.16   <ins>care services must be provided by or through a participating health care provider or </ins>&#10;51.17   <ins>community-based health network; </ins>&#10;51.18   <ins>(4) a description of the program's complaint resolution process, including how to </ins>&#10;51.19   <ins>submit a complaint; how to file a complaint with the commissioner of health; and how to </ins>&#10;51.20   <ins>obtain an external review of any adverse decisions as provided under subdivision 10; </ins>&#10;51.21   <ins>(5) the conditions under which the program or coverage under the program may </ins>&#10;51.22   <ins>be canceled or terminated; and </ins>&#10;51.23   <ins>(6) a precise statement specifying that this program is not an insurance product and, </ins>&#10;51.24   <ins>as such, is exempt from state regulation of insurance products.</ins>&#10;51.25   <ins>(b) The commissioner of health must approve a copy of the written statement prior </ins>&#10;51.26   <ins>to the operation of the program. </ins>&#10;51.27       <ins>Subd. 10.</ins> <ins><b>Complaint resolution process.</b></ins> <ins>(a) The initiative must establish a </ins>&#10;51.28   <ins>complaint resolution process. The process must make reasonable efforts to resolve </ins>&#10;51.29   <ins>complaints and to inform complainants in writing of the initiative's decision within 60 </ins>&#10;51.30   <ins>days of receiving the complaint. Any decision that is adverse to the enrollee shall include </ins>&#10;51.31   <ins>a description of the right to an external review as provided in paragraph (c) and how to </ins>&#10;51.32   <ins>exercise this right.</ins>&#10;51.33   <ins>(b) The initiative must report any complaint that is not resolved within 60 days to the </ins>&#10;51.34   <ins>commissioner of health. </ins>&#10;52.1    <ins>(c) The initiative must include in the complaint resolution process the ability of an </ins>&#10;52.2    <ins>enrollee to pursue the external review process provided under section 62Q.73 with any </ins>&#10;52.3    <ins>decision rendered under this external review process binding on the initiative.</ins>&#10;52.4        <ins>Subd. 11.</ins> <ins><b>Data privacy.</b></ins> <ins>The initiative shall establish data privacy policies and </ins>&#10;52.5    <ins>procedures for the program that comply with state and federal data privacy laws. </ins>&#10;52.6        <ins>Subd. 12.</ins> <ins><b>Limitations on enrollment.</b></ins> <ins>(a) The initiative may limit enrollment in the </ins>&#10;52.7    <ins>program. If enrollment is limited, a waiting list must be established. </ins>&#10;52.8    <ins>(b) The initiative shall not restrict or deny enrollment in the program except for </ins>&#10;52.9    <ins>nonpayment of premiums, fraud or misrepresentation, or as otherwise permitted under </ins>&#10;52.10   <ins>this section. </ins>&#10;52.11   <ins>(c) The initiative may require a certain percentage of participation from eligible </ins>&#10;52.12   <ins>employees of a qualifying employer before coverage can be offered through the program. </ins>&#10;52.13       <ins>Subd. 13.</ins> <ins><b>Report. </b></ins> <ins>(a) The initiative shall submit quarterly status reports to the </ins>&#10;52.14   <ins>commissioner of health on January 15, April 15, July 15, and October 15 of each year, </ins>&#10;52.15   <ins>with the first report due January 15, 2007. The status report shall include:</ins>&#10;52.16   <ins>(1) the financial status of the program, including the premium rates, cost per member </ins>&#10;52.17   <ins>per month, claims paid out, premiums received, and administrative expenses; </ins>&#10;52.18   <ins>(2) a description of the health care benefits offered and the services utilized; </ins>&#10;52.19   <ins>(3) the number of employers participating, the number of employees and dependents </ins>&#10;52.20   <ins>covered under the program, and the number of health care providers participating; </ins>&#10;52.21   <ins>(4) a description of the health outcomes to be achieved by the program and a status </ins>&#10;52.22   <ins>report on the performance measurements to be used and collected; and </ins>&#10;52.23   <ins>(5) any other information requested by the commissioner of health or commerce or </ins>&#10;52.24   <ins>the legislature. </ins>&#10;52.25   <ins>(b) The initiative shall contract with an independent entity to conduct an evaluation </ins>&#10;52.26   <ins>of the program to be submitted to the commissioners of health and commerce and the </ins>&#10;52.27   <ins>legislature by January 15, 2009. The evaluation shall include:</ins>&#10;52.28   <ins>(1) an analysis of the health outcomes established by the initiative and the </ins>&#10;52.29   <ins>performance measurements to determine whether the outcomes are being achieved;</ins>&#10;52.30   <ins>(2) an analysis of the financial status of the program, including the claims to </ins>&#10;52.31   <ins>premiums loss ratio and utilization and cost experience; </ins>&#10;52.32   <ins>(3) the demographics of the enrollees, including their age, gender, family income, </ins>&#10;52.33   <ins>and the number of dependents; </ins>&#10;52.34   <ins>(4) the number of employers and employees who have been denied access to the </ins>&#10;52.35   <ins>program and the basis for the denial; </ins>&#10;53.1    <ins>(5) specific analysis on enrollees who have aggregate medical claims totaling over </ins>&#10;53.2    <ins>$5,000 per year, including data on the enrollee's main diagnosis and whether all the </ins>&#10;53.3    <ins>medical claims were covered by the program; </ins>&#10;53.4    <ins>(6) number of enrollees referred to state public assistance programs; </ins>&#10;53.5    <ins>(7) a comparison of employer-subsidized health coverage provided in a comparable </ins>&#10;53.6    <ins>geographic area to the designated community-based geographic area served by the </ins>&#10;53.7    <ins>program, including, to the extent available: </ins>&#10;53.8    <ins>(i) the difference in the number of employers with 50 or fewer employees offering </ins>&#10;53.9    <ins>employer-subsidized health coverage; </ins>&#10;53.10   <ins>(ii) the difference in uncompensated care being provided in each area; and</ins>&#10;53.11   <ins>(iii) a comparison of health care outcomes and measurements established by the </ins>&#10;53.12   <ins>initiative; and </ins>&#10;53.13   <ins>(8) any other information requested by the commissioner of health or commerce.</ins>&#10;53.14       <ins>Subd. 14.</ins> <ins><b>Sunset.</b></ins> <ins>This section expires December 31, 2011.</ins>&#10;&#10;<a id="go.0.36.0"></a>53.15       Sec. 36. Minnesota Statutes 2004, section 62S.05, is amended by adding a subdivision &#10;53.16   to read:&#10;53.17       <ins>Subd. 4.</ins> <ins><b>Extension of limitation periods.</b></ins> <ins>The commissioner may extend the </ins>&#10;53.18   <ins>limitation periods set forth in subdivisions 1 and 2 as to specific age group categories in </ins>&#10;53.19   <ins>specific policy forms upon finding that the extension is in the best interest of the public.</ins>&#10;53.20   <ins><b>EFFECTIVE DATE.</b></ins><ins>This section is effective July 1, 2006.</ins>&#10;&#10;<a id="go.0.37.0"></a>53.21       Sec. 37. Minnesota Statutes 2004, section 62S.08, subdivision 3, is amended to read:&#10;53.22       Subd. 3. <b>Mandatory format.</b> The following standard format outline of coverage &#10;53.23   must be used, unless otherwise specifically indicated:&#10;53.24   COMPANY NAME&#10;53.25   ADDRESS - CITY AND STATE&#10;53.26   TELEPHONE NUMBER&#10;53.27   LONG-TERM CARE INSURANCE&#10;53.28   OUTLINE OF COVERAGE&#10;53.29   Policy Number or Group Master Policy and Certificate Number&#10;53.30   (Except for policies or certificates which are guaranteed issue, the following caution &#10;53.31   statement, or language substantially similar, must appear as follows in the outline of &#10;53.32   coverage.)&#10;53.33   CAUTION: The issuance of this long-term care insurance (policy) (certificate) &#10;53.34   is based upon your responses to the questions on your application. A copy of your &#10;53.35   (application) (enrollment form) (is enclosed) (was retained by you when you applied). &#10;54.1    If your answers are incorrect or untrue, the company has the right to deny benefits or &#10;54.2    rescind your policy. The best time to clear up any questions is now, before a claim &#10;54.3    arises. If, for any reason, any of your answers are incorrect, contact the company at this &#10;54.4    address: (insert address).&#10;54.5    (1) This policy is (an individual policy of insurance) (a group policy) which was &#10;54.6    issued in the (indicate jurisdiction in which group policy was issued).&#10;54.7    (2) PURPOSE OF OUTLINE OF COVERAGE. This outline of coverage provides &#10;54.8    a very brief description of the important features of the policy. You should compare &#10;54.9    this outline of coverage to outlines of coverage for other policies available to you. This &#10;54.10   is not an insurance contract, but only a summary of coverage. Only the individual or &#10;54.11   group policy contains governing contractual provisions. This means that the policy or &#10;54.12   group policy sets forth in detail the rights and obligations of both you and the insurance &#10;54.13   company. Therefore, if you purchase this coverage, or any other coverage, it is important &#10;54.14   that you READ YOUR POLICY (OR CERTIFICATE) CAREFULLY.&#10;54.15   (3) THIS PLAN IS INTENDED TO BE A QUALIFIED LONG-TERM CARE &#10;54.16   INSURANCE CONTRACT AS DEFINED UNDER SECTION 7702(B)(b) OF THE &#10;54.17   INTERNAL REVENUE CODE OF 1986.&#10;54.18   (4) <ins>TERMS UNDER WHICH THE POLICY OR CERTIFICATE MAY BE </ins>&#10;54.19   <ins>CONTINUED IN FORCE OR DISCONTINUED.</ins>&#10;54.20   <ins>(a) (For long-term care health insurance policies or certificates describe one of the </ins>&#10;54.21   <ins>following permissible policy renewability provisions:)</ins>&#10;54.22   <ins>(1) (Policies and certificates that are guaranteed renewable shall contain the </ins>&#10;54.23   <ins>following statement:) RENEWABILITY: THIS POLICY (CERTIFICATE) IS </ins>&#10;54.24   <ins>GUARANTEED RENEWABLE. This means you have the right, subject to the terms of </ins>&#10;54.25   <ins>your policy, (certificate) to continue this policy as long as you pay your premiums on time. </ins>&#10;54.26   <ins>(Company name) cannot change any of the terms of your policy on its own, except that, in </ins>&#10;54.27   <ins>the future, IT MAY INCREASE THE PREMIUM YOU PAY.</ins>&#10;54.28   <ins>(2) (Policies and certificates that are noncancelable shall contain the following </ins>&#10;54.29   <ins>statement:) RENEWABILITY: THIS POLICY (CERTIFICATE) IS NONCANCELABLE. </ins>&#10;54.30   <ins>This means that you have the right, subject to the terms of your policy, to continue this </ins>&#10;54.31   <ins>policy as long as you pay your premiums on time. (Company name) cannot change any </ins>&#10;54.32   <ins>of the terms of your policy on its own and cannot change the premium you currently </ins>&#10;54.33   <ins>pay. However, if your policy contains an inflation protection feature where you choose </ins>&#10;54.34   <ins>to increase your benefits, (company name) may increase your premium at that time for </ins>&#10;54.35   <ins>those additional benefits.</ins>&#10;55.1    <ins>(b) (For group coverage, specifically describe continuation/conversion provisions </ins>&#10;55.2    <ins>applicable to the certificate and group policy.)</ins>&#10;55.3    <ins>(c) (Describe waiver of premium provisions or state that there are not such </ins>&#10;55.4    <ins>provisions.)</ins>&#10;55.5    <ins>(5) TERMS UNDER WHICH THE COMPANY MAY CHANGE PREMIUMS. </ins>&#10;55.6    <ins>(In bold type larger than the maximum type required to be used for the other </ins>&#10;55.7    <ins>provisions of the outline of coverage, state whether or not the company has a right to </ins>&#10;55.8    <ins>change the premium and, if a right exists, describe clearly and concisely each circumstance </ins>&#10;55.9    <ins>under which the premium may change.)</ins>&#10;55.10   <ins>(6) </ins>TERMS UNDER WHICH THE POLICY OR CERTIFICATE MAY BE &#10;55.11   RETURNED AND PREMIUM REFUNDED.&#10;55.12   (a) (Provide a brief description of the right to return -- "free look" provision of &#10;55.13   the policy.)&#10;55.14   (b) (Include a statement that the policy either does or does not contain provisions &#10;55.15   providing for a refund or partial refund of premium upon the death of an insured or &#10;55.16   surrender of the policy or certificate. If the policy contains such provisions, include a &#10;55.17   description of them.)&#10;55.18   <del>(5)</del> <ins>(7) </ins>THIS IS NOT MEDICARE SUPPLEMENT COVERAGE. If you are &#10;55.19   eligible for Medicare, review the Medicare Supplement Buyer's Guide available from &#10;55.20   the insurance company.&#10;55.21   (a) (For agents) neither (insert company name) nor its agents represent Medicare, the &#10;55.22   federal government, or any state government.&#10;55.23   (b) (For direct response) (insert company name) is not representing Medicare, the &#10;55.24   federal government, or any state government.&#10;55.25   <del>(6)</del> <ins>(8) </ins>LONG-TERM CARE COVERAGE. Policies of this category are designed to &#10;55.26   provide coverage for one or more necessary or medically necessary diagnostic, preventive, &#10;55.27   therapeutic, rehabilitative, maintenance, or personal care services, provided in a setting &#10;55.28   other than an acute care unit of a hospital, such as in a nursing home, in the community, &#10;55.29   or in the home.&#10;55.30   This policy provides coverage in the form of a fixed dollar indemnity benefit for &#10;55.31   covered long-term care expenses, subject to policy (limitations), (waiting periods), and &#10;55.32   (coinsurance) requirements. (Modify this paragraph if the policy is not an indemnity &#10;55.33   policy.)&#10;55.34   <del>(7)</del> <ins>(9) </ins>BENEFITS PROVIDED BY THIS POLICY.&#10;55.35   (a) (Covered services, related deductible(s), waiting periods, elimination periods, &#10;55.36   and benefit maximums.)&#10;56.1    (b) (Institutional benefits, by skill level.)&#10;56.2    (c) (Noninstitutional benefits, by skill level.)&#10;56.3    <ins>(d) (Eligibility for payment of benefits.)</ins>&#10;56.4    <ins>(Activities of daily living and cognitive impairment shall be used to measure an </ins>&#10;56.5    <ins>insured's need for long-term care and must be defined and described as part of the outline </ins>&#10;56.6    <ins>of coverage.)</ins>&#10;56.7    (Any benefit screens must be explained in this section. If these screens differ for &#10;56.8    different benefits, explanation of the screen should accompany each benefit description. If &#10;56.9    an attending physician or other specified person must certify a certain level of functional &#10;56.10   dependency in order to be eligible for benefits, this too must be specified. If activities of &#10;56.11   daily living (ADLs) are used to measure an insured's need for long-term care, then these &#10;56.12   qualifying criteria or screens must be explained.)&#10;56.13   <del>(8)</del> <ins>(10) </ins>LIMITATIONS AND EXCLUSIONS:&#10;56.14   Describe:&#10;56.15   (a) preexisting conditions;&#10;56.16   (b) noneligible facilities/provider;&#10;56.17   (c) noneligible levels of care (e.g., unlicensed providers, care or treatment provided &#10;56.18   by a family member, etc.);&#10;56.19   (d) exclusions/exceptions; and&#10;56.20   (e) limitations.