1.1                          A bill for an act 
  1.2             relating to insurance; regulating certain licenses, 
  1.3             fees, and coverages; amending Minnesota Statutes 2000, 
  1.4             sections 62A.25, subdivision 2; 62A.31, subdivision 
  1.5             1h; 62E.14, subdivisions 4, 5, 6; 62L.02, subdivision 
  1.6             13a; 62L.03, subdivisions 1, 5; 62Q.185; 79A.04, 
  1.7             subdivision 9; Minnesota Statutes 2001 Supplement, 
  1.8             sections 60A.14, subdivision 1; 60K.56, subdivisions 
  1.9             6, 8, 9; 62M.03, subdivision 2; Laws 2001, chapter 
  1.10            117, article 1, section 29. 
  1.11  BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  1.12     Section 1.  Minnesota Statutes 2001 Supplement, section 
  1.13  60A.14, subdivision 1, is amended to read: 
  1.14     Subdivision 1.  [FEES OTHER THAN EXAMINATION FEES.] In 
  1.15  addition to the fees and charges provided for examinations, the 
  1.16  following fees must be paid to the commissioner for deposit in 
  1.17  the general fund: 
  1.18     (a) by township mutual fire insurance companies: 
  1.19     (1) for filing certificate of incorporation $25 and 
  1.20  amendments thereto, $10; 
  1.21     (2) for filing annual statements, $15; 
  1.22     (3) for each annual certificate of authority, $15; 
  1.23     (4) for filing bylaws $25 and amendments thereto, $10. 
  1.24     (b) by other domestic and foreign companies including 
  1.25  fraternals and reciprocal exchanges: 
  1.26     (1) for filing certified copy of certificate of articles of 
  1.27  incorporation, $100; 
  1.28     (2) for filing annual statement, $225; 
  2.1      (3) for filing certified copy of amendment to certificate 
  2.2   or articles of incorporation, $100; 
  2.3      (4) for filing bylaws, $75 or amendments thereto, $75; 
  2.4      (5) for each company's certificate of authority, $575, 
  2.5   annually. 
  2.6      (c) the following general fees apply: 
  2.7      (1) for each certificate, including certified copy of 
  2.8   certificate of authority, renewal, valuation of life policies, 
  2.9   corporate condition or qualification, $25; 
  2.10     (2) for each copy of paper on file in the commissioner's 
  2.11  office 50 cents per page, and $2.50 for certifying the same; 
  2.12     (3) for license to procure insurance in unadmitted foreign 
  2.13  companies, $575; 
  2.14     (4) for valuing the policies of life insurance companies, 
  2.15  one cent per $1,000 of insurance so valued, provided that the 
  2.16  fee shall not exceed $13,000 per year for any company.  The 
  2.17  commissioner may, in lieu of a valuation of the policies of any 
  2.18  foreign life insurance company admitted, or applying for 
  2.19  admission, to do business in this state, accept a certificate of 
  2.20  valuation from the company's own actuary or from the 
  2.21  commissioner of insurance of the state or territory in which the 
  2.22  company is domiciled; 
  2.23     (5) for receiving and filing certificates of policies by 
  2.24  the company's actuary, or by the commissioner of insurance of 
  2.25  any other state or territory, $50; 
  2.26     (6) for each appointment of an agent filed with the 
  2.27  commissioner, $10; 
  2.28     (7) for filing forms and rates, $75 per filing, ~~to~~ which 
  2.29  may be paid on a quarterly basis in response to an invoice.  
  2.30  Billing and payment may be made electronically; 
  2.31     (8) for annual renewal of surplus lines insurer license, 
  2.32  $300. 
  2.33     The commissioner shall adopt rules to define filings that 
  2.34  are subject to a fee. 
