Office of the Revisor of Statutes
Minnesota Session Laws - 1997, Regular Session
Key: (1) language to be deleted (2) new language
CHAPTER 175-S.F.No. 1715
An act relating to insurance; making changes in
response to the federal Health Insurance Portability
and Accountability Act of 1996; amending Minnesota
Statutes 1996, sections 62E.02, subdivision 13;
62E.14, subdivisions 3 and 4c; 62H.01; 62L.02,
subdivisions 9, 11, 15, 19, 23, 24, 26, and by adding
subdivisions; 62L.03, subdivisions 1, 2, 3, 4, and 5;
and 62Q.18, subdivisions 1 and 7; proposing coding for
new law in Minnesota Statutes, chapter 62Q.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:
ARTICLE 1
INDIVIDUAL MARKET CHANGES (MCHA)
Section 1. Minnesota Statutes 1996, section 62E.02,
subdivision 13, is amended to read:
Subd. 13. [ELIGIBLE PERSON.] "Eligible person" means an
individual who is currently and has been a resident of Minnesota
for the six months immediately preceding the date of receipt by
the association or its writing carrier of a completed
certificate of eligibility and who meets the enrollment
requirements of section 62E.14. For purposes of eligibility
under section 62E.14, subdivision 4c, paragraph (b), this
definition is modified as provided in that paragraph.
Sec. 2. Minnesota Statutes 1996, section 62E.14,
subdivision 3, is amended to read:
Subd. 3. [PREEXISTING CONDITIONS.] No person who obtains
coverage pursuant to this section shall be covered for any
preexisting condition during the first six months of coverage
under the state plan if the person was diagnosed or treated for
that condition during the 90 days immediately preceding the
filing of an application except as provided under subdivisions
4, 4a, 4b, 4c, 4d, 5, and 6, and 7 and section 62E.18.
Sec. 3. Minnesota Statutes 1996, section 62E.14,
subdivision 4c, is amended to read:
Subd. 4c. [WAIVER OF PREEXISTING CONDITIONS FOR PERSONS
WHOSE COVERAGE IS TERMINATED OR WHO EXCEED THE MAXIMUM LIFETIME
BENEFIT.] (a) A Minnesota resident may enroll in the
comprehensive health plan with a waiver of the preexisting
condition limitation described in subdivision 3 if that person
applies for coverage within 90 days of termination of prior
coverage and if the termination is for reasons other than fraud
or nonpayment of premiums.
For purposes of this subdivision paragraph, termination of
prior coverage includes exceeding the maximum lifetime benefit
of existing coverage.
Coverage in the comprehensive health plan is effective on
the date of termination of prior coverage. The availability of
conversion rights does not affect a person's rights under this
subdivision paragraph.
This section does not apply to prior coverage provided
under policies designed primarily to provide coverage payable on
a per diem, fixed indemnity, or nonexpense incurred basis, or
policies providing only accident coverage.
(b) An eligible individual, as defined under United States
Code, chapter 42, section 300gg-41(b) may enroll in the
comprehensive health insurance plan with a waiver of the
preexisting condition limitation described in subdivision 3 and
a waiver of the evidence of rejection or similar events
described in subdivision 1, clause (c). The eligible individual
must apply for enrollment under this paragraph within 63 days of
termination of prior coverage, and coverage under the
comprehensive health insurance plan is effective as of the date
of receipt of the complete application. The six month
durational residency requirement provided in section 62E.02,
subdivision 13, does not apply with respect to eligibility for
enrollment under this paragraph, but the applicant must be a
Minnesota resident as of the date of application. A person's
eligibility to enroll under this paragraph does not affect the
person's eligibility to enroll under any other provision.
Sec. 4. [EFFECTIVE DATE.]
Sections 1 to 3 are effective January 1, 1998.