&#10;56.21   (This section should provide a brief specific description of any policy provisions &#10;56.22   which limit, exclude, restrict, reduce, delay, or in any other manner operate to qualify &#10;56.23   payment of the benefits described in paragraph <del>(6)</del><ins> (8)</ins>.)&#10;56.24   THIS POLICY MAY NOT COVER ALL THE EXPENSES ASSOCIATED WITH &#10;56.25   YOUR LONG-TERM CARE NEEDS.&#10;56.26   <del>(9)</del> <ins>(11) </ins>RELATIONSHIP OF COST OF CARE AND BENEFITS. Because the costs &#10;56.27   of long-term care services will likely increase over time, you should consider whether and &#10;56.28   how the benefits of this plan may be adjusted. As applicable, indicate the following:&#10;56.29   (a) that the benefit level will not increase over time;&#10;56.30   (b) any automatic benefit adjustment provisions;&#10;56.31   (c) whether the insured will be guaranteed the option to buy additional benefits and &#10;56.32   the basis upon which benefits will be increased over time if not by a specified amount &#10;56.33   or percentage;&#10;56.34   (d) if there is such a guarantee, include whether additional underwriting or health &#10;56.35   screening will be required, the frequency and amounts of the upgrade options, and any &#10;56.36   significant restrictions or limitations; and&#10;57.1    (e) whether there will be any additional premium charge imposed and how that &#10;57.2    is to be calculated.&#10;57.3    <del>(10)</del> <ins>(12) </ins>ALZHEIMER'S DISEASE AND OTHER ORGANIC BRAIN &#10;57.4    DISORDERS. (State that the policy provides coverage for insureds clinically diagnosed as &#10;57.5    having Alzheimer's disease or related degenerative and dementing illnesses. Specifically, &#10;57.6    describe each benefit screen or other policy provision which provides preconditions to the &#10;57.7    availability of policy benefits for such an insured.)&#10;57.8    <del>(11)</del> <ins>(13) </ins>PREMIUM.&#10;57.9    (a) State the total annual premium for the policy.&#10;57.10   (b) If the premium varies with an applicant's choice among benefit options, indicate &#10;57.11   the portion of annual premium which corresponds to each benefit option.&#10;57.12   <del>(12)</del> <ins>(14) </ins>ADDITIONAL FEATURES.&#10;57.13   (a) Indicate if medical underwriting is used.&#10;57.14   (b) Describe other important features.&#10;57.15   <ins>(15) CONTACT THE STATE DEPARTMENT OF COMMERCE OR SENIOR </ins>&#10;57.16   <ins>LINKAGE LINE IF YOU HAVE GENERAL QUESTIONS REGARDING LONG-TERM </ins>&#10;57.17   <ins>CARE INSURANCE. CONTACT THE INSURANCE COMPANY IF YOU HAVE </ins>&#10;57.18   <ins>SPECIFIC QUESTIONS REGARDING YOUR LONG-TERM CARE INSURANCE </ins>&#10;57.19   <ins>POLICY OR CERTIFICATE.</ins>&#10;57.20   <ins><b>EFFECTIVE DATE.</b></ins><ins>This section is effective July 1, 2006.</ins>&#10;&#10;<a id="go.0.38.0"></a>57.21       Sec. 38. Minnesota Statutes 2004, section 62S.081, subdivision 4, is amended to read:&#10;57.22       Subd. 4. <b>Forms.</b> An insurer shall use the forms in Appendices B <ins>(Personal </ins>&#10;57.23   <ins>Worksheet) </ins>and F <ins>(Potential Rate Increase Disclosure Form) </ins>of the Long-term Care &#10;57.24   Insurance Model Regulation adopted by the National Association of Insurance &#10;57.25   Commissioners to comply with the requirements of subdivisions 1 and 2.&#10;57.26   <ins><b>EFFECTIVE DATE.</b></ins><ins>This section is effective July 1, 2006.</ins>&#10;&#10;<a id="go.0.39.0"></a>57.27       Sec. 39. Minnesota Statutes 2004, section 62S.10, subdivision 2, is amended to read:&#10;57.28       Subd. 2. <b>Contents.</b> The summary must include the following information:&#10;57.29   (1) an explanation of how the long-term care benefit interacts with other components &#10;57.30   of the policy, including deductions from death benefits;&#10;57.31   (2) an illustration of the amount of benefits, the length of benefits, and the guaranteed &#10;57.32   lifetime benefits, if any, for each covered person; <del>and</del>&#10;57.33   (3) any exclusions, reductions, and limitations on benefits of long-term care<ins>; and</ins>&#10;58.1    <ins>(4) a statement that any long-term care inflation protection option required by section </ins>&#10;58.2    <ins>62S.23 is not available under this policy</ins>. &#10;58.3    <ins><b>EFFECTIVE DATE.</b></ins><ins>This section is effective July 1, 2006.</ins>&#10;&#10;<a id="go.0.40.0"></a>58.4        Sec. 40. Minnesota Statutes 2004, section 62S.13, is amended by adding a subdivision &#10;58.5    to read:&#10;58.6        <ins>Subd. 6.</ins> <ins><b>Death of insured.</b></ins> <ins>In the event of the death of the insured, this section shall </ins>&#10;58.7    <ins>not apply to the remaining death benefit of a life insurance policy that accelerates benefits </ins>&#10;58.8    <ins>for long-term care. In this situation, the remaining death benefits under these policies shall </ins>&#10;58.9    <ins>be governed by section 61A.03, subdivision 1, paragraph (c). In all other situations, this </ins>&#10;58.10   <ins>section shall apply to life insurance policies that accelerate benefits for long-term care.</ins>&#10;58.11   <ins><b>EFFECTIVE DATE.</b></ins><ins>This section is effective July 1, 2006.</ins>&#10;&#10;<a id="go.0.41.0"></a>58.12       Sec. 41. Minnesota Statutes 2004, section 62S.14, subdivision 2, is amended to read:&#10;58.13       Subd. 2. <b>Terms.</b> The terms "guaranteed renewable" and "noncancelable" may not &#10;58.14   be used in an individual long-term care insurance policy without further explanatory &#10;58.15   language that complies with the disclosure requirements of section  62S.20.<ins> The term </ins>&#10;58.16   <ins>"level premium" may only be used when the insurer does not have the right to change </ins>&#10;58.17   <ins>the premium.</ins> &#10;58.18   <ins><b>EFFECTIVE DATE.</b></ins><ins>This section is effective July 1, 2006.</ins>&#10;&#10;<a id="go.0.42.0"></a>58.19       Sec. 42. Minnesota Statutes 2004, section 62S.15, is amended to read:&#10;58.20   <b>62S.15 AUTHORIZED LIMITATIONS AND EXCLUSIONS.</b>&#10;58.21   No policy may be delivered or issued for delivery in this state as long-term care &#10;58.22   insurance if the policy limits or excludes coverage by type of illness, treatment, medical &#10;58.23   condition, or accident, except as follows:&#10;58.24   (1) preexisting conditions or diseases;&#10;58.25   (2) mental or nervous disorders; except that the exclusion or limitation of benefits on &#10;58.26   the basis of Alzheimer's disease is prohibited;&#10;58.27   (3) alcoholism and drug addiction;&#10;58.28   (4) illness, treatment, or medical condition arising out of war or act of war; &#10;58.29   participation in a felony, riot, or insurrection; service in the armed forces or auxiliary &#10;58.30   units; suicide, attempted suicide, or intentionally self-inflicted injury; or non-fare-paying &#10;58.31   aviation; <del>and</del>&#10;59.1    (5) treatment provided in a government facility unless otherwise required by &#10;59.2    law, services for which benefits are available under Medicare or other government &#10;59.3    program except Medicaid, state or federal workers' compensation, employer's liability &#10;59.4    or occupational disease law, motor vehicle no-fault law; services provided by a member &#10;59.5    of the covered person's immediate family; and services for which no charge is normally &#10;59.6    made in the absence of insurance<ins>; and</ins>&#10;59.7    <ins>(6) expenses for services or items available or paid under another long-term care </ins>&#10;59.8    <ins>insurance or health insurance policy</ins>.&#10;59.9    This subdivision does not prohibit exclusions and limitations by type of provider or &#10;59.10   territorial limitations.&#10;59.11   <ins><b>EFFECTIVE DATE.</b></ins><ins>This section is effective July 1, 2006.</ins>&#10;&#10;<a id="go.0.43.0"></a>59.12       Sec. 43. Minnesota Statutes 2004, section 62S.20, subdivision 1, is amended to read:&#10;59.13       Subdivision 1. <b>Renewability.</b> <ins>(a) </ins>Individual long-term care insurance policies &#10;59.14   must contain a renewability provision that is appropriately captioned, appears on the first &#10;59.15   page of the policy, and clearly states <del>the duration, where limited, of renewability and the </del>&#10;59.16   <del>duration of the term of coverage for which the policy is issued and for which it may be </del>&#10;59.17   <del>renewed</del><ins> that the coverage is guaranteed renewable or noncancelable</ins>. This subdivision &#10;59.18   does not apply to policies which are part of or combined with life insurance policies &#10;59.19   which do not contain a renewability provision and under which the right to nonrenew is &#10;59.20   reserved solely to the policyholder.&#10;59.21   <ins>(b) A long-term care insurance policy or certificate, other than one where the insurer </ins>&#10;59.22   <ins>does not have the right to change the premium, shall include a statement that premium </ins>&#10;59.23   <ins>rates may change.</ins>&#10;59.24   <ins><b>EFFECTIVE DATE.</b></ins><ins>This section is effective July 1, 2006.</ins>&#10;&#10;<a id="go.0.44.0"></a>59.25       Sec. 44. Minnesota Statutes 2004, section 62S.24, subdivision 1, is amended to read:&#10;59.26       Subdivision 1. <b>Required questions.</b> An application form must include the following &#10;59.27   questions designed to elicit information as to whether, as of the date of the application, the &#10;59.28   applicant has another long-term care insurance policy or certificate in force or whether a &#10;59.29   long-term care policy or certificate is intended to replace any other <ins>accident and sickness </ins>&#10;59.30   <ins>or </ins>long-term care policy or certificate presently in force. A supplementary application &#10;59.31   or other form to be signed by the applicant and agent, except where the coverage is sold &#10;59.32   without an agent, containing the following questions may be used. If a replacement policy &#10;59.33   is issued to a group as defined under section   62S.01, subdivision 15, clause (1), the &#10;60.1    following questions may be modified only to the extent necessary to elicit information &#10;60.2    about long-term care insurance policies other than the group policy being replaced; &#10;60.3    provided, however, that the certificate holder has been notified of the replacement: &#10;60.4    (1)  do you have another long-term care insurance policy or certificate in force<ins> </ins>&#10;60.5    <ins>(including health care service contract or health maintenance organization contract)</ins>?;&#10;60.6    (2) did you have another long-term care insurance policy or certificate in force &#10;60.7    during the last 12 months?;&#10;60.8    (i) if so, with which company?; and&#10;60.9    (ii) if that policy lapsed, when did it lapse?; <del>and</del>&#10;60.10   (3) are you covered by Medicaid?<ins>; and </ins>&#10;60.11   <ins>(4) do you intend to replace any of your medical or health insurance coverage with </ins>&#10;60.12   <ins>this policy (certificate)?</ins>&#10;60.13   <ins><b>EFFECTIVE DATE.</b></ins><ins>This section is effective July 1, 2006.</ins>&#10;&#10;<a id="go.0.45.0"></a>60.14       Sec. 45. Minnesota Statutes 2004, section 62S.24, is amended by adding a subdivision &#10;60.15   to read:&#10;60.16       <ins>Subd. 1a.</ins> <ins><b>Other health insurance policies sold by agent.</b></ins> <ins>Agents shall list all other </ins>&#10;60.17   <ins>health insurance policies they have sold to the applicant that are still in force or were sold </ins>&#10;60.18   <ins>in the past five years and are no longer in force.</ins>&#10;60.19   <ins><b>EFFECTIVE DATE.</b></ins><ins>This section is effective July 1, 2006.</ins>&#10;&#10;<a id="go.0.46.0"></a>60.20       Sec. 46. Minnesota Statutes 2004, section 62S.24, subdivision 3, is amended to read:&#10;60.21       Subd. 3. <b>Solicitations other than direct response.</b> After determining that a &#10;60.22   sale will involve replacement, an insurer, other than an insurer using direct response &#10;60.23   solicitation methods or its agent, shall furnish the applicant, before issuance or delivery of &#10;60.24   the individual long-term care insurance policy, a notice regarding replacement of accident &#10;60.25   and sickness or long-term care coverage. One copy of the notice must be retained by the &#10;60.26   applicant and an additional copy signed by the applicant must be retained by the insurer. &#10;60.27   The required notice must be provided in the following manner:&#10;60.28   NOTICE TO APPLICANT REGARDING REPLACEMENT OF&#10;60.29   INDIVIDUAL ACCIDENT AND SICKNESS OR LONG-TERM &#10;60.30   CARE INSURANCE&#10;60.31   (Insurance company's name and address)&#10;60.32   SAVE THIS NOTICE! IT MAY BE IMPORTANT TO YOU IN THE FUTURE.&#10;60.33   According to (your application) (information you have furnished), you intend to &#10;60.34   lapse or otherwise terminate existing <ins>accident and sickness or </ins>long-term care insurance &#10;61.1    and replace it with an individual long-term care insurance policy to be issued by (company &#10;61.2    name) insurance company. Your new policy provides 30 days within which you may &#10;61.3    decide, without cost, whether you desire to keep the policy. For your own information and &#10;61.4    protection, you should be aware of and seriously consider certain factors which may affect &#10;61.5    the insurance protection available to you under the new policy.&#10;61.6    You should review this new coverage carefully, comparing it with all <ins>accident </ins>&#10;61.7    <ins>and sickness or </ins>long-term care insurance coverage you now have, and terminate your &#10;61.8    present policy only if, after due consideration, you find that purchase of this long-term &#10;61.9    care coverage is a wise decision.&#10;61.10   STATEMENT TO APPLICANT BY AGENT&#10;61.11   (BROKER OR OTHER REPRESENTATIVE):&#10;61.12   (Use additional sheets, as necessary.)&#10;61.13   I have reviewed your current <ins>medical health </ins>insurance coverage. I believe the &#10;61.14   replacement of insurance involved in this transaction materially improves your position. &#10;61.15   My conclusion has taken into account the following considerations, which I call to your &#10;61.16   attention:&#10;61.17   (a) Health conditions which you presently have (preexisting conditions) may not &#10;61.18   be immediately or fully covered under the new policy. This could result in denial or &#10;61.19   delay in payment of benefits under the new policy, whereas a similar claim might have &#10;61.20   been payable under your present policy.&#10;61.21   (b) State law provides that your replacement policy or certificate may not contain &#10;61.22   new preexisting conditions or probationary periods. The insurer will waive any time &#10;61.23   periods applicable to preexisting conditions or probationary periods in the new policy (or &#10;61.24   coverage) for similar benefits to the extent such time was spent (depleted) under the &#10;61.25   original policy.&#10;61.26   (c)  If you are replacing existing<ins> accident and sickness or</ins> long-term care insurance &#10;61.27   coverage, you may wish to secure the advice of your present insurer or its agent regarding &#10;61.28   the proposed replacement of your present policy. This is not only your right, but it is also &#10;61.29   in your best interest to make sure you understand all the relevant factors involved in &#10;61.30   replacing your present coverage.