  2.35     Sec. 2.  Minnesota Statutes 2001 Supplement, section 
  2.36  60K.56, subdivision 6, is amended to read: 
  3.1      Subd. 6.  [MINIMUM EDUCATION REQUIREMENT.] Each person 
  3.2   subject to this section shall complete a minimum of 30 credit 
  3.3   hours of courses accredited by the commissioner during each 
  3.4   24-month licensing period.  Any person whose initial licensing 
  3.5   period extends more than six months shall complete 15 hours of 
  3.6   courses accredited by the commissioner during the initial 
  3.7   license period.  Any person teaching or lecturing at an 
  3.8   accredited course qualifies for ~~1-1/2~~ three times the number of 
  3.9   credit hours that would be granted to a person completing the 
  3.10  accredited course.  No more than ~~15~~ one-half credit hours per 
  3.11  licensing period required under this section may be credited to 
  3.12  a person for ~~courses~~ attending any combination of courses either 
  3.13  sponsored by, offered by, or affiliated with an insurance 
  3.14  company or its agents; or offered using new delivery technology, 
  3.15  including computer, interactive technology, and the Internet.  
  3.16  Courses sponsored by, offered by, or affiliated with an 
  3.17  insurance company or agent may restrict its students to agents 
  3.18  of the company or agency. 
  3.19     Sec. 3.  Minnesota Statutes 2001 Supplement, section 
  3.20  60K.56, subdivision 8, is amended to read: 
  3.21     Subd. 8.  [REPORTING.] (a) After completing the minimum 
  3.22  education requirement, each person subject to this section shall 
  3.23  file or cause to be filed a compliance report in accordance with 
  3.24  the procedures adopted by the commissioner.  ~~The compliance~~ 
  3.25  ~~report~~ A producer must not claim credit for continuing education 
  3.26  not actually completed at the date of filing the report. 
  3.27     (b) An institution offering an accredited course shall 
  3.28  comply with the procedure for reporting compliance adopted by 
  3.29  the commissioner.  
  3.30     (c) If a person subject to this section completes a 
  3.31  nonaccredited course, that person may submit ~~a written report to~~ 
  3.32  ~~the advisory committee~~ an application of the commissioner for 
  3.33  approval of the course accompanied by a fee of not more than $10 
  3.34  payable to the state of Minnesota for deposit in the general 
  3.35  fund.  ~~This report must be accompanied by proof satisfactory to~~ 
  3.36  ~~the commissioner that the person has completed the minimum~~ 
  4.1   ~~education requirement for the annual period during which the~~ 
  4.2   ~~nonaccredited course was completed.~~  Upon ~~the recommendation of~~ 
  4.3   ~~the advisory committee~~ a determination that the course satisfies 
  4.4   the criteria for course accreditation, the commissioner may 
  4.5   approve the nonaccredited course and shall so inform the 
  4.6   person.  ~~If the nonaccredited course is approved by the~~ 
  4.7   ~~commissioner, it may be used to satisfy the minimum education~~ 
  4.8   ~~requirement for the person's next annual compliance period.~~  
  4.9      Sec. 4.  Minnesota Statutes 2001 Supplement, section 
  4.10  60K.56, subdivision 9, is amended to read: 
  4.11     Subd. 9.  [ENFORCEMENT.] If a person subject to this 
  4.12  section fails to complete the minimum education or reporting 
  4.13  requirement or to pay the prescribed fees for any licensing 
  4.14  period, no license may be renewed or continued in force for that 
  4.15  person for any class of insurance beginning ~~June~~ November 1 of 
  4.16  the year due and that person may not act as an insurance 
  4.17  producer until the person has demonstrated to the satisfaction 
  4.18  of the commissioner that all requirements of this section have 
  4.19  been complied with or that a waiver or extension has been 
  4.20  obtained.  
  4.21     Sec. 5.  Minnesota Statutes 2000, section 62A.25, 
  4.22  subdivision 2, is amended to read: 
  4.23     Subd. 2.  Every policy, plan, certificate or contract to 
  4.24  which this section applies shall provide benefits for 
  4.25  reconstructive surgery when such service is incidental to or 
  4.26  follows surgery resulting from injury, sickness or other 
  4.27  diseases of the involved part or when such service is performed 
  4.28  on a covered dependent child because of congenital disease or 
  4.29  anomaly which has resulted in a functional defect as determined 
  4.30  by the attending physician.  Reconstructive surgery benefits 
  4.31  include all stages of reconstruction of the breast on which the 
  4.32  mastectomy has been performed, surgery and reconstruction of the 
  4.33  other breast to produce a symmetrical appearance, and prosthesis 
  4.34  and physical complications at all stages of a mastectomy, 
  4.35  including lymphedemas, in a manner determined in consultation 
  4.36  with the attending physician and patient.  Coverage may be 
  5.1   subject to annual deductible, copayment, and coinsurance 
  5.2   provisions as may be deemed appropriate and as are consistent 
  5.3   with those established for other benefits under the plan or 
  5.4   coverage. Coverage may not: 
  5.5      (1) deny to a patient eligibility, or continued 
  5.6   eligibility, to enroll or to renew coverage under the terms of 
  5.7   the plan, solely for the purpose of avoiding the requirements of 
  5.8   this section; and 
  5.9      (2) penalize or otherwise reduce or limit the reimbursement 
  5.10  of an attending provider, or provide monetary or other 
  5.11  incentives to an attending provider to induce the provider to 
  5.12  provide care to an individual participant or beneficiary in a 
  5.13  manner inconsistent with this section. 
