1.1                          A bill for an act 
  1.2             relating to Minnesota Comprehensive Health 
  1.3             Association; authorizing enrollee incentives for 
  1.4             participation in a disease management program; phasing 
  1.5             out Medicare-extended basic supplement plans; 
  1.6             modifying eligibility requirements; amending Minnesota 
  1.7             Statutes 2002, sections 62E.10, subdivisions 2, 10; 
  1.8             62E.141; Minnesota Statutes 2003 Supplement, section 
  1.9             62E.12. 
  1.10  BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  1.11     Section 1.  Minnesota Statutes 2002, section 62E.10, 
  1.12  subdivision 2, is amended to read: 
  1.13     Subd. 2.  [BOARD OF DIRECTORS; ORGANIZATION.] The board of 
  1.14  directors of the association shall be made up of ~~nine~~ ten 
  1.15  members as follows:  five directors selected by contributing 
  1.16  members, subject to approval by the commissioner, one of whom 
  1.17  must be a health actuary; ~~four~~ five public directors selected by 
  1.18  the commissioner, at least two of whom must be plan 
  1.19  enrollees and two of whom must be representatives of employers 
  1.20  whose accident and health insurance premiums are part of the 
  1.21  association's assessment base.  At least two of the public 
  1.22  directors shall reside outside of the seven-county metropolitan 
  1.23  area.  Public members ~~may~~ must include one licensed insurance 
  1.24  ~~agents~~ agent.  In determining voting rights at members' 
  1.25  meetings, each member shall be entitled to vote in person or 
  1.26  proxy.  The vote shall be a weighted vote based upon the 
  1.27  member's cost of self-insurance, accident and health insurance 
  2.1   premium, subscriber contract charges, health maintenance 
  2.2   contract payment, or community integrated service network 
  2.3   payment derived from or on behalf of Minnesota residents in the 
  2.4   previous calendar year, as determined by the commissioner.  In 
  2.5   approving directors of the board, the commissioner shall 
  2.6   consider, among other things, whether all types of members are 
  2.7   fairly represented.  Directors selected by contributing members 
  2.8   may be reimbursed from the money of the association for expenses 
  2.9   incurred by them as directors, but shall not otherwise be 
  2.10  compensated by the association for their services.  The costs of 
  2.11  conducting meetings of the association and its board of 
  2.12  directors shall be borne by members of the association. 
  2.13     <b>[EFFECTIVE DATE.]</b> This section is effective July 1, 2004. 
  2.14     Sec. 2.  Minnesota Statutes 2002, section 62E.10, 
  2.15  subdivision 10, is amended to read: 
  2.16     Subd. 10.  [COST CONTAINMENT GOALS.] (a) By July 1, 2001, 
  2.17  the association shall investigate managed care delivery systems, 
  2.18  and if cost effective, enter into contracts with third-party 
  2.19  entities as provided in section 62E.101. 
  2.20     (b) By July 1, 2001, the association shall establish a 
  2.21  system to annually identify individuals insured by the Minnesota 
  2.22  Comprehensive Health Association who may be eligible for private 
  2.23  health care coverage, medical assistance, state drug programs, 
  2.24  or other state or federal programs and notify them about their 
  2.25  eligibility for these programs. 
  2.26     (c) The association shall endeavor to reduce health care 
  2.27  costs using additional methods consistent with effective patient 
  2.28  care.  At a minimum, by July 1, 2001, the association shall: 
  2.29     (1) develop a focused chronic disease management and case 
  2.30  management program; 
  2.31     (2) develop a comprehensive program of preventive care; and 
  2.32     (3) implement a total drug formulary program. 
  2.33     The association may provide an incentive for enrollee 
  2.34  participation in the chronic disease management and case 
  2.35  management program developed under this section.  
  2.36     Sec. 3.  Minnesota Statutes 2003 Supplement, section 
  3.1   62E.12, is amended to read: 
  3.2      62E.12 [MINIMUM BENEFITS OF COMPREHENSIVE HEALTH INSURANCE 
  3.3   PLAN.] 
  3.4      (a) The association through its comprehensive health 
  3.5   insurance plan shall offer policies which provide the benefits 
  3.6   of a number one qualified plan and a number two qualified plan, 
  3.7   except that the maximum lifetime benefit on these plans shall be 
  3.8   $2,800,000; and an extended basic Medicare supplement plan and a 
  3.9   basic Medicare supplement plan as described in sections 62A.31 
  3.10  to 62A.44.  The association may also offer a plan that is 
  3.11  identical to a number one and number two qualified plan except 
  3.12  that it has a $2,000 annual deductible and a $2,800,000 maximum 
  3.13  lifetime benefit.  The association, subject to the approval of 
  3.14  the commissioner, may also offer plans that are identical to the 
  3.15  number one or number two qualified plan, except that they have 
  3.16  annual deductibles of $5,000 and $10,000, respectively; have 
  3.17  limitations on total annual out-of-pocket expenses equal to 
  3.18  those annual deductibles and therefore cover 100 percent of the 
  3.19  allowable cost of covered services in excess of those annual 
  3.20  deductibles; and have a $2,800,000 maximum lifetime benefit.  As 
  3.21  of January 1, 2006, the association shall no longer be required 
  3.22  to offer an extended basic Medicare supplement plan.  