&#10;61.31   (d)  If, after due consideration, you still wish to terminate your present policy and &#10;61.32   replace it with new coverage, be certain to truthfully and completely answer all questions &#10;61.33   on the application concerning your medical health history. Failure to include all material &#10;61.34   medical information on an application may provide a basis for the company to deny any &#10;61.35   future claims and to refund your premium as though your policy had never been in force. &#10;61.36   After the application has been completed and before you sign it, reread it carefully to be &#10;61.37   certain that all information has been properly recorded.&#10;62.1     .......................................................... &#10;62.2    (Signature of Agent, Broker, or Other Representative)&#10;62.3    (Typed Name and Address of Agency or Broker)&#10;62.4    The  above "Notice to Applicant" was delivered to me on:&#10;<rs_table>62.5                                                                                              &#10;62.6                                                                                        (Date)&#10;62.7                                                                                              &#10;62.8                                                                       (Applicant's Signature)&#10;</rs_table>62.9    <ins><b>EFFECTIVE DATE.</b></ins><ins>This section is effective July 1, 2006.</ins>&#10;&#10;<a id="go.0.47.0"></a>62.10       Sec. 47. Minnesota Statutes 2004, section 62S.24, subdivision 4, is amended to read:&#10;62.11       Subd. 4. <b>Direct response solicitations.</b> Insurers using direct response solicitation &#10;62.12   methods shall deliver a notice regarding replacement of long-term care coverage to &#10;62.13   the applicant upon issuance of the policy. The required notice must be provided in the &#10;62.14   following manner:&#10;62.15   NOTICE TO APPLICANT REGARDING REPLACEMENT OF<ins> ACCIDENT </ins>&#10;62.16   <ins>AND SICKNESS OR </ins>LONG-TERM CARE INSURANCE&#10;62.17   (Insurance  company's name and address)&#10;62.18   SAVE THIS NOTICE! IT MAY BE&#10;62.19   IMPORTANT TO YOU IN THE FUTURE.&#10;62.20   According to (your application) (information you have furnished), you intend to &#10;62.21   lapse or otherwise terminate existing <ins>accident and sickness or </ins>long-term care insurance &#10;62.22   and replace it with the long-term care insurance policy delivered herewith issued by &#10;62.23   (company name) insurance company.&#10;62.24   Your new policy provides 30 days within which you may decide, without cost, &#10;62.25   whether you desire to keep the policy. For your own information and protection, you &#10;62.26   should be aware of and seriously consider certain factors which may affect the insurance &#10;62.27   protection available to you under the new policy.&#10;62.28   You should review this new coverage carefully, comparing it with all long-term care &#10;62.29   insurance coverage you now have, and terminate your present policy only if, after due &#10;62.30   consideration, you find that purchase of this long-term care coverage is a wise decision.&#10;62.31   (a) Health conditions which you presently have (preexisting conditions) may not &#10;62.32   be immediately or fully covered under the new policy. This could result in denial or &#10;62.33   delay in payment of benefits under the new policy, whereas a similar claim might have &#10;62.34   been payable under your present policy.&#10;63.1    (b) State law provides that your replacement policy or certificate may not contain &#10;63.2    new preexisting conditions or probationary periods. Your insurer will waive any time &#10;63.3    periods applicable to preexisting conditions or probationary periods in the new policy (or &#10;63.4    coverage) for similar benefits to the extent such time was spent (depleted) under the &#10;63.5    original policy.&#10;63.6    (c) If you are replacing existing <ins>accident and sickness or </ins>long-term care insurance &#10;63.7    coverage, you may wish to secure the advice of your present insurer or its agent regarding &#10;63.8    the proposed replacement of your present policy. This is not only your right, but it is also &#10;63.9    in your best interest to make sure you understand all the relevant factors involved in &#10;63.10   replacing your present coverage.&#10;63.11   (d) (To be included only if the application is attached to the policy.)&#10;63.12   If,  after due consideration, you still wish to terminate your present policy and replace &#10;63.13   it with new coverage, read the copy of the application attached to your new policy and be &#10;63.14   sure that all questions are answered fully and correctly. Omissions or misstatements in &#10;63.15   the application could cause an otherwise valid claim to be denied. Carefully check the &#10;63.16   application and write to (company name and address) within 30 days if any information is &#10;63.17   not correct and complete, or if any past medical history has been left out of the application.&#10;<rs_table>63.18                                                                                             &#10;63.19                                                                               (Company Name)&#10;</rs_table>63.20   <ins><b>EFFECTIVE DATE.</b></ins><ins>This section is effective July 1, 2006.</ins>&#10;&#10;<a id="go.0.48.0"></a>63.21       Sec. 48. Minnesota Statutes 2004, section 62S.24, is amended by adding a subdivision &#10;63.22   to read:&#10;63.23       <ins>Subd. 7.</ins> <ins><b>Life insurance policies.</b></ins> <ins>Life insurance policies that accelerate benefits for </ins>&#10;63.24   <ins>long-term care shall comply with this section if the policy being replaced is a long-term </ins>&#10;63.25   <ins>care insurance policy. If the policy being replaced is a life insurance policy, the insurer </ins>&#10;63.26   <ins>shall comply with the replacement requirements of sections 61A.53 to 61A.60. If a </ins>&#10;63.27   <ins>life insurance policy that accelerates benefits for long-term care is replaced by another </ins>&#10;63.28   <ins>such policy, the replacing insurer shall comply with both the long-term care and the life </ins>&#10;63.29   <ins>insurance replacement requirements.</ins>&#10;63.30   <ins><b>EFFECTIVE DATE.</b></ins><ins>This section is effective July 1, 2006.</ins>&#10;&#10;<a id="go.0.49.0"></a>63.31       Sec. 49.  Minnesota Statutes 2004, section 62S.24, is amended by adding a subdivision &#10;63.32   to read:&#10;64.1        <ins>Subd. 8.</ins> <ins><b>Exchange for long-term care partnership policy; addition of policy </b></ins>&#10;64.2    <ins><b>rider.</b></ins> <ins>(a) If authorized by federal law or a federal waiver is granted with respect to the </ins>&#10;64.3    <ins>long-term care partnership program referenced in section 256B.0571, issuers of long-term </ins>&#10;64.4    <ins>care policies may voluntarily exchange a current long-term care insurance policy for a </ins>&#10;64.5    <ins>long-term care partnership policy that meets the requirements of Public Law 109-171, </ins>&#10;64.6    <ins>section 6021, after the effective date of the state plan amendment implementing the </ins>&#10;64.7    <ins>partnership program in this state.</ins>&#10;64.8    <ins>(b) If authorized by federal law or a federal waiver is granted with respect to the </ins>&#10;64.9    <ins>long-term care partnership program referenced in section 256B.0571 allowing an existing </ins>&#10;64.10   <ins>long-term care insurance policy to qualify as a partnership policy by addition of a policy </ins>&#10;64.11   <ins>rider, the issuer of the policy is authorized to add the rider to the policy after the effective </ins>&#10;64.12   <ins>date of the state plan amendment implementing the partnership program in this state.</ins>&#10;64.13   <ins>(c) The commissioner, in cooperation with the commissioner of human services, </ins>&#10;64.14   <ins>shall pursue any federal law changes or waivers necessary to allow the implementation </ins>&#10;64.15   <ins>of paragraphs (a) and (b).</ins>&#10;64.16   <ins><b>EFFECTIVE DATE.</b></ins><ins>This section is effective July 1, 2006.</ins>&#10;&#10;<a id="go.0.50.0"></a>64.17       Sec. 50. Minnesota Statutes 2004, section 62S.25, subdivision 6, is amended to read:&#10;64.18       Subd. 6. <b>Claims denied.</b> Each insurer shall report annually by June 30 the number &#10;64.19   of claims denied <ins>for any reason </ins>during the reporting period for each class of business, &#10;64.20   expressed as a percentage of claims denied, other than claims denied for failure to meet &#10;64.21   the waiting period or because of any applicable preexisting condition.<ins> For purposes of </ins>&#10;64.22   <ins>this subdivision, "claim" means a request for payment of benefits under an in-force policy </ins>&#10;64.23   <ins>regardless of whether the benefit claimed is covered under the policy or any terms or </ins>&#10;64.24   <ins>conditions of the policy have been met.</ins>&#10;64.25   <ins><b>EFFECTIVE DATE.</b></ins><ins>This section is effective July 1, 2006.</ins>&#10;&#10;<a id="go.0.51.0"></a>64.26       Sec. 51. Minnesota Statutes 2004, section 62S.25, is amended by adding a subdivision &#10;64.27   to read:&#10;64.28       <ins>Subd. 7.</ins> <ins><b>Reports. </b></ins> <ins>Reports under this section shall be done on a statewide basis and </ins>&#10;64.29   <ins>filed with the commissioner. They shall include, at a minimum, the information in the </ins>&#10;64.30   <ins>format contained in Appendix E (Claim Denial Reporting Form) and in Appendix G </ins>&#10;64.31   <ins>(Replacement and Lapse Reporting Form) of the Long-Term Care Model Regulation </ins>&#10;64.32   <ins>adopted by the National Association of Insurance Commissioners.</ins>&#10;64.33   <ins><b>EFFECTIVE DATE.</b></ins><ins>This section is effective July 1, 2006.</ins>&#10;&#10;<a id="go.0.52.0"></a>65.1        Sec. 52. Minnesota Statutes 2004, section 62S.26, is amended to read:&#10;65.2    <b>62S.26 LOSS RATIO.</b>&#10;65.3        <ins>Subdivision 1.</ins> <ins><b>Minimum loss ratio.</b></ins>  <del>(a) </del>The minimum loss ratio must be at least 60 &#10;65.4    percent, calculated in a manner which provides for adequate reserving of the long-term &#10;65.5    care insurance risk. In evaluating the expected loss ratio, the commissioner shall give &#10;65.6    consideration to all relevant factors, including:&#10;65.7    (1) statistical credibility of incurred claims experience and earned premiums;&#10;65.8    (2) the period for which rates are computed to provide coverage;&#10;65.9    (3) experienced and projected trends;&#10;65.10   (4) concentration of experience within early policy duration;&#10;65.11   (5) expected claim fluctuation;&#10;65.12   (6) experience refunds, adjustments, or dividends;&#10;65.13   (7) renewability features;&#10;65.14   (8) all appropriate expense factors;&#10;65.15   (9) interest;&#10;65.16   (10) experimental nature of the coverage;&#10;65.17   (11) policy reserves;&#10;65.18   (12) mix of business by risk classification; and&#10;65.19   (13) product features such as long elimination periods, high deductibles, and high &#10;65.20   maximum limits.&#10;65.21       <ins>Subd. 2.</ins> <ins><b>Life insurance policies.</b></ins> <ins>Subdivision 1 shall not apply to life insurance </ins>&#10;65.22   <ins>policies that accelerate benefits for long-term care. A life insurance policy that funds </ins>&#10;65.23   <ins>long-term care benefits entirely by accelerating the death benefit is considered to provide </ins>&#10;65.24   <ins>reasonable benefits in relation to premiums paid, if the policy complies with all of the </ins>&#10;65.25   <ins>following provisions:</ins>&#10;65.26   <ins>(1) the interest credited internally to determine cash value accumulations, including </ins>&#10;65.27   <ins>long-term care, if any, are guaranteed not to be less than the minimum guaranteed interest </ins>&#10;65.28   <ins>rate for cash value accumulations without long-term care set forth in the policy;</ins>&#10;65.29   <ins>(2) the portion of the policy that provides life insurance benefits meets the </ins>&#10;65.30   <ins>nonforfeiture requirements of section 61A.24;</ins>&#10;65.31   <ins>(3) the policy meets the disclosure requirements of sections 62S.09, 62S.10, and </ins>&#10;65.32   <ins>62S.11; and </ins>&#10;65.33   <ins>(4) an actuarial memorandum is filed with the commissioner that includes:</ins>&#10;65.34   <ins>(i) a description of the basis on which the long-term care rates were determined;</ins>&#10;65.35   <ins>(ii) a description of the basis for the reserves;</ins>&#10;66.1    <ins>(iii) a summary of the type of policy, benefits, renewability, general marketing </ins>&#10;66.2    <ins>method, and limits on ages of issuance;</ins>&#10;66.3    <ins>(iv) a description and a table of each actuarial assumption used. For expenses, </ins>&#10;66.4    <ins>an insurer must include percentage of premium dollars per policy and dollars per unit </ins>&#10;66.5    <ins>of benefits, if any;</ins>&#10;66.6    <ins>(v) a description and a table of the anticipated policy reserves and additional reserves </ins>&#10;66.7    <ins>to be held in each future year for active lives;</ins>&#10;66.8    <ins>(vi) the estimated average annual premium per policy and the average issue age; </ins>&#10;66.9    <ins>(vii) a statement as to whether underwriting is performed at the time of application. </ins>&#10;66.10   <ins>The statement shall indicate whether underwriting is used and, if used, the statement </ins>&#10;66.11   <ins>shall include a description of the type or types of underwriting used, such as medical </ins>&#10;66.12   <ins>underwriting or functional assessment underwriting. Concerning a group policy, the </ins>&#10;66.13   <ins>statement shall indicate whether the enrollee or any dependent will be underwritten and </ins>&#10;66.14   <ins>when underwriting occurs; and</ins>&#10;66.15   <ins>(viii) a description of the effect of the long-term care policy provision on the required </ins>&#10;66.16   <ins>premiums, nonforfeiture values, and reserves on the underlying life insurance policy, both </ins>&#10;66.17   <ins>for active lives and those in long-term care claim status.</ins>&#10;66.18       <ins>Subd. 3.</ins> <ins><b>Nonapplication. </b></ins> <del>(b)</del> This section does not apply to policies or certificates &#10;66.19   that are subject to sections  62S.021,  62S.081, and  62S.265, and that comply with those &#10;66.20   sections. &#10;66.21   <ins><b>EFFECTIVE DATE.</b></ins><ins>This section is effective July 1, 2006.</ins>&#10;&#10;<a id="go.0.53.0"></a>66.22       Sec. 53. Minnesota Statutes 2004, section 62S.266, subdivision 2, is amended to read:&#10;66.23       Subd. 2. <b>Requirement.</b> <ins>(a) </ins>An insurer must offer each prospective policyholder a &#10;66.24   nonforfeiture benefit in compliance with the following requirements:&#10;66.25   (1) a policy or certificate offered with nonforfeiture benefits must have coverage &#10;66.26   elements, eligibility, benefit triggers, and benefit length that are the same as coverage to be &#10;66.27   issued without nonforfeiture benefits. The nonforfeiture benefit included in the offer must &#10;66.28   be the benefit described in subdivision 5; and&#10;66.29   (2)  the offer must be in writing if the nonforfeiture benefit is not otherwise described &#10;66.30   in the outline of coverage or other materials given to the prospective policyholder.