  5.14  Written notice of the availability of the coverage must be 
  5.15  delivered to the participant upon enrollment and annually 
  5.16  thereafter.  The health carrier must provide notice to each 
  5.17  current participant and beneficiary in the next mailing made by 
  5.18  the health carrier and as part of any yearly information packet 
  5.19  sent to the participant or beneficiary. 
  5.20     Sec. 6.  Minnesota Statutes 2000, section 62A.31, 
  5.21  subdivision 1h, is amended to read: 
  5.22     Subd. 1h.  [LIMITATIONS ON DENIALS, CONDITIONS, AND PRICING 
  5.23  OF COVERAGE.] No health carrier issuing Medicare-related 
  5.24  coverage in this state may impose preexisting condition 
  5.25  limitations or otherwise deny or condition the issuance or 
  5.26  effectiveness of any such coverage available for sale in this 
  5.27  state, nor may it discriminate in the pricing of such coverage, 
  5.28  because of the health status, claims experience, receipt of 
  5.29  health care, medical condition, or age of an applicant where an 
  5.30  application for such coverage is submitted prior to or during 
  5.31  the six-month period beginning with the first day of the month 
  5.32  in which an individual first enrolled for benefits under 
  5.33  Medicare Part B.  This subdivision applies to each 
  5.34  Medicare-related coverage offered by a health carrier regardless 
  5.35  of whether the individual has attained the age of 65 years.  If 
  5.36  an individual who is enrolled in Medicare Part B due to 
  6.1   disability status is involuntarily disenrolled due to loss of 
  6.2   disability status, the individual is eligible for another 
  6.3   six-month enrollment period provided under this subdivision 
  6.4   beginning the first day of the month in which the individual 
  6.5   later becomes eligible for and enrolls again in Medicare Part 
  6.6   B.  An individual who is or was previously enrolled in Medicare 
  6.7   Part B due to disability status is eligible for another 
  6.8   six-month enrollment period under this subdivision beginning the 
  6.9   first day of the month in which the individual has attained the 
  6.10  age of 65 years and either maintains enrollment in, or enrolls 
  6.11  again in, Medicare Part B.  If an individual enrolled in 
  6.12  Medicare Part B voluntarily disenrolls from Medicare Part B 
  6.13  because the individual becomes reemployed and is enrolled under 
  6.14  an employee welfare benefit plan, the individual is eligible for 
  6.15  another six-month enrollment period, as provided in this 
  6.16  subdivision, beginning the first day of the month in which the 
  6.17  individual later becomes eligible for and enrolls again in 
  6.18  Medicare Part B. 
  6.19     Sec. 7.  Minnesota Statutes 2000, section 62E.14, 
  6.20  subdivision 4, is amended to read: 
  6.21     Subd. 4.  [WAIVER OF PREEXISTING CONDITIONS FOR MEDICARE 
  6.22  SUPPLEMENT PLAN ENROLLEES.] Notwithstanding the above, any 
  6.23  Minnesota resident holder of a policy or certificate of Medicare 
  6.24  supplement coverages pursuant to sections 62A.315 and 62A.316, 
  6.25  or Medicare supplement plans previously approved by the 
  6.26  commissioner, may enroll in the comprehensive health insurance 
  6.27  plan as described in section 62E.07, with a waiver of the 
  6.28  preexisting condition as described in subdivision 3, without 
  6.29  interruption in coverage, provided, the policy or certificate 
  6.30  has been terminated by the insurer for reasons other than 
  6.31  nonpayment of premium and, provided further, that the option to 
  6.32  enroll in the plan is exercised within ~~30~~ 90 days of termination 
  6.33  of the existing contract. 