ARTICLE 2
SMALL EMPLOYER MARKET CHANGES
Section 1. Minnesota Statutes 1996, section 62L.02,
subdivision 9, is amended to read:
Subd. 9. [CONTINUOUS COVERAGE.] "Continuous coverage"
means the maintenance of continuous and uninterrupted qualifying
coverage. An individual is considered to have maintained
continuous coverage if the individual requests enrollment in
qualifying coverage within 30 63 days of termination of
qualifying coverage.
Sec. 2. Minnesota Statutes 1996, section 62L.02,
subdivision 11, is amended to read:
Subd. 11. [DEPENDENT.] "Dependent" means an eligible
employee's spouse, unmarried child who is under the age of 19
years, unmarried child under the age of 25 years who is a
full-time student as defined in section 62A.301, dependent child
of any age who is handicapped and who meets the eligibility
criteria in section 62A.14, subdivision 2, or any other person
whom state or federal law requires to be treated as a dependent
for purposes of health plans. For the purpose of this
definition, a child includes a child for whom the employee or
the employee's spouse has been appointed legal guardian and an
adoptive child as provided in section 62A.27.
Sec. 3. Minnesota Statutes 1996, section 62L.02, is
amended by adding a subdivision to read:
Subd. 13b. [ENROLLMENT DATE.] "Enrollment date" means,
with respect to a covered individual, the date of enrollment of
the individual in the health benefit plan or, if earlier, the
first day of the waiting period for the individual's enrollment.
Sec. 4. Minnesota Statutes 1996, section 62L.02,
subdivision 15, is amended to read:
Subd. 15. [HEALTH BENEFIT PLAN.] "Health benefit plan"
means a policy, contract, or certificate offered, sold, issued,
or renewed by a health carrier to a small employer for the
coverage of medical and hospital benefits. Health benefit plan
includes a small employer plan. Health benefit plan does not
include coverage, including any combination of the following
coverages, that is:
(1) limited to disability or income protection coverage;
(2) automobile medical payment coverage;
(3) liability insurance or supplemental to liability
insurance;
(4) designed solely to provide coverage for a specified
disease or illness or to provide payments on a per diem, fixed
indemnity, or non-expense-incurred basis, if offered as
independent, noncoordinated coverage;
(5) credit accident and health insurance as defined in
section 62B.02;
(6) designed solely to provide dental or vision care;
(7) blanket accident and sickness insurance as defined in
section 62A.11;
(8) accident-only coverage;
(9) a long-term care policy as defined in section 62A.46;
(10) issued as a supplement to Medicare, as defined in
sections 62A.31 to 62A.44, or policies, contracts, or
certificates that supplement Medicare issued by health
maintenance organizations or those policies, contracts, or
certificates governed by section 1833 or 1876 of the federal
Social Security Act, United States Code, title 42, section 1395,
et seq., as amended Medicare-related coverage as defined in
section 62Q.01, subdivision 6;
(11) workers' compensation insurance; or
(12) issued solely as a companion to a health maintenance
contract as described in section 62D.12, subdivision 1a, so long
as the health maintenance contract meets the definition of a
health benefit plan limited to care provided at on-site medical
clinics operated by an employer for the benefit of the
employer's employees and their dependents, in connection with
which the employer does not transfer risk.
For the purpose of this chapter, a health benefit plan
issued to eligible employees of a small employer who meets the
participation requirements of section 62L.03, subdivision 3, is
considered to have been issued to a small employer. A health
benefit plan issued on behalf of a health carrier is considered
to be issued by the health carrier.
Sec. 5. Minnesota Statutes 1996, section 62L.02,
subdivision 19, is amended to read:
Subd. 19. [LATE ENTRANT.] "Late entrant" means an eligible
employee or dependent who requests enrollment in a health
benefit plan of a small employer following the initial
enrollment period applicable to the employee or dependent under
the terms of the health benefit plan, provided that the initial
enrollment period must be a period of at least 30 days.
