Minnesota Legislature
SF 915
3rd Engrossment - 86th Legislature (2009 - 2010) Posted on 05/07/2010 03:24pm
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A bill for an act
relating to insurance; requiring school districts to obtain employee health
coverage through the public employees insurance program; imposing a gross
premiums tax on the program; imposing an enrollment fee; amending Minnesota
Statutes 2008, sections 43A.316, subdivisions 9, 10, by adding subdivisions;
62E.02, subdivision 23; 62E.10, subdivision 1; 62E.11, subdivision 5; 297I.05,
by adding a subdivision; 297I.15, subdivision 3.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:
Section 1.
Minnesota Statutes 2008, section 43A.316, is amended by adding a
subdivision to read:
new text begin Subd. 3a. new text end
new text begin Health improvement programs. new text end
new text begin
The commissioner, with the approval
of the school employee insurance committee, is authorized to plan, develop, purchase,
administer, and evaluate disease management and other programs, strategies, and
incentives to improve the health and health outcomes of members.
new text end
Sec. 2.
Minnesota Statutes 2008, section 43A.316, subdivision 9, is amended to read:
Subd. 9.
Insurance trust fund.
new text begin (a) new text end The insurance trust fund in the state treasury
consists of deposits of the premiums received from employers participating in the
program and transfers before July 1, 1994, from the excess contributions holding account
established by section 353.65, subdivision 7. All money in the fund is appropriated to
the commissioner to pay insurance premiums, approved claims, refunds, administrative
costs, and other related deleted text begin servicedeleted text end costsnew text begin , including costs incurred under chapters 62E and
297I in connection with the school employee insurance programnew text end . Premiums paid by
employers to the fund are exempt from the taxes imposed by chapter 297Inew text begin , except as
described in paragraph (b)new text end . The commissioner shall reserve an amount of money to cover
the estimated costs of claims incurred but unpaid. The State Board of Investment shall
invest the money according to section 11A.24. Investment income and losses attributable
to the fund must be credited to the fund.
new text begin
(b) Notwithstanding paragraph (a), premium revenues collected from the school
employee insurance program, described in subdivisions 12 and 13, are not exempt from
the taxes imposed under section 297I.05, subdivision 15.
new text end
Sec. 3.
Minnesota Statutes 2008, section 43A.316, subdivision 10, is amended to read:
Subd. 10.
Exemption.
new text begin (a) new text end The public employee insurance program and, where
applicable, the employers participating in it are exempt from chapters 60A, 62A, 62C,
62D, 62E, and 62H, section 471.617, subdivisions 2 and 3, and the bidding requirements
of section 471.6161.
new text begin
(b) Notwithstanding paragraph (a), the school employee insurance program,
described in subdivisions 12 and 13, is a contributing member of the Minnesota
Comprehensive Health Association and must pay assessments made by the association on
the premium revenue attributed to the school employee insurance program, prorated as
provided in section 62E.11, subdivision 5, paragraph (b).
new text end
Sec. 4.
Minnesota Statutes 2008, section 43A.316, is amended by adding a subdivision
to read:
new text begin Subd. 11. new text end
new text begin Definitions. new text end
new text begin
(a) For purposes of subdivisions 11 to 16, the terms defined
in this subdivision have the meanings given.
new text end
new text begin
(b) "Eligible employee" means an employee of a school employer, a dependent of
such an employee, a retiree, or other person, who is eligible for health insurance coverage
under the school employer's plan.
new text end
new text begin
(c) "School Employee Insurance Committee" means the committee created in
subdivision 14.
new text end
new text begin
(d) "School employer" means a school district as defined in section 120A.05, service
cooperative as defined in section 123A.21, intermediate district as defined in section
136D.01, Cooperative Center for Vocational Education as defined in section 123A.22,
regional management information center as defined in section 123A.23, or an education
unit organized under a joint powers agreement under section 471.59.
new text end
Sec. 5.
Minnesota Statutes 2008, section 43A.316, is amended by adding a subdivision
to read:
new text begin Subd. 12. new text end
new text begin School employee insurance program. new text end
new text begin
The commissioner shall develop
and administer within the public employees insurance program a separately rated and
administered program for eligible employees of school employers, to be called the
school employee insurance program. The initial offerings shall be the PEIP Advantage,
Advantage Value, and Advantage HSA plans offered by the public employee insurance
program. Health coverage offered through the school employee insurance program shall
be made available beginning January 1, 2012.
new text end
Sec. 6.