  6.34     Coverage in the state plan for purposes of this section 
  6.35  shall be effective on the date of termination upon completion of 
  6.36  the proper application and payment of the required premium.  The 
  7.1   application must include evidence of termination of the existing 
  7.2   policy or certificate. 
  7.3      Sec. 8.  Minnesota Statutes 2000, section 62E.14, 
  7.4   subdivision 5, is amended to read: 
  7.5      Subd. 5.  [TERMINATED EMPLOYEES.] An employee who is 
  7.6   voluntarily or involuntarily terminated or laid off from 
  7.7   employment and unable to exercise the option to continue 
  7.8   coverage under section 62A.17 may enroll, within ~~60~~ 90 days of 
  7.9   termination or layoff, with a waiver of the preexisting 
  7.10  condition limitation set forth in subdivision 3 and a waiver of 
  7.11  the evidence of rejection set forth in subdivision 1, paragraph 
  7.12  (c). 
  7.13     Sec. 9.  Minnesota Statutes 2000, section 62E.14, 
  7.14  subdivision 6, is amended to read: 
  7.15     Subd. 6.  [TERMINATION OF INDIVIDUAL POLICY OR CONTRACT.] A 
  7.16  Minnesota resident who holds an individual health maintenance 
  7.17  contract, individual nonprofit health service corporation 
  7.18  contract, or an individual insurance policy previously approved 
  7.19  by the commissioners of health or commerce, may enroll in the 
  7.20  comprehensive health insurance plan with a waiver of the 
  7.21  preexisting condition as described in subdivision 3, without 
  7.22  interruption in coverage, provided (1) no replacement coverage 
  7.23  that meets the requirements of section 62D.121 was offered by 
  7.24  the contributing member, and (2) the policy or contract has been 
  7.25  terminated for reasons other than (a) nonpayment of premium; (b) 
  7.26  failure to make copayments required by the health care plan; (c) 
  7.27  moving out of the area served; or (d) a materially false 
  7.28  statement or misrepresentation by the enrollee in the 
  7.29  application for membership; and, provided further, that the 
  7.30  option to enroll in the plan is exercised within ~~30~~ 90 days of 
  7.31  termination of the existing policy or contract. 
  7.32     Coverage allowed under this section is effective when the 
  7.33  contract or policy is terminated and the enrollee has completed 
  7.34  the proper application and paid the required premium or fee. 
  7.35     Expenses incurred from the preexisting conditions of 
  7.36  individuals enrolled in the state plan under this subdivision 
  8.1   must be paid by the contributing member canceling coverage as 
  8.2   set forth in section 62E.11, subdivision 10. 
  8.3      The application must include evidence of termination of the 
  8.4   existing policy or certificate as required in subdivision 1. 
  8.5      Sec. 10.  Minnesota Statutes 2000, section 62L.02, 
  8.6   subdivision 13a, is amended to read: 
  8.7      Subd. 13a.  [EMPLOYEE.] "Employee" means an individual 
  8.8   employed for at least ~~20~~ 17-1/2 hours per week and includes a 
  8.9   sole proprietor or a partner of a partnership, if the sole 
  8.10  proprietor or partner is included under a health benefit plan of 
  8.11  the employer, but does not include individuals who work on a 
  8.12  temporary, seasonal, or substitute basis.  "Employee" also 
  8.13  includes a retiree or a handicapped former employee required to 
  8.14  be covered under sections 62A.147 and 62A.148. 
  8.15     Sec. 11.  Minnesota Statutes 2000, section 62L.03, 
  8.16  subdivision 1, is amended to read: 
  8.17     Subdivision 1.  [GUARANTEED ISSUE AND REISSUE.] (a) Every 
  8.18  health carrier shall, as a condition of authority to transact 
  8.19  business in this state in the small employer market, 
  8.20  affirmatively market, offer, sell, issue, and renew any of its 
  8.21  health benefit plans, on a guaranteed issue basis, to any small 
  8.22  employer, including a small employer covered by paragraph (b) or 
  8.23  (c), that meets the participation and contribution requirements 
  8.24  of subdivision 3, as provided in this chapter.  