However, an eligible employee or dependent must not be
considered a late entrant if:
(1) the individual was covered under qualifying coverage at
the time the individual was eligible to enroll in the health
benefit plan, declined enrollment on that basis, and presents to
the health carrier a certificate of termination of the
qualifying coverage, due to loss of eligibility for that
coverage, or proof of the termination of employer contributions
toward that coverage, provided that the individual maintains
continuous coverage. and requests enrollment within 30 days of
termination of qualifying coverage or termination of the
employer's contribution toward that coverage. For purposes of
this clause, loss of eligibility includes loss of eligibility as
a result of legal separation, divorce, death, termination of
employment, or reduction in the number of hours of employment.
For purposes of this clause, an individual is not a late entrant
if the individual elects coverage under the health benefit plan
rather than accepting continuation coverage for which the
individual is eligible under state or federal law with respect
to the individual's previous qualifying coverage;
(2) the individual has lost coverage under another group
health plan due to the expiration of benefits available under
the Consolidated Omnibus Budget Reconciliation Act of 1985,
Public Law Number 99-272, as amended, and any state continuation
laws applicable to the employer or health carrier, provided that
the individual maintains continuous coverage and requests
enrollment within 30 days of the loss of coverage;
(3) the individual is a new spouse of an eligible employee,
provided that enrollment is requested within 30 days of becoming
legally married;
(4) the individual is a new dependent child of an eligible
employee, provided that enrollment is requested within 30 days
of becoming a dependent;
(5) the individual is employed by an employer that offers
multiple health benefit plans and the individual elects a
different plan during an open enrollment period; or
(6) a court has ordered that coverage be provided for a
former spouse or dependent child under a covered employee's
health benefit plan and request for enrollment is made within 30
days after issuance of the court order.
Sec. 6. Minnesota Statutes 1996, section 62L.02,
subdivision 23, is amended to read:
Subd. 23. [PREEXISTING CONDITION.] "Preexisting condition"
means, with respect to coverage, a condition manifesting in a
manner that causes an ordinarily prudent person to seek medical
advice, diagnosis, care, or treatment or present before the
individual's enrollment date for the coverage, for which medical
advice, diagnosis, care, or treatment was recommended or
received during the six months immediately preceding
the effective date of coverage, or a pregnancy existing as of
the effective date of coverage of a health benefit
plan enrollment date.
Sec. 7. Minnesota Statutes 1996, section 62L.02,
subdivision 24, is amended to read:
Subd. 24. [QUALIFYING COVERAGE.] "Qualifying coverage"
means health benefits or health coverage provided under:
(1) a health benefit plan, as defined in this section, but
without regard to whether it is issued to a small employer and
including blanket accident and sickness insurance, other than
accident-only coverage, as defined in section 62A.11;
(2) part A or part B of Medicare;
(3) medical assistance under chapter 256B;
(4) general assistance medical care under chapter 256D;
(5) MCHA;
(6) a self-insured health plan;
(7) the MinnesotaCare program established under section
256.9352, when the plan includes inpatient hospital services as
provided in section 256.9353;
(8) a plan provided under section 43A.316, 43A.317, or
471.617;
(9) the Civilian Health and Medical Program of the
Uniformed Services (CHAMPUS) or other coverage provided under
United States Code, title 10, chapter 55;
(10) coverage provided by a health care network cooperative
under chapter 62R or by a health provider cooperative under
section 62R.17; or
(11) a medical care program of the Indian Health Service or
of a tribal organization;
(12) the federal Employees Health Benefits Plan, or other
coverage provided under United States Code, title 5, chapter 89;
(13) a health benefit plan under section 5(e) of the Peace
Corps Act, codified as United States Code, title 22, section
2504(e); or
(14) a plan similar to any of the above plans provided in
this state or in another state as determined by the commissioner.
