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CHAPTER 62D. HEALTH MAINTENANCE ORGANIZATIONS

Table of Sections
SectionHeadnote
62D.001APPLICATION OF LAWS 2005, CHAPTER 56, TERMINOLOGY CHANGES.
62D.01CITATION AND PURPOSE.
62D.02DEFINITIONS.
62D.03ESTABLISHMENT OF HEALTH MAINTENANCE ORGANIZATIONS.
62D.04ISSUANCE OF CERTIFICATE AUTHORITY.
62D.041PROTECTION IN THE EVENT OF INSOLVENCY.
62D.042INITIAL NET WORTH REQUIREMENT.
62D.043Repealed, 2004 c 285 art 3 s 11
62D.044ADMITTED ASSETS.
62D.045INVESTMENT RESTRICTIONS.
62D.05POWERS OF HEALTH MAINTENANCE ORGANIZATIONS.
62D.06GOVERNING BODY.
62D.07EVIDENCE OF COVERAGE; REQUIRED TERMS.
62D.08ANNUAL REPORT.
62D.09INFORMATION TO ENROLLEES.
62D.095ENROLLEE COST SHARING.
62D.10PROVISIONS APPLICABLE TO ALL HEALTH PLANS.
62D.101CONTINUATION AND CONVERSION PRIVILEGES FOR FORMER SPOUSES AND CHILDREN.
62D.102FAMILY THERAPY.
62D.103SECOND OPINION RELATED TO CHEMICAL DEPENDENCY AND MENTAL HEALTH.
62D.104REQUIRED OUT-OF-AREA CONVERSION.
62D.105COVERAGE OF CURRENT SPOUSE AND CHILDREN.
62D.106Repealed, 1995 c 207 art 10 s 25
62D.108Repealed, 2000 c 349 s 2
62D.109SERVICES ASSOCIATED WITH CLINICAL TRIALS.
62D.11COMPLAINT SYSTEM.
62D.12PROHIBITED PRACTICES.
62D.121REQUIRED REPLACEMENT COVERAGE.
62D.122Repealed, 1988 c 434 s 24; 1990 c 538 s 31
62D.123PROVIDER CONTRACTS.
62D.124GEOGRAPHIC ACCESSIBILITY.
62D.13POWERS OF INSURERS AND NONPROFIT HEALTH SERVICE PLANS.
62D.14EXAMINATIONS.
62D.145DISCLOSURE OF INFORMATION HELD BY HEALTH MAINTENANCE ORGANIZATIONS.
62D.15SUSPENSION OR REVOCATION OF CERTIFICATE OF AUTHORITY.
62D.16DENIAL, SUSPENSION, AND REVOCATION; ADMINISTRATIVE PROCEDURES.
62D.17PENALTIES AND ENFORCEMENT.
62D.18REHABILITATION OR LIQUIDATION OF HEALTH MAINTENANCE ORGANIZATION.
62D.181INSOLVENCY; MCHA ALTERNATIVE COVERAGE.
62D.182LIABILITIES.
62D.19UNREASONABLE EXPENSES.
62D.20RULES.
62D.21FEES.
62D.211RENEWAL FEE.
62D.22STATUTORY CONSTRUCTION AND RELATIONSHIP TO OTHER LAWS.
62D.23FILINGS AND REPORTS AS PUBLIC DOCUMENTS.
62D.24STATE COMMISSIONER OF HEALTH'S AUTHORITY TO CONTRACT.
62D.25Repealed, 1Sp1985 c 9 art 2 s 104
62D.26Repealed, 1Sp1985 c 9 art 2 s 104
62D.27Repealed, 1984 c 464 s 46
62D.28Repealed, 1Sp1985 c 9 art 2 s 104
62D.29Repealed, 1Sp1985 c 9 art 2 s 104
62D.30DEMONSTRATION PROJECTS.
62D.001 APPLICATION OF LAWS 2005, CHAPTER 56, TERMINOLOGY CHANGES.