  8.25     (b) A small employer that has its workforce exceed 50 
  8.26  employees during a plan or policy year has the option to 
  8.27  continue coverage as a small employer or be nonrenewed and seek 
  8.28  replacement coverage in the large employer market. 
  8.29     (c) A small employer that has its workforce reduced to 
  8.30  fewer than two employees may continue coverage as a small 
  8.31  employer for the plan or policy year following the plan or 
  8.32  policy year in which the reduction took place. 
  8.33     (d) Notwithstanding paragraph (a), a health carrier may, at 
  8.34  the time of coverage renewal, modify the health coverage for a 
  8.35  product offered in the small employer market if the modification 
  8.36  is consistent with state law, approved by the commissioner, and 
  9.1   effective on a uniform basis for all small employers purchasing 
  9.2   that product other than through a qualified association in 
  9.3   compliance with section 62L.045, subdivision 2. 
  9.4      Paragraph (a) does not apply to a health benefit plan 
  9.5   designed for a small employer to comply with a collective 
  9.6   bargaining agreement, provided that the health benefit plan 
  9.7   otherwise complies with this chapter and is not offered to other 
  9.8   small employers, except for other small employers that need it 
  9.9   for the same reason.  This paragraph applies only with respect 
  9.10  to collective bargaining agreements entered into prior to August 
  9.11  21, 1996, and only with respect to plan years beginning before 
  9.12  the later of July 1, 1997, or the date upon which the last of 
  9.13  the collective bargaining agreements relating to the plan 
  9.14  terminates determined without regard to any extension agreed to 
  9.15  after August 21, 1996. 
  9.16     ~~(c)~~ (e) Every health carrier participating in the small 
  9.17  employer market shall make available both of the plans described 
  9.18  in section 62L.05 to small employers and shall fully comply with 
  9.19  the underwriting and the rate restrictions specified in this 
  9.20  chapter for all health benefit plans issued to small employers.  
  9.21     ~~(d)~~ (f) A health carrier may cease to transact business in 
  9.22  the small employer market as provided under section 62L.09. 
  9.23     Sec. 12.  Minnesota Statutes 2000, section 62L.03, 
  9.24  subdivision 5, is amended to read: 
  9.25     Subd. 5.  [CANCELLATIONS AND FAILURES TO RENEW.] (a) No 
  9.26  health carrier shall cancel, decline to issue, or fail to renew 
  9.27  a health benefit plan as a result of the claim experience or 
  9.28  health status of the persons covered or to be covered by the 
  9.29  health benefit plan.  For purposes of this subdivision, a 
  9.30  failure to renew does not include a uniform modification of 
  9.31  coverage at time of renewal, as described in subdivision 1. 
  9.32     (b) A health carrier may cancel or fail to renew a health 
  9.33  benefit plan: 
  9.34     (1) for nonpayment of the required premium; 
  9.35     (2) for fraud or misrepresentation by the small employer 
  9.36  with respect to eligibility for coverage or any other material 
 10.1   fact; 
 10.2      (3) if the employer fails to comply with the minimum 
 10.3   contribution percentage required under subdivision 3; or 
 10.4      (4) for any other reasons or grounds expressly permitted by 
 10.5   the respective licensing laws and regulations governing a health 
 10.6   carrier, including, but not limited to, service area 
 10.7   restrictions imposed on health maintenance organizations under 
 10.8   section 62D.03, subdivision 4, paragraph (m), to the extent that 
 10.9   these grounds are not expressly inconsistent with this chapter. 
 10.10     (c) A health carrier may fail to renew a health benefit 
 10.11  plan: 
 10.12     (1) if eligible employee participation during the preceding 
 10.13  calendar year declines to less than 75 percent, subject to the 
 10.14  waiver of coverage provision in subdivision 3; 
 10.15     (2) if the health carrier ceases to do business in the 
 10.16  small employer market under section 62L.09; or 
 10.17     (3) if a failure to renew is based upon the health 
 10.18  carrier's decision to discontinue the health benefit plan form 
 10.19  previously issued to the small employer, but only if the health 
 10.20  carrier permits each small employer covered under the prior form 
 10.21  to switch to its choice of any other health benefit plan offered 
 10.22  by the health carrier, without any underwriting restrictions 
 10.23  that would not have been permitted for renewal purposes. 