&#10;66.31   <ins>(b) When a group long-term care insurance policy is issued, the offer required in </ins>&#10;66.32   <ins>paragraph (a) shall be made to the group policy holder. However, if the policy is issued as </ins>&#10;66.33   <ins>group long-term care insurance as defined in section 62S.01, subdivision 15, clause (4), </ins>&#10;66.34   <ins>other than to a continuing care retirement community or other similar entity, the offering </ins>&#10;66.35   <ins>shall be made to each proposed certificate holder. </ins>&#10;67.1    <ins><b>EFFECTIVE DATE.</b></ins><ins>This section is effective July 1, 2006.</ins>&#10;&#10;<a id="go.0.54.0"></a>67.2        Sec. 54. Minnesota Statutes 2004, section 62S.29, subdivision 1, is amended to read:&#10;67.3        Subdivision 1. <b>Requirements.</b> An insurer or other entity marketing long-term care &#10;67.4    insurance coverage in this state, directly or through its producers, shall:&#10;67.5    (1) establish marketing procedures <ins>and agent training requirements </ins>to assure that <del>a</del> &#10;67.6    <ins>any marketing activities, including any </ins>comparison of policies by its agents or other &#10;67.7    producers<ins>,</ins> are fair and accurate;&#10;67.8    (2) establish marketing procedures to assure excessive insurance is not sold or issued;&#10;67.9    (3) display prominently by type, stamp, or other appropriate means, on the first page &#10;67.10   of the outline of coverage and policy, the following:&#10;67.11   "Notice to buyer: This policy may not cover all of the costs associated with &#10;67.12   long-term care incurred by the buyer during the period of coverage. The buyer is advised &#10;67.13   to review carefully all policy limitations.";&#10;67.14   (4) <ins>provide copies of the disclosure forms required in section 62S.081, subdivision </ins>&#10;67.15   <ins>4, to the applicant;</ins>&#10;67.16   <ins>(5) </ins>inquire and otherwise make every reasonable effort to identify whether a &#10;67.17   prospective applicant or enrollee for long-term care insurance already has long-term care &#10;67.18   insurance and the types and amounts of the insurance;&#10;67.19   <del>(5)</del> <ins>(6) </ins>establish auditable procedures for verifying compliance with this subdivision; &#10;67.20   <del>and</del>&#10;67.21   <del>(6)</del> <ins>(7) </ins>if applicable, provide written notice to the prospective policyholder and &#10;67.22   certificate holder, at solicitation, that a senior insurance counseling program approved &#10;67.23   by the commissioner is available and the name, address, and telephone number of the &#10;67.24   program<ins>;</ins>&#10;67.25   <ins>(8) use the terms "noncancelable" or "level premium" only when the policy or </ins>&#10;67.26   <ins>certificate conforms to section 62S.14; and</ins>&#10;67.27   <ins>(9) provide an explanation of contingent benefit upon lapse provided for in section </ins>&#10;67.28   <ins>62S.266</ins>.&#10;67.29   <ins><b>EFFECTIVE DATE.</b></ins><ins>This section is effective July 1, 2006.</ins>&#10;&#10;<a id="go.0.55.0"></a>67.30       Sec. 55. Minnesota Statutes 2004, section 62S.30, is amended to read:&#10;67.31   <b>62S.30 </b><del><b>APPROPRIATENESS OF RECOMMENDED PURCHASE</b></del><ins><b> </b></ins>&#10;67.32   <ins><b>SUITABILITY</b></ins><b>.</b>&#10;68.1    <del>In recommending the purchase or replacement of a long-term care insurance policy </del>&#10;68.2    <del>or certificate, an agent shall comply with section  </del><del>60K.46, subdivision 4</del><del>. </del>&#10;68.3        <ins>Subdivision 1.</ins> <ins><b>Standards.</b></ins> <ins>Every insurer or other entity marketing long-term care </ins>&#10;68.4    <ins>insurance shall:</ins>&#10;68.5    <ins>(1) develop and use suitability standards to determine whether the purchase or </ins>&#10;68.6    <ins>replacement of long-term care insurance is appropriate for the needs of the applicant; </ins>&#10;68.7    <ins>(2) train its agents in the use of its suitability standards; and </ins>&#10;68.8    <ins>(3) maintain a copy of its suitability standards and make them available for </ins>&#10;68.9    <ins>inspection upon request by the commissioner.</ins>&#10;68.10       <ins>Subd. 2.</ins> <ins><b>Procedures.</b></ins> <ins>(a) To determine whether the applicant meets the standards </ins>&#10;68.11   <ins>developed by the insurer or other entity marketing long-term care insurance, the agent </ins>&#10;68.12   <ins>and insurer or other entity marketing long-term care insurance shall develop procedures </ins>&#10;68.13   <ins>that take the following into consideration:</ins>&#10;68.14   <ins>(1) the ability to pay for the proposed coverage and other pertinent financial </ins>&#10;68.15   <ins>information related to the purchase of the coverage;</ins>&#10;68.16   <ins>(2) the applicant's goals or needs with respect to long-term care and the advantages </ins>&#10;68.17   <ins>and disadvantages of insurance to meet those goals or needs; and </ins>&#10;68.18   <ins>(3) the values, benefits, and costs of the applicant's existing insurance, if any, when </ins>&#10;68.19   <ins>compared to the values, benefits, and costs of the recommended purchase or replacement.</ins>&#10;68.20   <ins>(b) The insurer or other entity marketing long-term care insurance, and the agent, </ins>&#10;68.21   <ins>where an agent is involved, shall make reasonable efforts to obtain the information set </ins>&#10;68.22   <ins>forth in paragraph (a). The efforts shall include presentation to the applicant, at or prior </ins>&#10;68.23   <ins>to application, of the "Long-Term Care Insurance Personal Worksheet." The personal </ins>&#10;68.24   <ins>worksheet used by the insurer or other entity marketing long-term care insurance shall </ins>&#10;68.25   <ins>contain, at a minimum, the information in the format contained in Appendix B of the </ins>&#10;68.26   <ins>Long-Term Care Model Regulation adopted by the National Association of Insurance </ins>&#10;68.27   <ins>Commissioners, in not less than 12-point type. The insurer or other entity marketing </ins>&#10;68.28   <ins>long-term care insurance may request the applicant to provide additional information to </ins>&#10;68.29   <ins>comply with its suitability standards. The insurer or other entity marketing long-term care </ins>&#10;68.30   <ins>insurance shall file a copy of its personal worksheet with the commissioner.</ins>&#10;68.31   <ins>(c) A completed personal worksheet shall be returned to the insurer or other entity </ins>&#10;68.32   <ins>marketing long-term care insurance prior to consideration of the applicant for coverage, </ins>&#10;68.33   <ins>except the personal worksheet need not be returned for sales of employer group long-term </ins>&#10;68.34   <ins>care insurance to employees and their spouses. The sale or dissemination by the insurer </ins>&#10;68.35   <ins>or other entity marketing long-term care insurance, or the agent, of information obtained </ins>&#10;68.36   <ins>through the personal worksheet is prohibited.</ins>&#10;69.1    <ins>(d) The insurer or other entity marketing long-term care insurance shall use the </ins>&#10;69.2    <ins>suitability standards it has developed under this section in determining whether issuing </ins>&#10;69.3    <ins>long-term care insurance coverage to an applicant is appropriate. Agents shall use the </ins>&#10;69.4    <ins>suitability standards developed by the insurer or other entity marketing long-term care </ins>&#10;69.5    <ins>insurance in marketing long-term care insurance.</ins>&#10;69.6    <ins>(e) At the same time as the personal worksheet is provided to the applicant, the </ins>&#10;69.7    <ins>disclosure form entitled "Things You Should Know Before You Buy Long-Term Care </ins>&#10;69.8    <ins>Insurance" shall be provided. The form shall be in the format contained in Appendix C of </ins>&#10;69.9    <ins>the Long-Term Care Insurance Model Regulation adopted by the National Association of </ins>&#10;69.10   <ins>Insurance Commissioners in not less than 12-point type.</ins>&#10;69.11   <ins>(f) If the insurer or other entity marketing long-term care insurance determines </ins>&#10;69.12   <ins>that the applicant does not meet its financial suitability standards, or if the applicant has </ins>&#10;69.13   <ins>declined to provide the information, the insurer or other entity marketing long-term </ins>&#10;69.14   <ins>care insurance may reject the application. In the alternative, the insurer or other entity </ins>&#10;69.15   <ins>marketing long-term care insurance shall send the applicant a letter similar to Appendix D </ins>&#10;69.16   <ins>of the Long-Term Care Insurance Model Regulation adopted by the National Association </ins>&#10;69.17   <ins>of Insurance Commissioners. However, if the applicant has declined to provide financial </ins>&#10;69.18   <ins>information, the insurer or other entity marketing long-term care insurance may use some </ins>&#10;69.19   <ins>other method to verify the applicant's intent. The applicant's returned letter or a record of </ins>&#10;69.20   <ins>the alternative method of verification shall be made part of the applicant's file.</ins>&#10;69.21       <ins>Subd. 3.</ins> <ins><b>Reports.</b></ins> <ins>The insurer or other entity marketing long-term care insurance </ins>&#10;69.22   <ins>shall report annually to the commissioner the total number of applications received from </ins>&#10;69.23   <ins>residents of this state, the number of those who declined to provide information on the </ins>&#10;69.24   <ins>personal worksheet, the number of applicants who did not meet the suitability standards, </ins>&#10;69.25   <ins>and the number of those who chose to confirm after receiving a suitability letter.</ins>&#10;69.26       <ins>Subd. 4.</ins> <ins><b>Application.</b></ins> <ins>This section shall not apply to life insurance policies that </ins>&#10;69.27   <ins>accelerate benefits for long-term care.</ins>&#10;69.28   <ins><b>EFFECTIVE DATE.</b></ins><ins>This section is effective July 1, 2006.</ins>&#10;&#10;<a id="go.0.56.0"></a>69.29       Sec. 56. <ins><b>[62S.315] PRODUCER TRAINING.</b></ins>&#10;69.30   <ins>The commissioner shall approve insurer and producer training requirements </ins>&#10;69.31   <ins>according to the NAIC Long-Term Care Insurance Model Act provisions. The </ins>&#10;69.32   <ins>commissioner of human services shall provide technical assistance and information to the </ins>&#10;69.33   <ins>commissioner according to Public Law 109-171, section 6021.</ins>&#10;69.34   <ins><b>EFFECTIVE DATE.</b></ins><ins>This section is effective July 1, 2006.</ins>&#10;&#10;<a id="go.0.57.0"></a>70.1        Sec. 57. Minnesota Statutes 2004, section 65B.44, subdivision 3a, is amended to read:&#10;70.2        Subd. 3a. <b>Disability and income loss benefits election; senior citizens.</b> A plan of &#10;70.3    reparation security issued to or renewed with a person who has attained the age of 65<ins> or </ins>&#10;70.4    <ins>who has attained the age of 60</ins> years<ins> and is retired and receiving a pension,</ins> must provide &#10;70.5    disability and income loss benefits under section  65B.44, subdivision 3, unless the insured &#10;70.6    elects not to have this coverage. An election by the insured not to have this coverage &#10;70.7    remains in effect until revoked by the insured. The reparation obligor shall notify a person &#10;70.8    of the person's rights under this section at the time of the sale or the first renewal of the &#10;70.9    policy after the insured has attained the age of <del>65</del><ins> 60</ins> years<del>,</del> and at least annually after that. &#10;70.10   The rate for any plan for which coverage has been excluded or reduced pursuant to this &#10;70.11   section must be reduced accordingly. This section does apply to self-insurance. &#10;70.12   <ins><b>EFFECTIVE DATE.</b></ins><ins>This section is effective August 1, 2006, and applies to plans </ins>&#10;70.13   <ins>of reparation security issued or renewed on or after that date.</ins>&#10;&#10;<a id="go.0.58.0"></a>70.14       Sec. 58. Minnesota Statutes 2004, section 70A.07, is amended to read:&#10;70.15   <b>70A.07 RATES AND FORMS OPEN TO INSPECTION.</b>&#10;70.16   All rates, supplementary rate information, and forms furnished to the commissioner &#10;70.17   under this chapter shall, <del>as soon as the commissioner's review has been completed</del><ins> within </ins>&#10;70.18   <ins>ten days after their effective date</ins>, be open to public inspection at any reasonable time.&#10;&#10;<a id="go.0.59.0"></a>70.19       Sec. 59. Minnesota Statutes 2004, section 72A.20, is amended by adding a subdivision &#10;70.20   to read:&#10;70.21       <ins>Subd. 39.</ins> <ins><b>Discounted payments by health care providers; effect on use of </b></ins>&#10;70.22   <ins><b>usual and customary payments.</b></ins> <ins>An insurer, including, but not limited to, a health plan </ins>&#10;70.23   <ins>company as defined in section 62Q.01, subdivision 4; a reparation obligor as defined in </ins>&#10;70.24   <ins>section 65B.43, subdivision 9; and a workers' compensation insurer shall not consider in </ins>&#10;70.25   <ins>determining a health care provider's usual and customary payment, standard payment, or </ins>&#10;70.26   <ins>allowable payment used as a basis for determining the provider's payment by the insurer, </ins>&#10;70.27   <ins>the following discounted payment situations:</ins>&#10;70.28   <ins>(1) care provided to relatives of the provider;</ins>&#10;70.29   <ins>(2) care for which a discount or free care is given in hardship situations; and</ins>&#10;70.30   <ins>(3) care for which a discount is given in exchange for cash payment.</ins>&#10;70.31   <ins>For purposes of this subdivision, "health care provider" and "provider" have the </ins>&#10;70.32   <ins>meaning given in section 62J.03, subdivision 8.</ins>&#10;70.33   <ins><b>EFFECTIVE DATE.</b></ins><ins>This section is effective the day following final enactment.</ins>&#10;&#10;<a id="go.0.60.0"></a>71.1        Sec. 60. Minnesota Statutes 2005 Supplement, section 72A.201, subdivision 6, is &#10;71.2    amended to read:&#10;71.3        Subd. 6. <b>Standards for automobile insurance claims handling, settlement offers, </b>&#10;71.4    <b>and agreements.