State agencies shall use the terminology changes specified in Laws 2005, chapter 56, section
1, when printed material and signage are replaced and new printed material and signage are
obtained. State agencies do not have to replace existing printed material and signage to comply
with Laws 2005, chapter 56, sections 1 and 2. Language changes made according to Laws 2005,
chapter 56, sections 1 and 2, shall not expand or exclude eligibility to services.
History: 2005 c 56 s 3
62D.01 CITATION AND PURPOSE.
    Subdivision 1. Title. Sections 62D.01 to 62D.24 may be cited as the "Health Maintenance
Act of 1973."
    Subd. 2. Legislative findings and intent; policy. (a) Faced with the continuation of
mounting costs of health care coupled with its inaccessibility to large segments of the population,
the legislature has determined that there is a need to explore alternative methods for the delivery
of health care services, with a view toward achieving greater efficiency and economy in providing
these services.
(b) It is, therefore, the policy of the state to eliminate the barriers to the organization,
promotion, and expansion of health maintenance organizations; to provide for their regulation by
the state commissioner of health; and to exempt them from the operation of the insurance and
nonprofit health service plan corporation laws of the state except as hereinafter provided.
(c) It is further the intention of the legislature to closely monitor the development of health
maintenance organizations in order to assess their impact on the costs of health care to consumers,
the accessibility of health care to consumers, and the quality of health care provided to consumers.
History: 1973 c 670 s 1; 1977 c 305 s 45; 1996 c 305 art 1 s 139
62D.02 DEFINITIONS.
    Subdivision 1. Applicability. For the purposes of sections 62D.01 to 62D.30, unless the
context clearly indicates otherwise, the terms defined in this section shall have the meaning
here given them.
    Subd. 2.[Repealed, 1990 c 538 s 32]
    Subd. 3. Commissioner of health or commissioner. "Commissioner of health" or
"commissioner" means the state commissioner of health or a designee.
    Subd. 4. Health maintenance organization. (a) "Health maintenance organization" means
a nonprofit corporation organized under chapter 317A, or a local governmental unit as defined
in subdivision 11, controlled and operated as provided in sections 62D.01 to 62D.30, which
provides, either directly or through arrangements with providers or other persons, comprehensive
health maintenance services, or arranges for the provision of these services, to enrollees on the
basis of a fixed prepaid sum without regard to the frequency or extent of services furnished
to any particular enrollee.
(b) [Expired]
    Subd. 5. Evidence of coverage. "Evidence of coverage" means any certificate, agreement or
contract, and amendments thereto, issued to an enrollee which sets out the coverage to which the
enrollee is entitled under the health maintenance contract which covers the enrollee.
    Subd. 6. Enrollee. "Enrollee" means any person who has entered into, or is covered by, a
health maintenance contract.
    Subd. 7. Comprehensive health maintenance services. "Comprehensive health
maintenance services" means a set of comprehensive health services which the enrollees might
reasonably require to be maintained in good health including as a minimum, but not limited
to, emergency care, emergency ground ambulance transportation services, inpatient hospital
and physician care, outpatient health services and preventive health services. Elective, induced
abortion, except as medically necessary to prevent the death of the mother, whether performed
in a hospital, other abortion facility or the office of a physician, shall not be mandatory for any
health maintenance organization.
    Subd. 8. Health maintenance contract. "Health maintenance contract" means any contract
whereby a health maintenance organization agrees to provide to enrollees comprehensive health
maintenance services and any other health care service set forth in the contract. The contract
may contain enrollee cost-sharing provisions if the provisions meet the requirements of section
62D.095.
    Subd. 9. Provider. "Provider" means any person who furnishes health services and is
licensed or otherwise authorized to render such services in the state.
    Subd. 10. Consumer. "Consumer" means any person, including an enrollee, to whom a
health maintenance organization directs marketing materials.
    Subd. 11. Local governmental unit. "Local governmental unit" means any statutory
or home rule charter city or county.