Minnesota Statutes 2008, section 43A.316, is amended by adding a subdivision
to read:
new text begin Subd. 13. new text end
new text begin Enrollment; school employee insurance program. new text end
new text begin
(a) A school
employer that provides health coverage to eligible employees or contributes money to pay
for all or part of the cost of health coverage for eligible employees, must purchase such
coverage through the school employee insurance program under subdivision 12. School
employers described in paragraph (b) may opt out as described in paragraphs (b) to (e).
new text end
new text begin
(b) The school board of a school employer and each exclusive representative of
employees of a school employer which, on July 1, 2010, was individually self-insured
shall jointly determine whether the employees the exclusive representative represents will
opt out of the school employee insurance program, in the same manner described in
subdivision 5, paragraph (b). Paragraphs (c), (d), and (e) below apply only to school
employees of the school employers described in this paragraph.
new text end
new text begin
(c) School employees not represented by an exclusive representative may enter
the school employee insurance program in the same manner described in subdivision 5,
paragraph (c).
new text end
new text begin
(d) School employees who do not enter the program upon first becoming eligible
for participation are ineligible to participate for four years and must be pooled and rated
separately from the other enrollees in the school employee insurance program for the
first four years after entering the program. This paragraph does not apply to a school
employee upon later becoming a member of a school employee group that has not
declined participation.
new text end
new text begin
(e) The decision of a school board of a school employer and an exclusive
representative of school employees or, in the case of unorganized employees, the decision
of the school board of a school employer, to not opt-out of entry into the school employee
insurance program is irrevocable and applies to all future years.
new text end
Sec. 7.
Minnesota Statutes 2008, section 43A.316, is amended by adding a subdivision
to read:
new text begin Subd. 14. new text end
new text begin School Employee Insurance Committee. new text end
new text begin
(a) Notwithstanding any other
provision of law, all plan design decisions, including all pilot or demonstration programs
in which school employees participate, must first be developed by the School Employee
Insurance Committee in consultation with the commissioner or the commissioner's
designee and other consultants as the committee sees fit. This paragraph does not apply to
the initial offerings specified in subdivision 12.
new text end
new text begin
(b) The committee must be composed of 14 members who represent school
district employees and employers in equal number. The employee representatives shall
be appointed as follows: four shall be appointed by Education Minnesota, one shall be
appointed by the Service Employees International Union, one shall be appointed by the
American Federation of State, County, and Municipal Employees, and one shall be
appointed by the Minnesota School Employees Association. The seven school employer
representatives who serve on the School Employee Insurance Committee must be
appointed by the Minnesota School Boards Association, and geographic representation
must be taken into consideration when making the appointments. Members of the
committee shall serve at the will of the appointing organization. The committee will
select a chair from its membership.
new text end
new text begin
(c) The School Employee Insurance Committee members are eligible for
compensation and expense reimbursement under section 15.0575, subdivision 3. In
addition, if actual salary is lost by a committee member, or if a cost is charged by an
employer of a committee member for time missed while performing the duties of a
committee member, then the commissioner shall reimburse the member for the lost salary
or the cost from funds appropriated for the operations of the committee.
new text end
new text begin
(d) The commissioner shall provide the necessary meeting space and staff support
for the committee.
new text end
Sec. 8.
Minnesota Statutes 2008, section 43A.316, is amended by adding a subdivision
to read:
new text begin Subd. 15. new text end
new text begin Reinsurance. new text end
new text begin
The commissioner shall, on behalf of the program,
participate in an insured or self-insured reinsurance pool for the first three years of the
program and may continue to participate in a reinsurance pool after the first three years.
new text end
Sec. 9.
Minnesota Statutes 2008, section 43A.316, is amended by adding a subdivision
to read:
new text begin Subd. 16. new text end
new text begin Nonidentifiable aggregate claims data from past coverage. new text end
new text begin
Upon
request by the commissioner, entities that are providing or have provided coverage to
eligible employees of school employers within two years before the effective date of
this section, shall provide to the commissioner at no charge nonidentifiable aggregate
claims data for that coverage. The information must include data relating to employee
group benefit sets, demographics, and claims experience. Notwithstanding section 13.203,
Minnesota service cooperatives must comply with this subdivision.
new text end
Sec. 10.
Minnesota Statutes 2008, section 62E.02, subdivision 23, is amended to read:
Subd. 23.
Contributing member.
"Contributing member" means those companies
regulated under chapter 62A and offering, selling, issuing, or renewing policies or
contracts of accident and health insurance; health maintenance organizations regulated
under chapter 62D; nonprofit health service plan corporations regulated under chapter
62C; community integrated service networks regulated under chapter 62N; fraternal
benefit societies regulated under chapter 64B; the Minnesota employees insurance
program established in section 43A.317, effective July 1, 1993; deleted text begin anddeleted text end joint self-insurance
plans regulated under chapter 62Hnew text begin ; and the school employee insurance program created
under section 43A.316new text end . For the purposes of determining liability of contributing members
pursuant to section 62E.11 payments received from or on behalf of Minnesota residents
for coverage by a health maintenance organization deleted text begin ordeleted text end new text begin , anew text end community integrated service
networknew text begin , or the school employee insurance programnew text end shall be considered to be accident
and health insurance premiums.
Sec. 11.
Minnesota Statutes 2008, section 62E.10, subdivision 1, is amended to read:
Subdivision 1.
Creation new text begin and membershipnew text end ; tax exemption.
new text begin (a)new text end There is established
a Comprehensive Health Association to promote the public health and welfare of the state
of Minnesota with membership consisting of all insurers; self-insurers; fraternals; joint
self-insurance plans regulated under chapter 62H; the Minnesota employees insurance
program established in section 43A.317, effective July 1, 1993;new text begin the school employee
insurance program created under section 43A.316, subdivision 12;new text end health maintenance
organizations; and community integrated service networks licensed or authorized to do
business in this state.
new text begin (b) new text end The Comprehensive Health Association is exempt from the taxes imposed under
chapter 297I and any other laws of this state and all property owned by the association
is exempt from taxation.