Sec. 8. Minnesota Statutes 1996, section 62L.02,
subdivision 26, is amended to read:
Subd. 26. [SMALL EMPLOYER.] (a) "Small employer" means,
with respect to a calendar year and a plan year, a person, firm,
corporation, partnership, association, or other entity actively
engaged in business, including a political subdivision of the
state, that, on at least 50 percent of its working days during
the preceding 12 months, employed an average of no fewer than
two nor more than 29, or after June 30, 1995, more than 49, 50
current employees, the majority of whom were employed in this
state. If an employer has only two eligible employees and one
is the spouse, child, sibling, parent, or grandparent of the
other, the employer must be a Minnesota domiciled employer and
have paid social security or self-employment tax on behalf of
both eligible employees on business days during the preceding
calendar year and that employs at least two current employees on
the first day of the plan year. If an employer has only one
eligible employee who has not waived coverage, the sale of a
health plan to or for that eligible employee is not a sale to a
small employer and is not subject to this chapter and may be
treated as the sale of an individual health plan. A small
employer plan may be offered through a domiciled association to
self-employed individuals and small employers who are members of
the association, even if the self-employed individual or small
employer has fewer than two current employees. Entities that
are eligible to file a combined tax return for purposes of state
tax laws treated as a single employer under subsection (b), (c),
(m), or (o) of section 414 of the federal Internal Revenue Code
are considered a single employer for purposes of determining the
number of current employees. Small employer status must be
determined on an annual basis as of the renewal date of the
health benefit plan. The provisions of this chapter continue to
apply to an employer who no longer meets the requirements of
this definition until the annual renewal date of the employer's
health benefit plan. If an employer was not in existence
throughout the preceding calendar year, the determination of
whether the employer is a small employer is based upon the
average number of current employees that it is reasonably
expected that the employer will employ on business days in the
current calendar year. For purposes of this definition, the
term employer includes any predecessor of the employer. An
employer that has more than 50 current employees but has 50 or
fewer employees, as "employee" is defined under United States
Code, title 29, section 1002(6), is a small employer under this
subdivision.
(b) Where an association, as defined in section 62L.045,
comprised of employers contracts with a health carrier to
provide coverage to its members who are small employers, the
association and health benefit plans it provides to small
employers, are subject to section 62L.045, with respect to small
employers in the association, even though the association also
provides coverage to its members that do not qualify as small
employers.
(c) If an employer has employees covered under a trust
specified in a collective bargaining agreement under the federal
Labor-Management Relations Act of 1947, United States Code,
title 29, section 141, et seq., as amended, or employees whose
health coverage is determined by a collective bargaining
agreement and, as a result of the collective bargaining
agreement, is purchased separately from the health plan provided
to other employees, those employees are excluded in determining
whether the employer qualifies as a small employer. Those
employees are considered to be a separate small employer if they
constitute a group that would qualify as a small employer in the
absence of the employees who are not subject to the collective
bargaining agreement.
Sec. 9. Minnesota Statutes 1996, section 62L.02, is
amended by adding a subdivision to read:
Subd. 29. [WAITING PERIOD.] "Waiting period" means, with
respect to an individual who is a potential enrollee under a
health benefit plan, the period that must pass with respect to
the individual before the individual is eligible, under the
employer's eligibility requirements, for coverage under the
health benefit plan.
Sec. 10. Minnesota Statutes 1996, section 62L.03,
subdivision 1, is amended to read:
Subdivision 1. [GUARANTEED ISSUE AND REISSUE.] (a) Every
health carrier shall, as a condition of authority to transact
business in this state in the small employer market,
affirmatively market, offer, sell, issue, and renew any of its
health benefit plans, on a guaranteed issue basis, to any small
employer that meets the participation and contribution
requirements of subdivision 3, as provided in this chapter.
(b) Notwithstanding paragraph (a), a health carrier may, at
the time of coverage renewal, modify the health coverage for a
product offered in the small employer market if the modification
is consistent with state law, approved by the commissioner, and
effective on a uniform basis for all small employers purchasing
that product other than through a qualified association in
compliance with section 62L.045, subdivision 2.