 10.24     (d) ~~A health carrier need not renew a health benefit plan,~~ 
 10.25  ~~and shall not renew a small employer plan, if an employer ceases~~ 
 10.26  ~~to qualify as a small employer as defined in section 62L.02.~~  If 
 10.27  a health benefit plan, other than a small employer plan, 
 10.28  provides terms of renewal that do not exclude an employer that 
 10.29  is no longer a small employer, the health benefit plan may be 
 10.30  renewed according to its own terms.  If a health carrier issues 
 10.31  or renews a health plan to an employer that is no longer a small 
 10.32  employer, without interruption of coverage, the health plan is 
 10.33  subject to section 60A.082.  
 10.34     (e) A health carrier may cancel or fail to renew the 
 10.35  coverage of an individual employee or dependent under a health 
 10.36  benefit plan for fraud or misrepresentation by the eligible 
 11.1   employee or dependent with respect to eligibility for coverage 
 11.2   or any other material fact. 
 11.3      Sec. 13.  Minnesota Statutes 2001 Supplement, section 
 11.4   62M.03, subdivision 2, is amended to read: 
 11.5      Subd. 2.  [NONLICENSED UTILIZATION REVIEW ORGANIZATION.] An 
 11.6   organization that meets the definition of a utilization review 
 11.7   organization under section 62M.02, subdivision 21, that is not 
 11.8   licensed in this state that performs utilization review services 
 11.9   for Minnesota residents must register with the commissioner of 
 11.10  commerce and must certify compliance with sections 62M.01 to 
 11.11  62M.16. 
 11.12     Initial registration must occur no later than January 1, 
 11.13  1993.  The registration is effective for two years and may be 
 11.14  renewed ~~for another two years by written request~~.  Applications 
 11.15  for initial and renewal registrations must be made on forms 
 11.16  prescribed by the commissioner.  Each utilization review 
 11.17  organization registered under this chapter shall notify the 
 11.18  commissioner of commerce within 30 days of any change in the 
 11.19  name, address, or ownership of the organization.  The 
 11.20  organization shall pay to the commissioner of commerce a fee of 
 11.21  $1,000 for the initial registration application and $1,000 for 
 11.22  each two-year renewal. 
 11.23     Sec. 14.  Minnesota Statutes 2000, section 62Q.185, is 
 11.24  amended to read: 
 11.25     62Q.185 [GUARANTEED RENEWABILITY; LARGE EMPLOYER GROUP 
 11.26  HEALTH COVERAGE.] 
 11.27     (a) No health plan company, as defined in section 62Q.01, 
 11.28  subdivision 4, shall refuse to renew a health benefit plan, as 
 11.29  defined in section 62L.02, subdivision 15, but issued to a large 
 11.30  employer, as defined in section 62Q.18, subdivision 1. 
 11.31     (b) This section does not require renewal if: 
 11.32     (1) the large employer has failed to pay premiums or 
 11.33  contributions as required under the terms of the health benefit 
 11.34  plan, or the health plan company has not received timely premium 
 11.35  payments unless the late payments were received within a grace 
 11.36  period provided under state law; 
 12.1      (2) the large employer has performed an act or practice 
 12.2   that constitutes fraud or misrepresentation of material fact 
 12.3   under the terms of the health benefit plan; 
 12.4      (3) the large employer has failed to comply with a material 
 12.5   plan provision relating to employer contribution or group 
 12.6   participation rules not prohibited by state law; 
 12.7      (4) the health plan company is ceasing to offer coverage in 
 12.8   the large employer market in this state in compliance with 
 12.9   United States Code, title 42, section 300gg-12(c), and 
 12.10  applicable state law; 
 12.11     (5) in the case of a health maintenance organization, there 
 12.12  is no longer any enrollee in the large employer's health benefit 
 12.13  plan who lives, resides, or works in the approved service area; 
 12.14  or 
 12.15     (6) in the case of a health benefit plan made available to 
 12.16  large employers only through one or more bona fide associations, 
 12.17  the membership of the large employer in the association ceases, 
 12.18  but only if such coverage is terminated uniformly without regard 
 12.19  to any health-related factor relating to any covered individual. 
 12.20     (c) This section does not prohibit a health plan company 
 12.21  from modifying the premium rate or from modifying the coverage 
 12.22  for purposes of renewal. 