Sec. 12.
Minnesota Statutes 2008, section 62E.11, subdivision 5, is amended to read:
Subd. 5.
Allocation of losses.
new text begin (a) new text end Each contributing member of the association shall
share the losses due to claims expenses of the comprehensive health insurance plan for
plans issued or approved for issuance by the association, and shall share in the operating
and administrative expenses incurred or estimated to be incurred by the association
incident to the conduct of its affairs. Claims expenses of the state plan which exceed
the premium payments allocated to the payment of benefits shall be the liability of the
contributing members. Contributing members shall share in the claims expense of the
state plan and operating and administrative expenses of the association in an amount equal
to the ratio of the contributing member's total accident and health insurance premium,
received from or on behalf of Minnesota residents as divided by the total accident and
health insurance premium, received by all contributing members from or on behalf of
Minnesota residents, as determined by the commissioner. Payments made by the state
to a contributing member for medical assistance, MinnesotaCare, or general assistance
medical care services according to chapters 256, 256B, and 256D shall be excluded when
determining a contributing member's total premium.
new text begin
(b) In making the allocation of losses provided in paragraph (a) in each future year,
the association's assessment against the school employee insurance program must be
based on premiums received by the school employee insurance program in that future year
from the school employers that, on May 1, 2010, were receiving health care coverage
from a contributing member of the association. The association shall assess the premiums
paid in each future year by those employers at the same rate as premiums paid to other
members of the association. For purposes of this calculation, premiums of the program
used must be net of rate credits and retroactive rate refunds on the same basis as the
premiums of other association members.
new text end
Sec. 13.
Minnesota Statutes 2008, section 297I.05, is amended by adding a subdivision
to read:
new text begin Subd. 15. new text end
new text begin School employee insurance program. new text end
new text begin
A tax is imposed on the school
employee insurance program created under section 43A.316, subdivision 12. The tax must
be assessed upon gross premiums less return premiums received by the school employee
insurance program in that calendar year from a school employer that, on May 1, 2010,
was purchasing health care coverage from an entity that is required to pay tax under
subdivision 1, 3, 4, or 5. The commissioner shall assess the premiums paid in each year to
the school employee insurance program by those employers at the same rate as premiums
paid by the entities under subdivision 1, 3, 4, or 5 as applicable to the school employer.
new text end
Sec. 14.
Minnesota Statutes 2008, section 297I.15, subdivision 3, is amended to read:
Subd. 3.
Public employees insurance program.
Premiums paid to the public
employees insurance program under section 43A.316 are exempt from the taxes imposed
under this chapternew text begin , except for premiums paid to the school employee insurance program as
provided in section 297I.05, subdivision 15new text end .
Sec. 15. new text begin APPOINTMENTS TO SCHOOL EMPLOYEE INSURANCE
COMMITTEE; FIRST MEETING.
new text end
new text begin
The appointing authorities under Minnesota Statutes, section 43A.316, subdivision
14, shall complete their initial appointments no later than August 1, 2010. The
commissioner of finance, or the commissioner's designee, shall convene the first meeting
of the school employee insurance committee within 30 days after determining that (1)
an amendment or change to the coverage offered under Minnesota Statutes, section
43A.316, subdivision 12, is necessary; or (2) advice from the committee concerning the
administration of the coverage would assist the commissioner.
new text end
Sec. 16. new text begin START-UP FUNDING; ADMINISTRATION OF ONGOING
REVENUES AND EXPENSES.
new text end
new text begin
(a) The commissioner of Minnesota Management and Budget shall use funds
available in the insurance trust fund under Minnesota Statutes, section 43A.316,
subdivision 9, in the form of temporary funding to pay for the administrative start-up
costs necessary under this act. In addition to the amounts of temporary funding, the
commissioner shall determine the amount of interest lost to the insurance trust fund as a
result of the temporary funding.
new text end
new text begin
(b) The commissioner of Minnesota Management and Budget shall impose an
enrollment fee upon the premium charged for the first three months of coverage under the
school employee insurance program created in this act sufficient to repay to the insurance
trust fund the loans provided to cover the start-up costs incurred by the commissioner
under paragraph (a), plus foregone interest to the insurance trust fund, as determined
under paragraph (a). The commissioner shall deposit the enrollment fees in the insurance
trust fund.
new text end
new text begin
(c) All costs incurred and revenue received by the commissioner of Minnesota
Management and Budget under this act in addition to those dealt with in paragraphs (a)
and (b), shall on an ongoing basis be deposited into and paid out of the insurance trust fund
as provided in Minnesota Statutes, section 43A.316, subdivision 9, as amended in this act.
new text end
Sec. 17. new text begin EFFECTIVE DATE.
new text end
new text begin
Sections 1 to 6 and 8 to 12 are effective for coverage to begin January 1, 2012.
Sections 7 and 15 are effective August 1, 2010.
new text end