</b> In addition to the acts specified in subdivisions 4, 5, 7, 8, and 9, the &#10;71.5    following acts by an insurer, adjuster, or a self-insured or self-insurance administrator &#10;71.6    constitute unfair settlement practices:&#10;71.7    (1) if an automobile insurance policy provides for the adjustment and settlement &#10;71.8    of an automobile total loss on the basis of actual cash value or replacement with like &#10;71.9    kind and quality and the insured is not an automobile dealer, failing to offer one of the &#10;71.10   following methods of settlement:&#10;71.11   (a) comparable and available replacement automobile, with all applicable taxes, &#10;71.12   license fees, at least pro rata for the unexpired term of the replaced automobile's license, &#10;71.13   and other fees incident to the transfer or evidence of ownership of the automobile paid, at &#10;71.14   no cost to the insured other than the deductible amount as provided in the policy;&#10;71.15   (b) a cash settlement based upon the actual cost of purchase of a comparable &#10;71.16   automobile, including all applicable taxes, license fees, at least pro rata for the unexpired &#10;71.17   term of the replaced automobile's license, and other fees incident to transfer of evidence &#10;71.18   of ownership, less the deductible amount as provided in the policy. The costs must be &#10;71.19   determined by:&#10;71.20   (i) the cost of a comparable automobile, adjusted for mileage, condition, and options, &#10;71.21   in the local market area of the insured, if such an automobile is available in that area; or&#10;71.22   (ii) one of two or more quotations obtained from two or more qualified sources &#10;71.23   located within the local market area when a comparable automobile is not available in &#10;71.24   the local market area. The insured shall be provided the information contained in all &#10;71.25   quotations prior to settlement; or&#10;71.26   (iii) any settlement or offer of settlement which deviates from the procedure above &#10;71.27   must be documented and justified in detail. The basis for the settlement or offer of &#10;71.28   settlement must be explained to the insured;&#10;71.29   (2) if an automobile insurance policy provides for the adjustment and settlement &#10;71.30   of an automobile partial loss on the basis of repair or replacement with like kind and &#10;71.31   quality and the insured is not an automobile dealer, failing to offer one of the following &#10;71.32   methods of settlement:&#10;71.33   (a) to assume all costs, including reasonable towing costs, for the satisfactory repair &#10;71.34   of the motor vehicle. Satisfactory repair includes repair of both obvious and hidden &#10;71.35   damage as caused by the claim incident. This assumption of cost may be reduced by &#10;71.36   applicable policy provision; or&#10;72.1    (b) to offer a cash settlement sufficient to pay for satisfactory repair of the vehicle. &#10;72.2    Satisfactory repair includes repair of obvious and hidden damage caused by the claim &#10;72.3    incident, and includes reasonable towing costs;&#10;72.4    (3) regardless of whether the loss was total or partial, in the event that a damaged &#10;72.5    vehicle of an insured cannot be safely driven, failing to exercise the right to inspect &#10;72.6    automobile damage prior to repair within five business days following receipt of &#10;72.7    notification of claim. In other cases the inspection must be made in 15 days;&#10;72.8    (4) regardless of whether the loss was total or partial, requiring unreasonable travel &#10;72.9    of a claimant or insured to inspect a replacement automobile, to obtain a repair estimate, &#10;72.10   to allow an insurer to inspect a repair estimate, to allow an insurer to inspect repairs made &#10;72.11   pursuant to policy requirements, or to have the automobile repaired;&#10;72.12   (5) regardless of whether the loss was total or partial, if loss of use coverage &#10;72.13   exists under the insurance policy, failing to notify an insured at the time of the insurer's &#10;72.14   acknowledgment of claim, or sooner if inquiry is made, of the fact of the coverage, &#10;72.15   including the policy terms and conditions affecting the coverage and the manner in which &#10;72.16   the insured can apply for this coverage;&#10;72.17   (6) regardless of whether the loss was total or partial, failing to include the insured's &#10;72.18   deductible in the insurer's demands under its subrogation rights. Subrogation recovery &#10;72.19   must be shared at least on a proportionate basis with the insured, unless the deductible &#10;72.20   amount has been otherwise recovered by the insured, except that when an insurer is &#10;72.21   recovering directly from an uninsured third party by means of installments, the insured &#10;72.22   must receive the full deductible share as soon as that amount is collected and before any &#10;72.23   part of the total recovery is applied to any other use. No deduction for expenses may be &#10;72.24   made from the deductible recovery unless an attorney is retained to collect the recovery, in &#10;72.25   which case deduction may be made only for a pro rata share of the cost of retaining the &#10;72.26   attorney. An insured is not bound by any settlement of its insurer's subrogation claim with &#10;72.27   respect to the deductible amount, unless the insured receives, as a result of the subrogation &#10;72.28   settlement, the full amount of the deductible. Recovery by the insurer and receipt by the &#10;72.29   insured of less than all of the insured's deductible amount does not affect the insured's &#10;72.30   rights to recover any unreimbursed portion of the deductible from parties liable for the loss;&#10;72.31   (7) requiring as a condition of payment of a claim that repairs to any damaged &#10;72.32   vehicle must be made by a particular contractor or repair shop or that parts, other than &#10;72.33   window glass, must be replaced with parts other than original equipment parts or engaging &#10;72.34   in any act or practice of intimidation, coercion, threat, incentive, or inducement for or &#10;72.35   against an insured to use a particular contractor or repair shop. Consumer benefits included &#10;72.36   within preferred vendor programs must not be considered an incentive or inducement. &#10;73.1    At the time a claim is reported, the insurer must provide the following advisory to the &#10;73.2    insured or claimant:&#10;73.3    "<del>Minnesota law gives</del> You <ins>have </ins>the<ins> legal</ins> right to choose a repair shop to fix your &#10;73.4    vehicle. Your policy will cover the reasonable costs of repairing your vehicle to its &#10;73.5    pre-accident condition no matter where you have repairs made. Have you selected a &#10;73.6    repair shop or would you like a referral?"&#10;73.7    After an insured has indicated that the insured has selected a repair shop, the insurer &#10;73.8    must cease all efforts to influence the insured's or claimant's choice of repair shop;&#10;73.9    (8) where liability is reasonably clear, failing to inform the claimant in an automobile &#10;73.10   property damage liability claim that the claimant may have a claim for loss of use of &#10;73.11   the vehicle;&#10;73.12   (9) failing to make a good faith assignment of comparative negligence percentages &#10;73.13   in ascertaining the issue of liability;&#10;73.14   (10) failing to pay any interest required by statute on overdue payment for an &#10;73.15   automobile personal injury protection claim;&#10;73.16   (11) if an automobile insurance policy contains either or both of the time limitation &#10;73.17   provisions as permitted by section 65B.55, subdivisions 1 and 2, failing to notify the &#10;73.18   insured in writing of those limitations at least 60 days prior to the expiration of that time &#10;73.19   limitation;&#10;73.20   (12) if an insurer chooses to have an insured examined as permitted by section &#10;73.21   65B.56, subdivision 1, failing to notify the insured of all of the insured's rights and &#10;73.22   obligations under that statute, including the right to request, in writing, and to receive &#10;73.23   a copy of the report of the examination;&#10;73.24   (13) failing to provide, to an insured who has submitted a claim for benefits &#10;73.25   described in section 65B.44, a complete copy of the insurer's claim file on the insured, &#10;73.26   excluding internal company memoranda, all materials that relate to any insurance fraud &#10;73.27   investigation, materials that constitute attorney work-product or that qualify for the &#10;73.28   attorney-client privilege, and medical reviews that are subject to section 145.64, within ten &#10;73.29   business days of receiving a written request from the insured. The insurer may charge &#10;73.30   the insured a reasonable copying fee. This clause supersedes any inconsistent provisions &#10;73.31   of sections 72A.49 to 72A.505;&#10;73.32   (14) if an automobile policy provides for the adjustment or settlement of an &#10;73.33   automobile loss due to damaged window glass, failing to provide payment to the insured's &#10;73.34   chosen vendor based on a competitive price that is fair and reasonable within the local &#10;73.35   industry at large.&#10;74.1    Where facts establish that a different rate in a specific geographic area actually served &#10;74.2    by the vendor is required by that market, that geographic area must be considered. This &#10;74.3    clause does not prohibit an insurer from recommending a vendor to the insured or from &#10;74.4    agreeing with a vendor to perform work at an agreed-upon price, provided, however, &#10;74.5    that before recommending a vendor, the insurer shall offer its insured the opportunity to &#10;74.6    choose the vendor. If the insurer recommends a vendor, the insurer must also provide &#10;74.7    the following advisory:&#10;74.8    "Minnesota law gives you the right to go to any glass vendor you choose, and &#10;74.9    prohibits me from pressuring you to choose a particular vendor.";&#10;74.10   (15) requiring that the repair or replacement of motor vehicle glass and related &#10;74.11   products and services be made in a particular place or shop or by a particular entity, or by &#10;74.12   otherwise limiting the ability of the insured to select the place, shop, or entity to repair or &#10;74.13   replace the motor vehicle glass and related products and services; or&#10;74.14   (16) engaging in any act or practice of intimidation, coercion, threat, incentive, or &#10;74.15   inducement for or against an insured to use a particular company or location to provide &#10;74.16   the motor vehicle glass repair or replacement services or products. For purposes of this &#10;74.17   section, a warranty shall not be considered an inducement or incentive.&#10;&#10;<a id="go.0.61.0"></a>74.18       Sec. 61. Minnesota Statutes 2004, section 72C.10, subdivision 1, is amended to read:&#10;74.19       Subdivision 1. <b>Readability compliance; filing and approval.</b> No insurer shall &#10;74.20   make, issue, amend, or renew any policy or contract after the dates specified in section  &#10;74.21   72C.11 for the applicable type of policy unless the contract is in compliance with the &#10;74.22   requirements of sections  72C.06 to  72C.09 and unless the contract is filed with the &#10;74.23   commissioner for approval. The contract shall be deemed approved <del>90</del> <ins> 60 </ins>days after filing &#10;74.24   unless disapproved by the commissioner within the <del>90-day</del><ins> 60-day</ins> period. <ins>When an </ins>&#10;74.25   <ins>insurer, service plan corporation, or the Minnesota Comprehensive Health Association </ins>&#10;74.26   <ins>fails to respond to an objection or inquiry within 60 days, the filing is automatically </ins>&#10;74.27   <ins>disapproved. A resubmission is required if action by the Department of Commerce </ins>&#10;74.28   <ins>is subsequently requested. An additional filing fee is required for the resubmission. </ins>&#10;74.29   The commissioner shall not unreasonably withhold approval. Any disapproval shall be &#10;74.30   delivered to the insurer in writing, stating the grounds therefor. Any policy filed with the &#10;74.31   commissioner shall be accompanied by a Flesch scale readability analysis and test score &#10;74.32   and by the insurer's certification that the policy or contract is in its judgment readable &#10;74.33   based on the factors specified in sections  72C.06 to  72C.08. &#10;&#10;<a id="go.0.62.0"></a>75.1        Sec. 62. Minnesota Statutes 2004, section 79.01, is amended by adding a subdivision &#10;75.2    to read:&#10;75.3        <ins>Subd. 1a.</ins> <ins><b>Assigned risk plan.</b></ins> <ins>"Assigned risk plan" means:</ins>&#10;75.4    <ins>(1) the method to provide workers' compensation coverage to employers unable to </ins>&#10;75.5    <ins>obtain coverage through licensed workers' compensation companies; and</ins>&#10;75.6    <ins>(2) the procedures established by the commissioner to implement that method of </ins>&#10;75.7    <ins>providing coverage including administration of all assigned risk losses and reserves.</ins>&#10;&#10;<a id="go.0.63.0"></a>75.8        Sec. 63. Minnesota Statutes 2004, section 79.01, is amended by adding a subdivision &#10;75.9    to read:&#10;75.10       <ins>Subd. 1b.</ins> <ins><b>Employer.</b></ins> <ins>"Employer" has the meaning given in section 176.011, </ins>&#10;75.11   <ins>subdivision 10.</ins>&#10;&#10;<a id="go.0.64.0"></a>75.12       Sec. 64. Minnesota Statutes 2004, section 79.251, subdivision 1, is amended to read:&#10;75.13       Subdivision 1. <b>General duties of commissioner.</b> (a)(1) The commissioner shall &#10;75.14   have all the usual powers and authorities necessary for the discharge of the commissioner's &#10;75.15   duties under this section and may contract with individuals in discharge of those duties. &#10;75.16   The commissioner shall audit the reserves established (a) for individual cases arising &#10;75.17   under policies and contracts of coverage issued under subdivision 4 and (b) for the total &#10;75.18   book of business issued under subdivision 4. If the commissioner determines on the basis &#10;75.19   of an audit that there is an excess surplus in the assigned risk plan, the commissioner must &#10;75.20   notify the commissioner of finance who shall transfer assets of the plan equal to the excess &#10;75.21   surplus to the budget reserve account in the general fund.&#10;75.22   (2) The commissioner shall monitor the operations of section  79.252 and this section &#10;75.23   and shall periodically make recommendations to the governor and legislature when &#10;75.24   appropriate, for improvement in the operation of those sections. &#10;75.25   (3) All insurers and self-insurance administrators issuing policies or contracts under &#10;75.26   subdivision 4 shall pay to the commissioner a .25 percent assessment on premiums for &#10;75.27   policies and contracts of coverage issued under subdivision 4 for the purpose of defraying &#10;75.28   the costs of performing the duties under clauses (1) and (2). Proceeds of the assessment &#10;75.29   shall be deposited in the state treasury and credited to the general fund.&#10;75.30   (4) The assigned risk plan shall not be deemed a state agency.&#10;75.31   <ins>(5) The commissioner shall monitor and have jurisdiction over all reserves </ins>&#10;75.32   <ins>maintained for assigned risk plan losses.</ins>&#10;76.1    (b) As used in this subdivision, "excess surplus" means the amount of assigned &#10;76.2    risk plan assets in excess of the amount needed to pay all current liabilities of the plan, &#10;76.3    including, but not limited to:&#10;76.4    (1) administrative expenses;&#10;76.5    (2) benefit claims; and&#10;76.6    (3) if the assigned risk plan is dissolved under subdivision 8, the amounts that would &#10;76.7    be due insurers who have paid assessments to the plan.&#10;&#10;<a id="go.0.65.0"></a>76.8        Sec. 65. Minnesota Statutes 2004, section 79.251, is amended by adding a subdivision &#10;76.9    to read:&#10;76.10       <ins>Subd. 2a.</ins> <ins><b>Assigned risk rating plan.</b></ins> <ins>(a) Employers insured through the assigned </ins>&#10;76.11   <ins>risk plan are subject to paragraphs (b) and (c).</ins>&#10;76.12   <ins>(b) Classifications must be assigned according to a uniform classification system </ins>&#10;76.13   <ins>approved by the commissioner.</ins>&#10;76.14   <ins>(c) Rates must be modified according to an experience rating plan approved by the </ins>&#10;76.15   <ins>commissioner. Any experience rating plan is subject to Minnesota Rules, parts 2700.2800 </ins>&#10;76.16   <ins>and 2700.2900.</ins>&#10;&#10;<a id="go.0.66.0"></a>76.17       Sec. 66. Minnesota Statutes 2004, section 79.252, is amended by adding a subdivision &#10;76.18   to read:&#10;76.19       <ins>Subd. 2a.</ins> <ins><b>Minimum qualifications.