This requirement Paragraph (a) does not apply to a health
benefit plan designed for a small employer to comply with a
collective bargaining agreement, provided that the health
benefit plan otherwise complies with this chapter and is not
offered to other small employers, except for other small
employers that need it for the same reason. This paragraph
applies only with respect to collective bargaining agreements
entered into prior to August 21, 1996, and only with respect to
plan years beginning before the later of July 1, 1997, or the
date upon which the last of the collective bargaining agreements
relating to the plan terminates determined without regard to any
extension agreed to after August 21, 1996.
(c) Every health carrier participating in the small
employer market shall make available both of the plans described
in section 62L.05 to small employers and shall fully comply with
the underwriting and the rate restrictions specified in this
chapter for all health benefit plans issued to small employers.
(d) A health carrier may cease to transact business in the
small employer market as provided under section 62L.09.
Sec. 11. Minnesota Statutes 1996, section 62L.03,
subdivision 2, is amended to read:
Subd. 2. [EXCEPTIONS.] (a) No health maintenance
organization is required to offer coverage or accept
applications under subdivision 1 in the case of the following:
(1) with respect to a small employer, where the worksite of
the employees of the small employer is not physically located
does not have eligible employees who work or reside in the
health maintenance organization's approved service areas; or
(2) with respect to an employee, when the employee does not
work or reside within the health maintenance organization's
approved service areas.
(b) A health carrier participating in the small employer
market shall not be required to offer coverage or accept
applications pursuant to subdivision 1 where the commissioner
finds that the acceptance of an application or applications
would place the health carrier participating in the small
employer market in a financially impaired condition, provided,
however, that a health carrier participating in the small
employer market that has not offered coverage or accepted
applications pursuant to this paragraph shall not offer coverage
or accept applications for any health benefit plan until 180
days following a determination by the commissioner that the
health carrier is not financially impaired and that offering
coverage or accepting applications under subdivision 1 would not
cause the health carrier to become financially impaired.
Sec. 12. Minnesota Statutes 1996, section 62L.03,
subdivision 3, is amended to read:
Subd. 3. [MINIMUM PARTICIPATION AND CONTRIBUTION.] (a) A
small employer that has at least 75 percent of its eligible
employees who have not waived coverage participating in a health
benefit plan and that contributes at least 50 percent toward the
cost of coverage of each eligible employee must be guaranteed
coverage on a guaranteed issue basis from any health carrier
participating in the small employer market. The participation
level of eligible employees must be determined at the initial
offering of coverage and at the renewal date of coverage. A
health carrier must not increase the participation requirements
applicable to a small employer at any time after the small
employer has been accepted for coverage. For the purposes of
this subdivision, waiver of coverage includes only waivers due
to: (1) coverage under another group health plan; (2) coverage
under Medicare Parts A and B; (3) coverage under MCHA permitted
under section 62E.141; or (4) coverage under medical assistance
under chapter 256B or general assistance medical care under
chapter 256D.
(b) If a small employer does not satisfy the contribution
or participation requirements under this subdivision, a health
carrier may voluntarily issue or renew individual health plans,
or a health benefit plan which must fully comply with this
chapter. A health carrier that provides a health benefit plan
to a small employer that does not meet the contribution or
participation requirements of this subdivision must maintain
this information in its files for audit by the commissioner. A
health carrier may not offer an individual health plan,
purchased through an arrangement between the employer and the
health carrier, to any employee unless the health carrier also
offers the individual health plan, on a guaranteed issue basis,
to all other employees of the same employer.
(c) Nothing in this section obligates a health carrier to
issue coverage to a small employer that currently offers
coverage through a health benefit plan from another health
carrier, unless the new coverage will replace the existing
coverage and not serve as one of two or more health benefit
plans offered by the employer. This paragraph does not apply if
the small employer will meet the required participation level
with respect to the new coverage.