    Subd. 12. Participating entity. "Participating entity" means any of the following persons,
providers, companies, or other organizations with which the health maintenance organization
has contracts or other agreements:
(1) a health care facility licensed under sections 144.50 to 144.56, a nursing home licensed
under sections 144A.02 to 144A.11, and any other health care facility otherwise licensed under
the laws of this state or registered with the commissioner of health;
(2) a health care professional licensed under health-related licensing boards, as defined in
section 214.01, subdivision 2, and any other health care professional otherwise licensed under the
laws of this state or registered with the commissioner of health;
(3) a group, professional corporation, or other organization which provides the services of
individuals or entities identified in (2), including but not limited to a medical clinic, a medical
group, a home health care agency, an urgent care center, and an emergent care center;
(4) any person or organization providing administrative, financial, or management services
to the health maintenance organization if the total payment for all services exceeds three percent
of the gross revenues of the health maintenance organization.
"Participating entity" does not include (a) another health maintenance organization with
which a health maintenance organization has made contractual arrangements or (b) any entity
with which a health maintenance organization has contracted primarily in order to purchase
or lease equipment or space or (c) employees of the health maintenance organization or (d)
employees of any participating entity identified in clause (3).
    Subd. 13. Major participating entity. "Major participating entity" shall include the
following:
(1) a participating entity that receives from the health maintenance organization as
compensation for services a sum greater than 30 percent of the health maintenance organization's
gross annual revenues;
(2) a participating entity providing administrative, financial, or management services to the
health maintenance organization, if the total payment for all services provided by the participating
entity exceeds three percent of the gross revenue of the health maintenance organization;
(3) a participating entity that nominates or appoints 30 percent or more of the board of
directors of the health maintenance organization.
    Subd. 14. Separate health services contracts. "Separate health services contracts" means
prepaid dental services contracts and other similar types of prepaid health services agreements
in which services are provided by participating entities or employees of the health maintenance
organization, but does not include contracts subject to chapter 62A or 62C.
    Subd. 15. Net worth. "Net worth" means admitted assets, as defined in section 62D.044,
minus liabilities. Liabilities do not include those obligations that are subordinated in the same
manner as preferred ownership claims under section 60B.44, subdivision 10. For purposes of this
subdivision, preferred ownership claims under section 60B.44, subdivision 10, include promissory
notes subordinated to all other liabilities of the health maintenance organization.
    Subd. 16. Affiliate. "Affiliate" means a person or entity controlling, controlled by, or under
common control with the person or entity.
History: 1973 c 670 s 2; 1974 c 284 s 1; 1977 c 305 s 45; 1981 c 122 s 1; 1983 c 205 s
1,2; 1983 c 289 s 114 subd 1; 1984 c 464 s 8-11; 1984 c 655 art 1 s 92; 1986 c 444; 1987 c 384
art 2 s 1; 1988 c 612 s 1,2; 1989 c 304 s 137; 1990 c 538 s 12,13; 1993 c 50 s 1; 1994 c 625
art 8 s 5; 1995 c 234 art 7 s 6; 1995 c 258 s 39; 1996 c 305 art 1 s 18; 1997 c 205 s 1; 1997 c
225 art 2 s 6; 2002 c 387 s 2
62D.03 ESTABLISHMENT OF HEALTH MAINTENANCE ORGANIZATIONS.
    Subdivision 1. Certificate of authority required. Notwithstanding any law of this state to
the contrary, any nonprofit corporation organized to do so or a local governmental unit may
apply to the commissioner of health for a certificate of authority to establish and operate a health
maintenance organization in compliance with sections 62D.01 to 62D.30. No person shall
establish or operate a health maintenance organization in this state, nor sell or offer to sell, or
solicit offers to purchase or receive advance or periodic consideration in conjunction with a health
maintenance organization or health maintenance contract unless the organization has a certificate
of authority under sections 62D.01 to 62D.30.
    Subd. 2.[Repealed, 1997 c 205 s 40]
    Subd. 3. Required application. The commissioner of health may require any person
providing physician and hospital services with payments made in the manner set forth in section
62D.02, subdivision 4, to apply for a certificate of authority under sections 62D.01 to 62D.30. An
applicant may continue to operate until the commissioner of health acts upon the application.
In the event that an application is denied, the applicant shall henceforth be treated as a health
maintenance organization whose certificate of authority has been revoked. Any person directed to
apply for a certificate of authority shall be subject to the provisions of this subdivision.