</b></ins> <ins>Any employer that (1) is required to carry </ins>&#10;76.20   <ins>workers' compensation insurance pursuant to chapter 176 and (2) has a current written </ins>&#10;76.21   <ins>notice of refusal to insure pursuant to subdivision 2, is entitled to coverage upon making </ins>&#10;76.22   <ins>written application to the assigned risk plan, and paying the applicable premium.</ins>&#10;&#10;<a id="go.0.67.0"></a>76.23       Sec. 67. Minnesota Statutes 2004, section 79.252, is amended by adding a subdivision &#10;76.24   to read:&#10;76.25       <ins>Subd. 3a.</ins> <ins><b>Disqualifying factors.</b></ins> <ins>An employer may be denied or terminated from </ins>&#10;76.26   <ins>coverage through the assigned risk plan if the employer:</ins>&#10;76.27   <ins>(1) applies for coverage for only a portion of the employer's statutory liability under </ins>&#10;76.28   <ins>chapter 176, excluding wrap-up policies;</ins>&#10;76.29   <ins>(2) has an outstanding debt due and owing to the assigned risk plan at the time of </ins>&#10;76.30   <ins>renewal arising from a prior policy;</ins>&#10;76.31   <ins>(3) persistently refuses to permit completion of an adequate payroll audit;</ins>&#10;76.32   <ins>(4) repeatedly submits misleading or erroneous payroll information; or</ins>&#10;77.1    <ins>(5) flagrantly disregards safety or loss control recommendations. Cancellation for </ins>&#10;77.2    <ins>nonpayment of premium may be initiated by the service contractor upon 60 days' written </ins>&#10;77.3    <ins>notice to the employer pursuant to section 176.185, subdivision 1. </ins>&#10;&#10;<a id="go.0.68.0"></a>77.4        Sec. 68. Minnesota Statutes 2004, section 79.252, is amended by adding a subdivision &#10;77.5    to read:&#10;77.6        <ins>Subd. 3b.</ins> <ins><b>Occupational disease exposure.</b></ins> <ins>An employer having a significant </ins>&#10;77.7    <ins>occupational disease exposure, as determined by the commissioner, to be entitled to </ins>&#10;77.8    <ins>coverage shall have physical examinations made:</ins>&#10;77.9    <ins>(a) of employees who have not been examined within one year of the date of </ins>&#10;77.10   <ins>application for assignment;</ins>&#10;77.11   <ins>(b) of new employees before hiring; and</ins>&#10;77.12   <ins>(c) of terminated employees. Upon request, the findings and reports of doctors </ins>&#10;77.13   <ins>making examinations, together with x-rays and other original exhibits, must be furnished </ins>&#10;77.14   <ins>to the assigned risk plan or the Department of Labor and Industry.</ins>&#10;&#10;<a id="go.0.69.0"></a>77.15       Sec. 69. Minnesota Statutes 2005 Supplement, section 79A.04, subdivision 2, is &#10;77.16   amended to read:&#10;77.17       Subd. 2. <b>Minimum deposit.</b> The minimum deposit is 110 percent of the private &#10;77.18   self-insurer's estimated future liability. The deposit may be used to secure payment of &#10;77.19   all administrative and legal costs, and unpaid assessments required by section 79A.12, &#10;77.20   subdivision 2, relating to or arising from its or other employers' self-insuring. As used &#10;77.21   in this section, "private self-insurer" includes both current and former members of the &#10;77.22   self-insurers' security fund; and "private self-insurers' estimated future liability" means &#10;77.23   the private self-insurers' total of estimated future liability as determined by an Associate &#10;77.24   or Fellow of the Casualty Actuarial Society every year for group member private &#10;77.25   self-insurers and, for a nongroup member private self-insurer's authority to self-insure, &#10;77.26   every year for the first five years. After the first five years, the nongroup member's total &#10;77.27   shall be as determined by an Associate or Fellow of the Casualty Actuarial Society at least &#10;77.28   every two years, and each such actuarial study shall include a projection of future losses &#10;77.29   during the period until the next scheduled actuarial study, less payments anticipated to &#10;77.30   be made during that time.&#10;77.31   All data and information furnished by a private self-insurer to an Associate or &#10;77.32   Fellow of the Casualty Actuarial Society for purposes of determining private self-insurers' &#10;77.33   estimated future liability must be certified by an officer of the private self-insurer to be &#10;77.34   true and correct with respect to payroll and paid losses, and must be certified, upon &#10;78.1    information and belief, to be true and correct with respect to reserves. The certification &#10;78.2    must be made by sworn affidavit. In addition to any other remedies provided by law, &#10;78.3    the certification of false data or information pursuant to this subdivision may result in a &#10;78.4    fine imposed by the commissioner of commerce on the private self-insurer up to the &#10;78.5    amount of $5,000, and termination of the private self-insurers' authority to self-insure. &#10;78.6    The determination of private self-insurers' estimated future liability by an Associate or &#10;78.7    Fellow of the Casualty Actuarial Society shall be conducted in accordance with standards &#10;78.8    and principles for establishing loss and loss adjustment expense reserves by the Actuarial &#10;78.9    Standards Board, an affiliate of the American Academy of Actuaries. The commissioner &#10;78.10   may reject an actuarial report that does not meet the standards and principles of the &#10;78.11   Actuarial Standards Board, and may further disqualify the actuary who prepared the report &#10;78.12   from submitting any future actuarial reports pursuant to this chapter. Within 30 days after &#10;78.13   the actuary has been served by the commissioner with a notice of disqualification, an &#10;78.14   actuary who is aggrieved by the disqualification may request a hearing to be conducted in &#10;78.15   accordance with chapter 14. Based on a review of the actuarial report, the commissioner &#10;78.16   of commerce may require an increase in the minimum security deposit in an amount the &#10;78.17   commissioner considers sufficient.&#10;78.18   <ins>In addition, the Minnesota self-insurers' security fund may, at its sole discretion </ins>&#10;78.19   <ins>and cost, undertake an independent actuarial review or an actuarial study of a private </ins>&#10;78.20   <ins>self-insurer's estimated future liability as defined in this subdivision. The review or </ins>&#10;78.21   <ins>study must be conducted by an associate or fellow of the Casualty Actuarial Society. </ins>&#10;78.22   <ins>The actuary has the right to receive and review data and information of the self-insurer </ins>&#10;78.23   <ins>necessary for the actuary to complete its review or study. A copy of this report must be </ins>&#10;78.24   <ins>filed with the commissioner and a copy must be furnished to the self-insurer.</ins>&#10;78.25   Estimated future liability is determined by first taking the total amount of the &#10;78.26   self-insured's future liability of workers' compensation claims and then deducting the &#10;78.27   total amount which is estimated to be returned to the self-insurer from any specific &#10;78.28   excess insurance coverage, aggregate excess insurance coverage, and any supplementary &#10;78.29   benefits or second injury benefits which are estimated to be reimbursed by the special &#10;78.30   compensation fund. However, in the determination of estimated future liability, the &#10;78.31   actuary for the self-insurer shall not take a credit for any excess insurance or reinsurance &#10;78.32   which is provided by a captive insurance company which is wholly owned by the &#10;78.33   self-insurer. Supplementary benefits or second injury benefits will not be reimbursed by &#10;78.34   the special compensation fund unless the special compensation fund assessment pursuant &#10;78.35   to section 176.129 is paid and the reports required thereunder are filed with the special &#10;78.36   compensation fund. In the case of surety bonds, bonds shall secure administrative and &#10;79.1    legal costs in addition to the liability for payment of compensation reflected on the face of &#10;79.2    the bond. In no event shall the security be less than the last retention limit selected by the &#10;79.3    self-insurer with the Workers' Compensation Reinsurance Association, provided that the &#10;79.4    commissioner may allow former members to post less than the Workers' Compensation &#10;79.5    Reinsurance Association retention level if that amount is adequate to secure payment &#10;79.6    of the self-insurers' estimated future liability, as defined in this subdivision, including &#10;79.7    payment of claims, administrative and legal costs, and unpaid assessments required by &#10;79.8    section 79A.12, subdivision 2. The posting or depositing of security pursuant to this &#10;79.9    section shall release all previously posted or deposited security from any obligations under &#10;79.10   the posting or depositing and any surety bond so released shall be returned to the surety. &#10;79.11   Any other security shall be returned to the depositor or the person posting the bond.&#10;79.12   As a condition for the granting or renewing of a certificate to self-insure, the &#10;79.13   commissioner may require a private self-insurer to furnish any additional security the &#10;79.14   commissioner considers sufficient to insure payment of all claims under chapter 176.&#10;&#10;<a id="go.0.70.0"></a>79.15       Sec. 70. Minnesota Statutes 2004, section 79A.23, subdivision 3, is amended to read:&#10;79.16       Subd. 3. <b>Operational audit.</b> (a) The commissioner<del>, prior to authorizing surplus </del>&#10;79.17   <del>distribution of a commercial self-insurance group's first fund year or no later than after </del>&#10;79.18   <del>the third anniversary of the group's authority to self-insure,</del> may conduct an operational &#10;79.19   audit of the commercial self-insurance group's claim handling and reserve practices as &#10;79.20   well as its underwriting procedures to determine if they adhere to the group's business &#10;79.21   plan<ins> and sound business practices</ins>. The commissioner may select outside consultants to &#10;79.22   assist in conducting the audit. After completion of the audit, the commissioner shall either &#10;79.23   renew or revoke the commercial self-insurance group's authority to self-insure. The &#10;79.24   commissioner may also order any changes deemed necessary in the claims handling, &#10;79.25   reserving practices, or underwriting procedures of the group.&#10;79.26   (b) The cost of the operational audit shall be borne by the commercial self-insurance &#10;79.27   group.&#10;&#10;<a id="go.0.71.0"></a>79.28       Sec. 71. Minnesota Statutes 2004, section 79A.32, is amended to read:&#10;79.29   <b>79A.32 REPORTING TO </b><del><b>MINNESOTA WORKERS' COMPENSATION </b></del>&#10;79.30   <del><b>INSURERS' ASSOCIATION</b></del><ins><b> LICENSED DATA SERVICE ORGANIZATIONS</b></ins><b>.</b>&#10;79.31       <del>Subdivision 1.</del> <del><b>Required activity.</b></del> <del>Each self-insurer shall perform the following </del>&#10;79.32   <del>activities:</del>&#10;79.33   <del>(1) maintain membership in and report loss experience data to the Minnesota </del>&#10;79.34   <del>Workers' Compensation Insurers Association, or a licensed data service organization, </del>&#10;80.1    <del>in accordance with the statistical plan and rules of the organization as approved by the </del>&#10;80.2    <del>commissioner;</del>&#10;80.3    <del>(2) establish a plan for merit rating which shall be consistently applied to all </del>&#10;80.4    <del>insureds, provided that members of a data service organization may use merit rating plans </del>&#10;80.5    <del>developed by that data service organization;</del>&#10;80.6    <del>(3) provide an annual report to the commissioner containing the information and </del>&#10;80.7    <del>prepared in the form required by the commissioner; and</del>&#10;80.8    <del>(4) keep a record of the losses paid by the self-insurers and premiums for the </del>&#10;80.9    <del>group self-insurers.</del>&#10;80.10       Subd. 2. <b>Permitted activity.</b> <del>In addition to any other activities not prohibited by </del>&#10;80.11   <del>this chapter, self-insurers may</del><ins> Through data service organizations licensed under chapter </ins>&#10;80.12   <ins>79, self insurers may</ins>:&#10;80.13   (1) <del>through licensed data service organizations,</del> individually, or with self-insurers &#10;80.14   commonly owned, managed, or controlled, conduct research and collect statistics to &#10;80.15   investigate, identify, and classify information relating to causes or prevention of losses;<ins> and</ins>&#10;80.16   <ins>(2) at the request of a private self insurer or self insurer group, submit and collect </ins>&#10;80.17   <ins>data, including payroll and loss data; and perform calculations, including calculations of </ins>&#10;80.18   <ins>experience modifications of individual self-insured employers.</ins>&#10;80.19   <del>(2) develop and use classification plans and rates based upon any reasonable factors; </del>&#10;80.20   <del>and</del>&#10;80.21   <del>(3) develop rules for the assignment of risks to classifications.</del>&#10;80.22       <del>Subd. 3.</del> <del><b>Delayed reporting.</b></del> <del>Private self-insurers established under sections  </del>&#10;80.23   <del>79A.01</del><del> to  </del><del>79A.18</del><del> prior to August 1, 1995, need not begin filing the reports required </del>&#10;80.24   <del>under subdivision 1 until January 1, 1998.</del>&#10;&#10;<a id="go.0.72.0"></a>80.25       Sec. 72. Minnesota Statutes 2004, section 123A.21, subdivision 7, is amended to read:&#10;80.26       Subd. 7. <b>Educational programs and services.</b> <ins>(a) </ins>The board of directors of each &#10;80.27   SC shall submit annually a plan to the members. The plan shall identify the programs and &#10;80.28   services which are suggested for implementation by the SC during the following year and &#10;80.29   shall contain components of long-range planning determined by the SC. These programs &#10;80.30   and services may include, but are not limited to, the following areas:&#10;80.31   (1) administrative services;&#10;80.32   (2) curriculum development;&#10;80.33   (3) data processing;&#10;80.34   (4) distance learning and other telecommunication services;&#10;80.35   (5) evaluation and research;&#10;81.1    (6) staff development;&#10;81.2    (7) media and technology centers;&#10;81.3    (8) publication and dissemination of materials;&#10;81.4    (9) pupil personnel services;&#10;81.5    (10) planning;&#10;81.6    (11) secondary, postsecondary, community, adult, and adult vocational education;&#10;81.7    (12) teaching and learning services, including services for students with special &#10;81.8    talents and special needs;&#10;81.9    (13) employee personnel services;&#10;81.10   (14) vocational rehabilitation;&#10;81.11   (15) health, diagnostic, and child development services and centers;&#10;81.12   (16) leadership or direction in early childhood and family education;&#10;81.13   (17) community services;&#10;81.14   (18) shared time programs;&#10;81.15   (19) fiscal services and risk management programs<ins>, including health insurance </ins>&#10;81.16   <ins>programs providing reinsurance or stop loss coverage</ins>;&#10;81.17   (20) technology planning, training, and support services;&#10;81.18   (21) health and safety services;&#10;81.19   (22) student academic challenges; and&#10;81.20   (23) cooperative purchasing services.