Sec. 13. Minnesota Statutes 1996, section 62L.03,
subdivision 4, is amended to read:
Subd. 4. [UNDERWRITING RESTRICTIONS.] (a) Health carriers
may apply underwriting restrictions to coverage for health
benefit plans for small employers, including any preexisting
condition limitations, only as expressly permitted under this
chapter. For purposes of this section, "underwriting
restrictions" means any refusal of the health carrier to issue
or renew coverage, any premium rate higher than the lowest rate
charged by the health carrier for the same coverage, any
preexisting condition limitation, preexisting condition
exclusion, or any exclusionary rider.
(b) Health carriers may collect information relating to the
case characteristics and demographic composition of small
employers, as well as health status and health history
information about employees, and dependents of employees, of
small employers.
(c) Except as otherwise authorized for late entrants,
preexisting conditions may be excluded by a health carrier for a
period not to exceed 12 months from the effective enrollment
date of coverage of an eligible employee or dependent, but
exclusionary riders must not be used. When calculating a
preexisting condition limitation, a health carrier shall credit
the time period an eligible employee or dependent was previously
covered by qualifying coverage, provided that the individual
maintains continuous coverage. Late entrants may be subject to
a preexisting condition limitation not to exceed 18 months from
the effective enrollment date of coverage of the late entrant,
but must not be subject to any exclusionary rider or preexisting
condition exclusion. When calculating any length of preexisting
condition limitation, a health carrier shall credit the time
period an eligible employee or dependent was previously covered
by qualifying coverage, provided that the individual maintains
continuous coverage. The credit must be given for all
qualifying coverage with respect to all preexisting conditions,
regardless of whether the conditions were preexisting with
respect to any previous qualifying coverage. Section 60A.082,
relating to replacement of group coverage, and the rules adopted
under that section apply to this chapter, and this chapter's
requirements are in addition to the requirements of that section
and the rules adopted under it. A health carrier shall, at the
time of first issuance or renewal of a health benefit plan on or
after July 1, 1993, credit against any preexisting condition
limitation or exclusion permitted under this section, the time
period prior to July 1, 1993, during which an eligible employee
or dependent was covered by qualifying coverage, if the person
has maintained continuous coverage.
(d) Health carriers shall not use pregnancy as a
preexisting condition under this chapter.
Sec. 14. Minnesota Statutes 1996, section 62L.03,
subdivision 5, is amended to read:
Subd. 5. [CANCELLATIONS AND FAILURES TO RENEW.] (a) No
health carrier shall cancel, decline to issue, or fail to renew
a health benefit plan as a result of the claim experience or
health status of the persons covered or to be covered by the
health benefit plan. For purposes of this subdivision, a
failure to renew does not include a uniform modification of
coverage at time of renewal, as described in subdivision 1.
(b) A health carrier may cancel or fail to renew a health
benefit plan:
(1) for nonpayment of the required premium;
(2) for fraud or misrepresentation by the small employer,
or, with respect to coverage of an individual eligible employee
or dependent, fraud or misrepresentation by the eligible
employee or dependent, with respect to eligibility for coverage
or any other material fact;
(3) if the employer fails to comply with the minimum
contribution percentage required under subdivision 3; or
(4) for any other reasons or grounds expressly permitted by
the respective licensing laws and regulations governing a health
carrier, including, but not limited to, service area
restrictions imposed on health maintenance organizations under
section 62D.03, subdivision 4, paragraph (m), to the extent that
these grounds are not expressly inconsistent with this chapter.
(c) A health carrier may fail to renew a health benefit
plan:
(1) if eligible employee participation during the preceding
calendar year declines to less than 75 percent, subject to the
waiver of coverage provision in subdivision 3;
(2) if the health carrier ceases to do business in the
small employer market under section 62L.09; or
(3) if a failure to renew is based upon the health
carrier's decision to discontinue the health benefit plan form
previously issued to the small employer, but only if the health
carrier permits each small employer covered under the prior form
to switch to its choice of any other health benefit plan offered
by the health carrier, without any underwriting restrictions
that would not have been permitted for renewal purposes.