 12.23     (d) This section does not require renewal of the coverage 
 12.24  of individual enrollees under the health benefit plan if the 
 12.25  individual enrollee has performed an act or practice that 
 12.26  constitutes fraud or misrepresentation of material fact under 
 12.27  the terms of the health benefit plan. 
 12.28     (e) If a large employer's number of employees decreases 
 12.29  below 51 employees, coverage may be renewed by the employer in 
 12.30  the large employer group health coverage market. 
 12.31     Sec. 15.  Minnesota Statutes 2000, section 79A.04, 
 12.32  subdivision 9, is amended to read: 
 12.33     Subd. 9.  [INSOLVENCY, BANKRUPTCY, OR DEFAULT; UTILIZATION 
 12.34  OF SECURITY DEPOSIT.] The commissioner of labor and industry 
 12.35  shall notify the commissioner and the security fund if the 
 12.36  commissioner of labor and industry has knowledge that any 
 13.1   private self-insurer has failed to pay workers' compensation 
 13.2   benefits as required by chapter 176.  ~~If the commissioner~~ 
 13.3   ~~determines that a private self-insurer is the subject of a~~ 
 13.4   ~~voluntary or involuntary petition under the United States~~ 
 13.5   ~~Bankruptcy Code, title 11, or the commissioner determines that a~~ 
 13.6   ~~court of competent jurisdiction has declared the private~~ 
 13.7   ~~self-insurer to be bankrupt or insolvent, and the private~~ 
 13.8   ~~self-insurer has failed to pay workers' compensation as required~~ 
 13.9   ~~by chapter 176 or, if the commissioner issues a certificate of~~ 
 13.10  ~~default against a private self-insurer for failure to pay~~ 
 13.11  ~~workers' compensation as required by chapter 176, or failure to~~ 
 13.12  ~~pay an assessment to the self-insurers' security fund when due,~~ 
 13.13  ~~then the security deposit shall be utilized to administer and~~ 
 13.14  ~~pay the private self-insurers' workers' compensation or~~ 
 13.15  ~~assessment obligations or any other current or future~~ 
 13.16  ~~obligations of the self-insurers' security fund.~~  The security 
 13.17  deposit shall be used to administer and pay the private 
 13.18  self-insurers' workers' compensation or assessment obligations 
 13.19  or any other current or future obligations of the self-insurers' 
 13.20  security fund if any of the following occurs: 
 13.21     (1) the private self-insurer has failed to pay workers' 
 13.22  compensation as required by chapter 176 and either: 
 13.23     (a) the commissioner determines that a private self-insurer 
 13.24  is the subject of a voluntary or involuntary petition under the 
 13.25  United States Bankruptcy Code, title 11; or 
 13.26     (b) the commissioner determines that a court of competent 
 13.27  jurisdiction has declared the private self-insurer to be 
 13.28  bankrupt or insolvent; or 
 13.29     (2) the commissioner issues a certificate of default 
 13.30  against a private self-insurer for failure to pay workers' 
 13.31  compensation as required by chapter 176; or 
 13.32     (3) the commissioner issues a certificate of default 
 13.33  against a private self-insurer for failure to pay an assessment 
 13.34  to the self-insurer's security fund when due. 
 13.35     Sec. 16.  Laws 2001, chapter 117, article 1, section 29, is 
 13.36  amended to read: 
 14.1      Sec. 29.  [EFFECTIVE DATE; APPLICATION.] 
 14.2      Sections 1 to 28 are effective July 1, 2002, and apply to 
 14.3   persons who sell, solicit, or negotiate insurance in this state 
 14.4   for any class or classes of insurance on or after that date.  
 14.5   However, a person required to be licensed under Minnesota 
 14.6   Statutes, chapter 60K, who holds a valid license under Minnesota 
 14.7   Statutes 2000, sections 60K.01 to 60K.20, on July 1, 2002, may 
 14.8   continue to sell, solicit, or negotiate insurance in this state 
 14.9   under the authority of that license.  Upon the expiration of 
 14.10  that license, the person shall not sell, solicit, or negotiate 
 14.11  insurance in this state for any class or classes of insurance 
 14.12  unless the person is licensed in that line of authority under 
 14.13  Minnesota Statutes, chapter 60K.