&#10;81.21   <ins>An SC is subject to regulation and oversight by the commissioner of commerce </ins>&#10;81.22   <ins>under the insurance laws of this state when operating a health reinsurance program </ins>&#10;81.23   <ins>pursuant to clause (19) providing reinsurance or stop loss coverage.</ins>&#10;81.24   <ins>(b) A group health, dental, or long-term disability coverage program provided by </ins>&#10;81.25   <ins>one or more service cooperatives may provide coverage to nursing homes licensed under </ins>&#10;81.26   <ins>chapter 144A and to boarding care homes licensed under sections 144.50 to 144.56 and </ins>&#10;81.27   <ins>certified for participation in the medical assistance program located in this state.</ins>&#10;81.28   <ins>(c) A group health, dental, or long-term disability coverage program provided by </ins>&#10;81.29   <ins>one or more service cooperatives:</ins>&#10;81.30   <ins>(1) must rebid contracts for insurance and third-party administration at least every </ins>&#10;81.31   <ins>four years. The contracts may be regional or statewide in the discretion of the SC; and</ins>&#10;81.32   <ins>(2) may determine premiums for its health, dental, or long-term disability coverage </ins>&#10;81.33   <ins>individually for specific employers or may determine them on a pooled or other basis </ins>&#10;81.34   <ins>established by the SC.</ins>&#10;81.35   <ins><b>EFFECTIVE DATE.</b></ins><ins>This section is effective the day following final enactment.</ins>&#10;&#10;<a id="go.0.73.0"></a>82.1        Sec. 73. Minnesota Statutes 2004, section 123A.21, is amended by adding a &#10;82.2    subdivision to read:&#10;82.3        <ins>Subd. 12.</ins> <ins><b>Health Coverage Pool Comparison Shopping.</b></ins> <ins>(a) Service cooperatives </ins>&#10;82.4    <ins>must permit school districts and other political subdivisions participating in a service </ins>&#10;82.5    <ins>cooperative health coverage pool to solicit bids and other information from competing </ins>&#10;82.6    <ins>sources of health coverage at any time other than within five months prior to the end of a </ins>&#10;82.7    <ins>master agreement.</ins>&#10;82.8    <ins>(b) A service cooperative must not impose a fine or other penalty against an enrolled </ins>&#10;82.9    <ins>entity for soliciting a bid or other information during the allowed period. The service </ins>&#10;82.10   <ins>cooperative may prohibit the entity from participating in service cooperative coverage for </ins>&#10;82.11   <ins>a period of up to one year, if the entity leaves the service cooperative pool and obtains </ins>&#10;82.12   <ins>other health coverage.</ins>&#10;82.13   <ins>(c) A service cooperative must provide each enrolled entity with the entity's monthly </ins>&#10;82.14   <ins>claims data. This paragraph applies notwithstanding section 13.203.</ins>&#10;&#10;<a id="go.0.74.0"></a>82.15       Sec. 74. Minnesota Statutes 2005 Supplement, section 256B.0571, is amended to read:&#10;82.16   <b>256B.0571 LONG-TERM CARE PARTNERSHIP</b><ins><b> PROGRAM</b></ins><b>.</b>&#10;82.17       Subdivision 1. <b>Definitions.</b> For purposes of this section, the following terms have &#10;82.18   the meanings given them.&#10;82.19       <del>Subd. 2.</del> <del><b>Home care service.</b></del> <del>"Home care service" means care described in section </del>&#10;82.20   <del>144A.43</del><del>.</del>&#10;82.21       Subd. 3. <b>Long-term care insurance.</b> "Long-term care insurance" means a policy &#10;82.22   described in section 62S.01.&#10;82.23       Subd. 4. <b>Medical assistance.</b> "Medical assistance" means the program of medical &#10;82.24   assistance established under section 256B.01.&#10;82.25       <del>Subd. 5.</del> <del><b>Nursing home.</b></del> <del>"Nursing home" means a nursing home as described </del>&#10;82.26   <del>in section </del><del>144A.01</del><del>.</del>&#10;82.27       Subd. 6. <b>Partnership policy.</b> "Partnership policy" means a long-term care insurance &#10;82.28   policy that meets the requirements under subdivision 10 <del>or 11, regardless of when the </del>&#10;82.29   <del>policy</del><ins> and</ins> was <del>first</del> issued<ins> on or after the effective date of the state plan amendment </ins>&#10;82.30   <ins>implementing the partnership program in Minnesota</ins>.&#10;82.31       Subd. 7. <b>Partnership program.</b> "Partnership program" means the Minnesota &#10;82.32   partnership for long-term care program established under this section.&#10;82.33       <ins>Subd. 7a.</ins> <ins><b>Protected assets.</b></ins> <ins>"Protected assets" means assets or proceeds of assets </ins>&#10;82.34   <ins>that are protected from recovery under subdivisions 13 and 15.</ins>&#10;83.1        Subd. 8. <b>Program established.</b> (a) The commissioner, in cooperation with the &#10;83.2    commissioner of commerce, shall establish the Minnesota partnership for long-term care &#10;83.3    program to provide for the financing of long-term care through a combination of private &#10;83.4    insurance and medical assistance.&#10;83.5    (b) An individual who meets the requirements in this paragraph is eligible to &#10;83.6    participate in the partnership program. The individual must:&#10;83.7    (1) be a Minnesota resident<ins> at the time coverage first became effective under the </ins>&#10;83.8    <ins>partnership policy</ins>;&#10;83.9    (2) <del>purchase a partnership policy that is delivered, issued for delivery, or renewed on </del>&#10;83.10   <del>or after the effective date of Laws 2005, First Special Session chapter 4, article 7, section </del>&#10;83.11   <del>5, and maintain the partnership policy in effect throughout the period of participation </del>&#10;83.12   <del>in the partnership program</del><ins> be a beneficiary of a partnership policy  that (i) is issued on </ins>&#10;83.13   <ins>or after the effective date of the state plan amendment implementing the partnership </ins>&#10;83.14   <ins>program in Minnesota, or (ii) qualifies as a partnership policy under the provisions of </ins>&#10;83.15   <ins>subdivision 8a</ins>; and&#10;83.16   (3) <del>exhaust the minimum</del> <ins>have exhausted all of the </ins>benefits under the partnership &#10;83.17   policy as described in this section. Benefits received under a long-term care insurance &#10;83.18   policy before <del>the effective date of Laws 2005, First Special Session chapter 4, article 7, </del>&#10;83.19   <del>section 5</del><ins> July 1, 2006</ins>, do not count toward the exhaustion of benefits required in this &#10;83.20   subdivision.&#10;83.21       <ins>Subd. 8a.</ins> <ins><b>Exchange for long-term care partnership policy; addition of policy </b></ins>&#10;83.22   <ins><b>rider.</b></ins> <ins>(a) If authorized by federal law or if federal approval is granted with respect to </ins>&#10;83.23   <ins>the partnership program established in this section, a long-term care insurance policy </ins>&#10;83.24   <ins>that was issued before the effective date of the state plan amendment implementing the </ins>&#10;83.25   <ins>partnership program in Minnesota that was exchanged after the effective date of the state </ins>&#10;83.26   <ins>plan amendment for a long-term care partnership policy that meets the requirements of </ins>&#10;83.27   <ins>Public Law 109-171, section 6021, qualifies as a long-term care partnership policy under </ins>&#10;83.28   <ins>this section, unless the policy is paying benefits on the date the policy is exchanged.</ins>&#10;83.29   <ins>(b) If authorized by federal law or if federal approval is granted with respect to the </ins>&#10;83.30   <ins>partnership program established in this section, a long-term care insurance policy that was </ins>&#10;83.31   <ins>issued before the effective date of the state plan amendment implementing the partnership </ins>&#10;83.32   <ins>program in Minnesota that has a rider added after the effective date of the state plan </ins>&#10;83.33   <ins>amendment that meets the requirements of Public Law 109-171, section 6021, qualifies </ins>&#10;83.34   <ins>as a long-term care partnership policy under this section, unless the policy is paying </ins>&#10;83.35   <ins>benefits on the date the rider is added.</ins>&#10;84.1        Subd. 9. <b>Medical assistance eligibility.</b> (a) Upon application <del>of</del> <ins>for medical </ins>&#10;84.2    <ins>assistance program payment of long-term care services by </ins>an individual who meets the &#10;84.3    requirements described in subdivision 8, the commissioner shall determine the individual's &#10;84.4    eligibility for medical assistance according to paragraphs (b) <del>and (c)</del><ins> to (i)</ins>.&#10;84.5    (b) After <del>disregarding financial</del> <ins>determining </ins>assets <del>exempted under medical </del>&#10;84.6    <del>assistance eligibility requirements</del><ins> subject to the asset limit under section 256B.056, </ins>&#10;84.7    <ins>subdivision 3 or 3c, or 256B.057, subdivision 9 or 10</ins>, the commissioner shall <del>disregard an </del>&#10;84.8    <del>additional amount of financial assets equal</del> <ins>allow the individual to designate assets to be </ins>&#10;84.9    <ins>protected from recovery under subdivisions 13 and 15 up </ins>to the dollar amount of <del>coverage</del> &#10;84.10   <ins>the benefits </ins>utilized under the partnership policy.<ins> Designated assets shall be disregarded </ins>&#10;84.11   <ins>for purposes of determining eligibility for payment of long-term care services.</ins>&#10;84.12   (c) <del>The commissioner shall consider the individual's income according to medical </del>&#10;84.13   <del>assistance eligibility requirements.</del><ins> The individual shall identify the designated assets and </ins>&#10;84.14   <ins>the full fair market value of those assets and designate them as assets to be protected at </ins>&#10;84.15   <ins>the time of initial application for medical assistance. The full fair market value of real </ins>&#10;84.16   <ins>property or interests in real property shall be based on the most recent full assessed value </ins>&#10;84.17   <ins>for property tax purposes for the real property, unless the individual provides a complete </ins>&#10;84.18   <ins>professional appraisal by a licensed appraiser to establish the full fair market value. The </ins>&#10;84.19   <ins>extent of a life estate in real property shall be determined using the life estate table in the </ins>&#10;84.20   <ins>health care program's manual. Ownership of any asset in joint tenancy shall be treated as </ins>&#10;84.21   <ins>ownership as tenants in common for purposes of its designation as a disregarded asset. </ins>&#10;84.22   <ins>The unprotected value of any protected asset is subject to estate recovery according to </ins>&#10;84.23   <ins>subdivisions 13 and 15.</ins>&#10;84.24   <ins>(d) The right to designate assets to be protected is personal to the individual and </ins>&#10;84.25   <ins>ends when the individual dies, except as otherwise provided in subdivisions 13 and </ins>&#10;84.26   <ins>15. It does not include the increase in the value of the protected asset and the income, </ins>&#10;84.27   <ins>dividends, or profits from the asset. It may be exercised by the individual or by anyone </ins>&#10;84.28   <ins>with the legal authority to do so on the individual's behalf. It shall not be sold, assigned, </ins>&#10;84.29   <ins>transferred, or given away.</ins>&#10;84.30   <ins>(e) If the dollar amount of the benefits utilized under a partnership policy is greater </ins>&#10;84.31   <ins>than the full fair market value of all assets protected at the time of the application for </ins>&#10;84.32   <ins>medical assistance long-term care services, the individual may designate additional assets </ins>&#10;84.33   <ins>that become available during the individual's lifetime for protection under this section. </ins>&#10;84.34   <ins>The individual must make the designation in writing to the county agency no later than </ins>&#10;84.35   <ins>the last date on which the individual must report a change in circumstances to the county </ins>&#10;84.36   <ins>agency, as provided for under the medical assistance program. Any excess used for this </ins>&#10;85.1    <ins>purpose shall not be available to the individual's estate to protect assets in the estate from </ins>&#10;85.2    <ins>recovery under section 256B.15 or 524.3-1202, or otherwise.</ins>&#10;85.3    <ins>(f) This section applies only to estate recovery under United States Code, title 42, </ins>&#10;85.4    <ins>section 1396p, subsections (a) and (b), and does not apply to recovery authorized by other </ins>&#10;85.5    <ins>provisions of federal law, including, but not limited to, recovery from trusts under United </ins>&#10;85.6    <ins>States Code, title 42, section 1396p, subsection (d)(4)(A) and (C), or to recovery from </ins>&#10;85.7    <ins>annuities, or similar legal instruments, subject to section 6012, subsections (a) and (b), of </ins>&#10;85.8    <ins>the Deficit Reduction Act of 2005, Public Law 109-171.</ins>&#10;85.9    <ins>(g) An individual's protected assets owned by the individual's spouse who applies </ins>&#10;85.10   <ins>for payment of medical assistance long-term care services shall not be protected assets or </ins>&#10;85.11   <ins>disregarded for purposes of eligibility of the individual's spouse solely because they were </ins>&#10;85.12   <ins>protected assets of the individual.</ins>&#10;85.13   <ins>(h) Assets designated under this subdivision shall not be subject to penalty under </ins>&#10;85.14   <ins>section 256B.0595.</ins>&#10;85.15   <ins>(i) The commissioner shall otherwise determine the individual's eligibility </ins>&#10;85.16   <ins>for payment of long-term care services according to medical assistance eligibility </ins>&#10;85.17   <ins>requirements.</ins>&#10;85.18       Subd. 10. <del><b>Dollar-for-dollar asset protection policies</b></del><b> </b><ins><b>Long-term care partnership </b></ins>&#10;85.19   <ins><b>policy inflation protection</b></ins><b>.</b> <del>(a) A dollar-for-dollar asset protection policy must meet all </del>&#10;85.20   <del>of the requirements in paragraphs (b) to (e).</del>&#10;85.21   <del>(b) The policy must satisfy the requirements of chapter 62S.</del>&#10;85.22   <del>(c) The policy must offer an elimination period of not more than 180 days for an </del>&#10;85.23   <del>adjusted premium.</del>&#10;85.24   <del>(d) The policy must satisfy the requirements established by the commissioner of </del>&#10;85.25   <del>human services under subdivision 14.</del>&#10;85.26   <del>(e) Minimum daily benefits shall be $130 for nursing home care or $65 for home </del>&#10;85.27   <del>care, with inflation protection provided in the policy as described in section </del><del>62S.23, </del>&#10;85.28   <del>subdivision 1</del><del>, clause (1). These minimum daily benefit amounts shall be adjusted by the </del>&#10;85.29   <del>commissioner on October 1 of each year by a percentage equal to the inflation protection </del>&#10;85.30   <del>feature described in section </del><del>62S.23, subdivision 1</del><del>, clause (1), for purposes of setting </del>&#10;85.31   <del>minimum requirements that a policy must meet in future years in order to initially qualify </del>&#10;85.32   <del>as an approved policy under this subdivision. Adjusted minimum daily benefit amounts </del>&#10;85.33   <del>shall be rounded to the nearest whole dollar.