  3.23     (b) The requirement that a policy issued by the association 
  3.24  must be a qualified plan is satisfied if the association 
  3.25  contracts with a preferred provider network and the level of 
  3.26  benefits for services provided within the network satisfies the 
  3.27  requirements of a qualified plan.  If the association uses a 
  3.28  preferred provider network, payments to nonparticipating 
  3.29  providers must meet the minimum requirements of section 72A.20, 
  3.30  subdivision 15.  
  3.31     (c) The association shall offer health maintenance 
  3.32  organization contracts in those areas of the state where a 
  3.33  health maintenance organization has agreed to make the coverage 
  3.34  available and has been selected as a writing carrier.  
  3.35     (d) Notwithstanding the provisions of section 62E.06 and 
  3.36  unless those charges are billed by a provider that is part of 
  4.1   the association's preferred provider network, the state plan 
  4.2   shall exclude coverage of services of a private duty nurse other 
  4.3   than on an inpatient basis and any charges for treatment in a 
  4.4   hospital located outside of the state of Minnesota in which the 
  4.5   covered person is receiving treatment for a mental or nervous 
  4.6   disorder, unless similar treatment for the mental or nervous 
  4.7   disorder is medically necessary, unavailable in Minnesota and 
  4.8   provided upon referral by a licensed Minnesota medical 
  4.9   practitioner. 
  4.10     Sec. 4.  Minnesota Statutes 2002, section 62E.141, is 
  4.11  amended to read: 
  4.12     62E.141 [INCLUSION IN EMPLOYER-SPONSORED PLAN.] 
  4.13     (a) No employee of an employer that offers a health plan, 
  4.14  under which the employee is eligible for coverage, is eligible 
  4.15  to enroll, or continue to be enrolled, in the comprehensive 
  4.16  health association, except for enrollment or continued 
  4.17  enrollment necessary to cover conditions that are subject to an 
  4.18  unexpired preexisting condition limitation, preexisting 
  4.19  condition exclusion, or exclusionary rider under the employer's 
  4.20  health plan.  This ~~section~~ paragraph does not apply to persons 
  4.21  enrolled in the Comprehensive Health Association as of June 30, 
  4.22  ~~1993~~ 2004.  With respect to persons eligible to enroll in the 
  4.23  health plan of an employer that has more than 29 current 
  4.24  employees, as defined in section 62L.02, this ~~section~~ paragraph 
  4.25  does not apply to persons enrolled in the Comprehensive Health 
  4.26  Association as of December 31, 1994. 
  4.27     (b) Paragraph (a) applies to an employee's dependents if 
  4.28  the employer offers dependent coverage and the dependent is 
  4.29  eligible for coverage but does not apply to persons enrolled in 
  4.30  the Comprehensive Health Association as of June 30, 2004. 
  4.31     Sec. 5.  [PRESUMPTIVE CONDITIONS STUDY.] 
  4.32     The Minnesota Comprehensive Health Association, in 
  4.33  consultation with the commissioner of commerce, shall contract 
  4.34  with an independent entity to conduct an analysis of the 
  4.35  eligibility standards used for enrollment for coverage under the 
  4.36  Minnesota Comprehensive Health Association in terms of the use 
  5.1   of presumptive conditions for automatic eligibility and the 
  5.2   underwriting practices for the individual market regarding the 
  5.3   denial or limitations of coverage due to preexisting 
  5.4   conditions.  The analysis must compare the Minnesota 
  5.5   Comprehensive Health Association's practices with that of other 
  5.6   states' high-risk pools and examine the basis for denials within 
  5.7   the individual market.  The analysis must also determine whether 
  5.8   there should be additional guidelines or standards in place 
  5.9   before the existence of a specific condition or diagnosis is 
  5.10  deemed automatically eligible for coverage under the Minnesota 
  5.11  Comprehensive Health Association.  
  5.12     The commissioner of commerce shall submit the results of 
  5.13  the study and any recommendations to the legislature by January 
  5.14  15, 2005. 
  5.15     The Minnesota Comprehensive Health Association must also 
  5.16  contract for claims analysis and evaluation of its current 
  5.17  disease management and quality measurement function.