(d) A health carrier need not renew a health benefit plan,
and shall not renew a small employer plan, if an employer ceases
to qualify as a small employer as defined in section 62L.02. If
a health benefit plan, other than a small employer plan,
provides terms of renewal that do not exclude an employer that
is no longer a small employer, the health benefit plan may be
renewed according to its own terms. If a health carrier issues
or renews a health plan to an employer that is no longer a small
employer, without interruption of coverage, the health plan is
subject to section 60A.082. Between July 1, 1994, and June 30,
1995, a health benefit plan in force during this time may be
renewed, if the number of employees exceeds two, but does not
exceed 49 employees.
Sec. 15. [EFFECTIVE DATE.]
Sections 1 to 14 are effective July 1, 1997, and apply to
coverage issued or renewed on or after that date.
ARTICLE 3
LARGE EMPLOYER MARKET CHANGES
Section 1. Minnesota Statutes 1996, section 62Q.18,
subdivision 1, is amended to read:
Subdivision 1. [DEFINITION.] For purposes of this section,
(1) "continuous coverage" has the meaning given in section
62L.02, subdivision 9;
(2) "guaranteed issue" means:
(i) for individual health plans, that a health plan company
shall not decline an application by an individual for any
individual health plan offered by that health plan company,
including coverage for a dependent of the individual to whom the
health plan has been or would be issued; and
(ii) for group health plans, that a health plan company
shall not decline an application by a group for any group health
plan offered by that health plan company and shall not decline
to cover under the group health plan any person eligible for
coverage under the group's eligibility requirements, including
persons who become eligible after initial issuance of the group
health plan; and
(3) "large employer" means an entity that would be a small
employer, as defined in section 62L.02, subdivision 26, except
that the entity has more than 50 current employees, based upon
the method provided in that subdivision for determining the
number of current employees;
(4) "preexisting condition" has the meaning given in
section 62L.02, subdivision 23; and
(3) (5) "qualifying coverage" has the meaning given in
section 62L.02, subdivision 24.
Sec. 2. Minnesota Statutes 1996, section 62Q.18,
subdivision 7, is amended to read:
Subd. 7. [PORTABILITY OF COVERAGE.] Effective July 1,
1994, no health plan company shall offer, sell, issue, or renew
any group health plan that does not, with respect to individuals
who maintain continuous coverage and who qualify under the
group's eligibility requirements:
(1) make coverage available on a guaranteed issue basis;
and
(2) give full credit for previous continuous coverage
against any applicable preexisting condition limitation or
preexisting condition exclusion.; and
(3) with respect to a group health plan offered, sold,
issued, or renewed to a large employer, impose preexisting
condition limitations or preexisting condition exclusions except
to the extent that would be permitted under chapter 62L if the
group sponsor were a small employer as defined in section
62L.02, subdivision 26.
To the extent that this subdivision conflicts with chapter
62L, chapter 62L governs, regardless of whether the group
sponsor is a small employer as defined in section 62L.02, except
that for group health plans issued to groups that are not small
employers, this subdivision's requirement that the individual
have maintained continuous coverage applies. An individual who
has maintained continuous coverage, but would be considered a
late entrant under chapter 62L, may be treated as a late entrant
in the same manner under this subdivision as permitted under
chapter 62L.
Sec. 3. [62Q.185] [GUARANTEED RENEWABILITY; LARGE EMPLOYER
GROUP HEALTH COVERAGE.]
(a) No health plan company, as defined in section 62Q.01,
subdivision 4, shall refuse to renew a health benefit plan, as
defined in section 62L.02, subdivision 15, but issued to a large
employer, as defined in section 62Q.18, subdivision 1.