</del> <ins>A long-term care partnership policy must </ins>&#10;85.34   <ins>provide the inflation protection described in this subdivision. If the policy is sold to an </ins>&#10;85.35   <ins>individual who:</ins>&#10;86.1    <ins>(1) has not attained age 61 as of the date of purchase, the policy must provide </ins>&#10;86.2    <ins>compound annual inflation protection;</ins>&#10;86.3    <ins>(2) has attained age 61, but has not attained age 76 as of such date, the policy must </ins>&#10;86.4    <ins>provide some level of inflation protection; and</ins>&#10;86.5    <ins>(3) has attained age 76 as of such date, the policy may, but is not required to, provide </ins>&#10;86.6    <ins>some level of inflation protection.</ins>&#10;86.7        <del>Subd. 11.</del> <del><b>Total asset protection policies.</b></del> <del>(a) A total asset protection policy must </del>&#10;86.8    <del>meet all of the requirements in subdivision 10, paragraphs (b) to (d), and this subdivision.</del>&#10;86.9    <del>(b) Minimum coverage shall be for a period of not less than three years and for a </del>&#10;86.10   <del>dollar amount equal to 36 months of nursing home care at the minimum daily benefit rate </del>&#10;86.11   <del>determined and adjusted under paragraph (c).</del>&#10;86.12   <del>(c) Minimum daily benefits shall be $150 for nursing home care or $75 for home </del>&#10;86.13   <del>care, with inflation protection provided in the policy as described in section </del><del>62S.23, </del>&#10;86.14   <del>subdivision 1</del><del>, clause (1). These minimum daily benefit amounts shall also be adjusted </del>&#10;86.15   <del>by the commissioner on October 1 of each year by a percentage equal to the inflation </del>&#10;86.16   <del>protection feature described in section </del><del>62S.23, subdivision 1</del><del>, clause (1), for purposes of </del>&#10;86.17   <del>setting minimum requirements that a policy must meet in future years in order to initially </del>&#10;86.18   <del>qualify as an approved policy under this subdivision. Adjusted minimum daily benefit </del>&#10;86.19   <del>amounts shall be rounded to the nearest whole dollar.</del>&#10;86.20   <del>(d) The policy must cover all of the following services:</del>&#10;86.21   <del>(1) nursing home stay;</del>&#10;86.22   <del>(2) home care service; and</del>&#10;86.23   <del>(3) care management.</del>&#10;86.24       Subd. 12. <b>Compliance with federal law.</b> An issuer of a partnership policy must &#10;86.25   comply with <del>any federal law authorizing partnership policies in Minnesota</del><ins> Public Law </ins>&#10;86.26   <ins>109-171, section 6021</ins>, including any federal regulations, as amended, adopted under that &#10;86.27   law. <del>This subdivision does not require compliance with any provision of this federal </del>&#10;86.28   <del>law until the date upon which the law requires compliance with the provision. The </del>&#10;86.29   <del>commissioner has authority to enforce this subdivision.</del>&#10;86.30       Subd. 13. <b>Limitations on estate recovery.</b> (a) <del>For an individual who exhausts the </del>&#10;86.31   <del>minimum benefits of a</del> <del>dollar-for-dollar asset protection</del> <del>policy under subdivision 10, and </del>&#10;86.32   <del>is determined eligible for medical assistance under subdivision 9, the state shall limit </del>&#10;86.33   <del>recovery under the provisions of section </del><del>256B.15</del><del> against the estate of the individual or </del>&#10;86.34   <del>individual's spouse for medical assistance benefits received by that individual to an amount </del>&#10;86.35   <del>that exceeds the dollar amount of coverage utilized under the partnership policy.</del><ins> Protected </ins>&#10;86.36   <ins>assets of the individual shall not be subject to recovery under section 256B.15 or section </ins>&#10;87.1    <ins>524.3-1201 for medical assistance or alternative care paid on behalf of the individual. </ins>&#10;87.2    <ins>Protected assets of the individual in the estate of the individual's surviving spouse shall </ins>&#10;87.3    <ins>not be liable to pay a claim for recovery of medical assistance paid for the predeceased </ins>&#10;87.4    <ins>individual that is filed in the estate of the surviving spouse under section 256B.15. </ins>&#10;87.5    <ins>Protected assets of the individual shall not be protected assets in the surviving spouse's </ins>&#10;87.6    <ins>estate by reason of the preceding sentence and shall be subject to recovery under section </ins>&#10;87.7    <ins>256B.15 or 524.3-1201 for medical assistance paid on behalf of the surviving spouse.</ins>&#10;87.8    (b) <del>For an individual who exhausts the minimum benefits of a total asset protection </del>&#10;87.9    <del>policy under subdivision 11, and is determined eligible for medical assistance under </del>&#10;87.10   <del>subdivision 9, the state shall not seek recovery under the provisions of section </del><del>256B.15</del><del> </del>&#10;87.11   <del>against the estate of the individual or individual's spouse for medical assistance benefits </del>&#10;87.12   <del>received by that individual.</del><ins> The personal representative may protect the full fair market </ins>&#10;87.13   <ins>value of an individual's unprotected assets in the individual's estate in an amount equal </ins>&#10;87.14   <ins>to the unused amount of asset protection the individual had on the date of death. The </ins>&#10;87.15   <ins>personal representative shall apply the asset protection so that the full fair market value of </ins>&#10;87.16   <ins>any unprotected asset in the estate is protected. When or if the asset protection available </ins>&#10;87.17   <ins>to the personal representative is or becomes less than the full fair market value of any </ins>&#10;87.18   <ins>remaining unprotected asset, it shall be applied to partially protect one unprotected asset.</ins>&#10;87.19   <ins>(c) The asset protection described in paragraph (a) terminates with respect to an asset </ins>&#10;87.20   <ins>includable in the individual's estate under chapter 524 or section 256B.15:</ins>&#10;87.21   <ins>(1) when the estate distributes the asset; or</ins>&#10;87.22   <ins>(2) if the estate of the individual has not been probated within one year from the </ins>&#10;87.23   <ins>date of death.</ins>&#10;87.24   <ins>(d) If an individual owns a protected asset on the date of death and the estate is </ins>&#10;87.25   <ins>opened for probate more than one year after death, the state or a county agency may file </ins>&#10;87.26   <ins>and collect claims in the estate under section 256B.15, and no statute of limitations in </ins>&#10;87.27   <ins>chapter 524 that would otherwise limit or bar the claim shall apply.</ins>&#10;87.28   <ins>(e) Except as otherwise provided, nothing in this section shall limit or prevent </ins>&#10;87.29   <ins>recovery of medical assistance.</ins>&#10;87.30       Subd. 14. <b>Implementation.</b> <del>(a) If federal law is amended or a federal waiver is </del>&#10;87.31   <del>granted to permit implementation of this section, the commissioner, in consultation with </del>&#10;87.32   <del>the commissioner of commerce, may alter the requirements of subdivisions 10 and 11, </del>&#10;87.33   <del>and may establish additional requirements for approved policies in order to conform with </del>&#10;87.34   <del>federal law or waiver authority. In establishing these requirements, the commissioner shall </del>&#10;87.35   <del>seek to maximize purchase of qualifying policies by Minnesota residents while controlling </del>&#10;87.36   <del>medical assistance costs.</del>&#10;88.1    <del>(b) The commissioner is authorized to suspend implementation of this section </del>&#10;88.2    <del>until the next session of the legislature if the commissioner, in consultation with the </del>&#10;88.3    <del>commissioner of commerce, determines that the federal legislation or federal waiver </del>&#10;88.4    <del>authorizing a partnership program in Minnesota is likely to impose substantial unforeseen </del>&#10;88.5    <del>costs on the state budget.</del>&#10;88.6    <del>(c) The commissioner must take action under paragraph (a) or (b) within 45 days of </del>&#10;88.7    <del>final federal action authorizing a partnership policy in Minnesota.</del>&#10;88.8    <del>(d) The commissioner must notify the appropriate legislative committees of </del>&#10;88.9    <del>action taken under this subdivision within 50 days of final federal action authorizing a </del>&#10;88.10   <del>partnership policy in Minnesota.</del>&#10;88.11   <del>(e) The commissioner must publish a notice in the State Register of implementation </del>&#10;88.12   <del>decisions made under this subdivision as soon as practicable.</del>&#10;88.13   <ins>(a) The commissioner, in cooperation with the commissioner of commerce, may alter </ins>&#10;88.14   <ins>the requirements of this section so as to be in compliance with forthcoming requirements </ins>&#10;88.15   <ins>of the Department of Health and Human Services and the National Association of </ins>&#10;88.16   <ins>Insurance Commissioners necessary to implement the long-term care partnership program </ins>&#10;88.17   <ins>requirements of Public Law 109-171, section 6021.</ins>&#10;88.18   <ins>(b) The commissioner shall submit a state plan amendment to the federal government </ins>&#10;88.19   <ins>to implement the long-term care partnership program in accordance with this section.</ins>&#10;88.20       <ins>Subd. 15.</ins> <ins><b>Limitation on liens.</b></ins> <ins>(a) An individual's interest in real property shall </ins>&#10;88.21   <ins>not be subject to a medical assistance lien or a notice of potential claim while and to the </ins>&#10;88.22   <ins>extent it is protected under subdivision 9.</ins>&#10;88.23   <ins>(b) Medical assistance liens or liens arising under notices of potential claims against </ins>&#10;88.24   <ins>an individual's interests in real property in the individual's estate that are designated as </ins>&#10;88.25   <ins>protected under subdivision 13, paragraph (b), shall be released to the extent of the dollar </ins>&#10;88.26   <ins>value of the protection applied to the interest.</ins>&#10;88.27   <ins>(c) If an interest in real property is protected from a lien for recovery of medical </ins>&#10;88.28   <ins>assistance paid on behalf of the individual under paragraph (a) or (b), no lien for recovery </ins>&#10;88.29   <ins>of medical assistance paid on behalf of that individual shall be filed against the protected </ins>&#10;88.30   <ins>interest in real property after it is distributed to the individual's heirs or devisees.</ins>&#10;88.31       <ins>Subd. 16.</ins> <ins><b>Burden of proof.</b></ins> <ins>Any individual or the personal representative of the </ins>&#10;88.32   <ins>individual's estate who asserts that an asset is a disregarded or protected asset under </ins>&#10;88.33   <ins>this section in connection with any determination of eligibility for benefits under the </ins>&#10;88.34   <ins>medical assistance program or any appeal, case, controversy, or other proceedings, shall </ins>&#10;88.35   <ins>have the initial burden of:</ins>&#10;89.1    <ins>(1) documenting and proving by clear and convincing evidence that the asset or </ins>&#10;89.2    <ins>source of funds for the asset in question was designated as disregarded or protected;</ins>&#10;89.3    <ins>(2) tracing the asset and the proceeds of the asset from that time forward; and </ins>&#10;89.4    <ins>(3) documenting that the asset or proceeds of the asset remained disregarded or </ins>&#10;89.5    <ins>protected at all relevant times.</ins>&#10;89.6    <ins><b>EFFECTIVE DATE.</b></ins><ins>This section is effective July 1, 2006.</ins>&#10;&#10;<a id="go.0.75.0"></a>89.7        Sec. 75. Laws 2005, First Special Session chapter 4, article 7, section 59, is amended &#10;89.8    to read:&#10;89.9    Sec. 59.  REPORT TO LEGISLATURE.  &#10;89.10   The commissioner shall report to the legislature by  December 15, 2006, on the &#10;89.11   redesign of case management services.  In preparing the report, the commissioner &#10;89.12   shall consult with  representatives for consumers, consumer advocates, counties, <ins>labor </ins>&#10;89.13   <ins>organizations representing county social service workers, </ins>and  service providers.  The &#10;89.14   report shall include draft legislation  for case management changes that will:  &#10;89.15   (1) streamline administration;  &#10;89.16   (2) improve consumer access to case management services;  &#10;89.17   (3) address the use of a comprehensive universal assessment  protocol for persons &#10;89.18   seeking community supports;  &#10;89.19   (4) establish case management performance measures;  &#10;89.20   (5) provide for consumer choice of the case management  service vendor; and  &#10;89.21   (6) provide a method of payment for case management  services that is cost-effective &#10;89.22   and best supports the draft  legislation in clauses (1) to (5).&#10;&#10;<a id="go.0.76.0"></a>89.23       Sec. 76. <ins><b>MEDICAL MALPRACTICE INSURANCE REPORT.</b></ins>&#10;89.24   <ins>(a) The commissioner of commerce shall provide to the legislature annually a brief </ins>&#10;89.25   <ins>written report on the status of the market for medical malpractice insurance in Minnesota. </ins>&#10;89.26   <ins>The report must summarize, interpret, explain, and analyze information on that subject </ins>&#10;89.27   <ins>available to the commissioner, through annual statements filed by insurance companies, </ins>&#10;89.28   <ins>information obtained under paragraph (c), and other sources. </ins>&#10;89.29   <ins>(b) The annual report must consider, to the extent possible, using definitions </ins>&#10;89.30   <ins>developed by the commissioner, Minnesota-specific data on market shares; premiums </ins>&#10;89.31   <ins>received; amounts paid to settle claims that were not litigated, claims that were settled </ins>&#10;89.32   <ins>after litigation began, and claims that were litigated to court judgment; amounts spent </ins>&#10;89.33   <ins>on processing, investigation, litigation, and otherwise handling claims; other sales and </ins>&#10;89.34   <ins>administrative costs; and the loss ratios of the insurers. </ins>&#10;90.1    <ins>(c) Each insurance company that provides medical malpractice insurance in this state </ins>&#10;90.2    <ins>shall, no later than June 1 each year, file with the commissioner of commerce, on a form </ins>&#10;90.3    <ins>prescribed by the commissioner and using definitions developed by the commissioner, </ins>&#10;90.4    <ins>the Minnesota-specific data referenced in paragraph (b), other than market share, for the </ins>&#10;90.5    <ins>previous calendar year for that insurance company, shown separately for various categories </ins>&#10;90.6    <ins>of coverages including, if possible, hospitals, medical clinics, nursing homes, physicians </ins>&#10;90.7    <ins>who provide emergency medical care, obstetrician gynecologists, and ambulance services. </ins>&#10;90.8    <ins>An insurance company need not comply with this paragraph if its direct premium written </ins>&#10;90.9    <ins>in the state for the previous calendar year is less than $2,000,000.</ins>&#10;&#10;<a id="go.0.77.0"></a>90.10       Sec. 77. <ins><b> REPEALER.</b></ins>&#10;90.11   <ins>(a)</ins><ins> Minnesota Statutes 2005 Supplement, section 62Q.251,</ins><ins> is repealed, effective the </ins>&#10;90.12   <ins>day following final enactment.</ins>&#10;90.13   <ins>(b)</ins><ins> Minnesota Rules, parts 2781.0100; 2781.0200; 2781.0300; 2781.0400; </ins>&#10;90.14   <ins>2781.0500; and 2781.0600,</ins><ins> are repealed, effective July 1, 2006.</ins>&#10;