SF 4837

1st Engrossment - 93rd Legislature (2023 - 2024) Posted on 04/12/2024 09:49am

A bill for an act
relating to health carriers; providing for oversight of health maintenance
organization transactions by the commissioner of health; requiring notice to the
attorney general of certain transactions by health maintenance organizations and
nonprofit health service plan corporations; amending Minnesota Statutes 2022,
section 317A.811, subdivisions 1, 2, 4; proposing coding for new law in Minnesota
Statutes, chapter 62D.

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

Section 1.

new text begin [62D.085] TRANSACTION OVERSIGHT.
new text end

new text begin Subdivision 1. new text end

new text begin Insurance provisions applicable to health maintenance
organizations. new text end

new text begin (a) Health maintenance organizations are subject to sections 60A.135,
60A.136, 60A.137, 60A.16, 60A.161, 60D.17, 60D.18, and 60D.20 and must comply with
the provisions of these sections applicable to insurers. For purposes of applying these sections
to health maintenance organizations, "commissioner" means the commissioner of health.
new text end

new text begin (b) Health maintenance organizations are subject to all regulations implementing sections
60D.17, 60D.18, and 60D.20 in Minnesota Rules, chapter 2720, and must comply with the
provisions of these sections applicable to insurers, unless the commissioner of health adopts
rules to implement this subdivision.
new text end

new text begin Subd. 2. new text end

new text begin Notice on transfers. new text end

new text begin No person may acquire all or substantially all of the assets
of a domestic nonprofit health maintenance organization through any means unless, at the
time the agreement is entered into, the person has filed with the commissioner and has sent
to the health maintenance organization a statement containing the information required by
section 60D.17, including its implementing regulations, and the agreement and acquisition
have been approved by the commissioner of health in the manner prescribed for regulatory
approval in section 60D.17. The acquisition of assets subject to this subdivision must be
treated as an acquisition of control for purposes of applying section 60D.17 and its
implementing regulations to this subdivision.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day following final enactment.
new text end

Sec. 2.

Minnesota Statutes 2022, section 317A.811, subdivision 1, is amended to read:

Subdivision 1.

When required.

(a) Except as provided in subdivision 6, the following
corporations shall notify the attorney general of their intent to dissolve, merge, consolidate,
or convert, or to transfer all or substantially all of their assets:

(1) a corporation that holds assets for a charitable purpose as defined in section 501B.35,
subdivision 2; or

(2) a corporation that is exempt under section 501(c)(3) of the Internal Revenue Code
of 1986, or any successor section.

new text begin (b) Except as provided in subdivision 6, the following corporations shall notify the
attorney general of their intent to dissolve, merge, consolidate, convert, or transfer at least
ten percent of their assets:
new text end

new text begin (1) a corporation that is a nonprofit health service plan corporation operating under
chapter 62C; or
new text end

new text begin (2) a corporation that is a health maintenance organization operating under chapter 62D.
new text end

deleted text begin (b) deleted text end new text begin (c) new text end The notice must include:

(1) the purpose of the corporation that is giving the notice;

(2) a list of assets owned or held by the corporation for charitable purposes;

(3) a description of restricted assets and purposes for which the assets were received;

(4) a description of debts, obligations, and liabilities of the corporation;

(5) a description of tangible assets being converted to cash and the manner in which
they will be sold;

(6) anticipated expenses of the transaction, including attorney fees;

(7) a list of persons to whom assets will be transferred, if known, or the name of the
converted organization;

(8) the purposes of persons receiving the assets or of the converted organization; and

(9) the terms, conditions, or restrictions, if any, to be imposed on the transferred or
converted assets.

The notice must be signed on behalf of the corporation by an authorized person.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day following final enactment.
new text end

Sec. 3.

Minnesota Statutes 2022, section 317A.811, subdivision 2, is amended to read:

Subd. 2.

Restriction on transfers.

new text begin (a) new text end Subject to subdivision 3, a corporation described
in subdivision 1 new text begin , paragraph (a), new text end may not transfer or convey assets as part of a dissolution,
merger, consolidation, or transfer of assets under section 317A.661, and it may not convert
until 45 days after it has given written notice to the attorney general, unless the attorney
general waives all or part of the waiting period.

new text begin (b) Subject to subdivision 3, a corporation described in subdivision 1, paragraph (b),
may not transfer or convey assets as part of a dissolution, merger, consolidation, transfer
of assets under section 317A.661, or transfer of at least ten percent of its assets and it may
not convert until 45 days after it has given written notice to the attorney general, unless the
attorney general waives all or part of the waiting period.
new text end

new text begin (c) For a notice given by a corporation described in subdivision 1, paragraph (b), the
attorney general may hold a public hearing with respect to the purpose for which the
corporation gave the notice. Such a hearing must be held within 30 days after the notice is
given to the attorney general. The attorney general must give at least seven days' notice of
the hearing to the corporation filing the statement and to the public. The attorney general
may not waive all or part of the waiting period until the public hearing is held.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day following final enactment.
new text end

Sec. 4.

Minnesota Statutes 2022, section 317A.811, subdivision 4, is amended to read:

Subd. 4.

Notice after transfer.

When all or substantially all of the assets of a corporation
described in subdivision 1 new text begin , paragraph (a), or at least ten percent of the assets of a corporation
described in subdivision 1, paragraph (b), new text end have been transferred or conveyed following
expiration or waiver of the waiting period, the board shall deliver to the attorney general a
list of persons to whom the assets were transferred or conveyed. The list must include the
addresses of each person who received assets and show what assets the person received.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day following final enactment.
new text end