(b) This section does not require renewal if:
(1) the large employer has failed to pay premiums or
contributions as required under the terms of the health benefit
plan, or the health plan company has not received timely premium
payments unless the late payments were received within a grace
period provided under state law;
(2) the large employer has performed an act or practice
that constitutes fraud or misrepresentation of material fact
under the terms of the health benefit plan;
(3) the large employer has failed to comply with a material
plan provision relating to employer contribution or group
participation rules not prohibited by state law;
(4) the health plan company is ceasing to offer coverage in
the large employer market in this state in compliance with
United States Code, title 42, section 300gg-12(c), and
applicable state law;
(5) in the case of a health maintenance organization, there
is no longer any enrollee in the large employer's health benefit
plan who lives, resides, or works in the approved service area;
or
(6) in the case of a health benefit plan made available to
large employers only through one or more bona fide associations,
the membership of the large employer in the association ceases,
but only if such coverage is terminated uniformly without regard
to any health-related factor relating to any covered individual.
(c) This section does not prohibit a health plan company
from modifying the premium rate or from modifying the coverage
for purposes of renewal.
Sec. 4. [EFFECTIVE DATE.]
Sections 1 to 3 are effective July 1, 1997, and apply to
health benefit plans offered, sold, issued, or renewed on or
after that date.
ARTICLE 4
GENERAL PROVISIONS
Section 1. Minnesota Statutes 1996, section 62H.01, is
amended to read:
62H.01 [JOINT SELF-INSURANCE EMPLOYEE HEALTH PLAN.]
Any two or more employers, excluding the state and its
political subdivisions as described in section 471.617,
subdivision 1, who are authorized to transact business in
Minnesota may jointly self-insure employee health, dental,
short-term disability benefits, or other benefits permitted
under the Employee Retirement Income Security Act of 1974,
United States Code, title 29, sections 1001 et seq. Joint plans
must have a minimum of 100 covered employees and meet all
conditions and terms of sections 62H.01 to 62H.08. Joint plans
covering employers not resident in Minnesota must meet the
requirements of sections 62H.01 to 62H.08 as if the portion of
the plan covering Minnesota resident employees was treated as a
separate plan. A plan may cover employees resident in other
states only if the plan complies with the applicable laws of
that state.
A multiple employer welfare arrangement as defined in
United States Code, title 29, section 1002(40)(a), is subject to
this chapter to the extent authorized by the Employee Retirement
Income Security Act of 1974, United States Code, title 29,
sections 1001 et seq. The commissioner of commerce may, on
behalf of the state, enter into an agreement with the United
States Secretary of Labor for delegation to the state of some or
all of the secretary's enforcement authority with respect to
multiple employer welfare arrangements, as described in United
States Code, title 29, section 1136(c).
Sec. 2. [62Q.021] [FEDERAL ACT; COMPLIANCE REQUIRED.]
Each health plan company shall comply with the federal
Health Insurance Portability and Accountability Act of 1996,
including any federal regulations adopted under that act, to the
extent that it imposes a requirement that applies in this state
and that is not also required by the laws of this state. This
section does not require compliance with any provision of the
federal act prior to the effective date provided for that
provision in the federal act. The commissioner shall enforce
this section.
Sec. 3. [62Q.181] [WRITTEN CERTIFICATION OF COVERAGE.]
A health plan company shall provide the written
certifications of coverage required under United States Code,
title 42, sections 300gg(e) and 300gg-43. This section applies
only to coverage that is subject to regulation under state law
and only to the extent that the certification of coverage is
required under federal law. The commissioner shall enforce this
section.
Sec. 4. [EFFECTIVE DATE.]
Sections 1 and 2 are effective the day following final
enactment. Section 3 is effective July 1, 1997.
Presented to the governor May 17, 1997
Signed by the governor May 19, 1997, 7:11 p.m.
Official Publication of the State of Minnesota
Revisor of Statutes