    Subd. 4. Application requirements. Each application for a certificate of authority shall
be verified by an officer or authorized representative of the applicant, and shall be in a form
prescribed by the commissioner of health. Each application shall include the following:
(a) a copy of the basic organizational document, if any, of the applicant and of each major
participating entity; such as the articles of incorporation, or other applicable documents, and all
amendments thereto;
(b) a copy of the bylaws, rules and regulations, or similar document, if any, and all
amendments thereto which regulate the conduct of the affairs of the applicant and of each major
participating entity;
(c) a list of the names, addresses, and official positions of the following:
(1) all members of the board of directors, or governing body of the local government unit,
and the principal officers and shareholders of the applicant organization; and
(2) all members of the board of directors, or governing body of the local government unit,
and the principal officers of the major participating entity and each shareholder beneficially
owning more than ten percent of any voting stock of the major participating entity;
The commissioner may by rule identify persons included in the term "principal officers";
(d) a full disclosure of the extent and nature of any contract or financial arrangements
between the following:
(1) the health maintenance organization and the persons listed in clause (c)(1);
(2) the health maintenance organization and the persons listed in clause (c)(2);
(3) each major participating entity and the persons listed in clause (c)(1) concerning any
financial relationship with the health maintenance organization; and
(4) each major participating entity and the persons listed in clause (c)(2) concerning any
financial relationship with the health maintenance organization;
(e) the name and address of each participating entity and the agreed upon duration of each
contract or agreement;
(f) a copy of the form of each contract binding the participating entities and the health
maintenance organization. Contractual provisions shall be consistent with the purposes of sections
62D.01 to 62D.30, in regard to the services to be performed under the contract, the manner in
which payment for services is determined, the nature and extent of responsibilities to be retained
by the health maintenance organization, the nature and extent of risk sharing permissible, and
contractual termination provisions;
(g) a copy of each contract binding major participating entities and the health maintenance
organization. Contract information filed with the commissioner shall be confidential and subject
to the provisions of section 13.37, subdivision 1, clause (b), upon the request of the health
maintenance organization.
Upon initial filing of each contract, the health maintenance organization shall file a separate
document detailing the projected annual expenses to the major participating entity in performing
the contract and the projected annual revenues received by the entity from the health maintenance
organization for such performance. The commissioner shall disapprove any contract with a major
participating entity if the contract will result in an unreasonable expense under section 62D.19.
The commissioner shall approve or disapprove a contract within 30 days of filing.
Within 120 days of the anniversary of the implementation of each contract, the health
maintenance organization shall file a document detailing the actual expenses incurred and
reported by the major participating entity in performing the contract in the preceding year and
the actual revenues received from the health maintenance organization by the entity in payment
for the performance;
(h) a statement generally describing the health maintenance organization, its health
maintenance contracts and separate health service contracts, facilities, and personnel, including
a statement describing the manner in which the applicant proposes to provide enrollees with
comprehensive health maintenance services and separate health services;
(i) a copy of the form of each evidence of coverage to be issued to the enrollees;
(j) a copy of the form of each individual or group health maintenance contract and each
separate health service contract which is to be issued to enrollees or their representatives;
(k) financial statements showing the applicant's assets, liabilities, and sources of financial
support. If the applicant's financial affairs are audited by independent certified public accountants,
a copy of the applicant's most recent certified financial statement may be deemed to satisfy
this requirement;
(l) a description of the proposed method of marketing the plan, a schedule of proposed
charges, and a financial plan which includes a three-year projection of the expenses and income
and other sources of future capital;
(m) a statement reasonably describing the geographic area or areas to be served and the type
or types of enrollees to be served;
(n) a description of the complaint procedures to be utilized as required under section 62D.11;
(o) a description of the procedures and programs to be implemented to meet the requirements
of section 62D.04, subdivision 1, clauses (b) and (c) and to monitor the quality of health care
provided to enrollees;
(p) a description of the mechanism by which enrollees will be afforded an opportunity to
participate in matters of policy and operation under section 62D.06;
(q) a copy of any agreement between the health maintenance organization and an insurer
or nonprofit health service corporation regarding reinsurance, stop-loss coverage, insolvency
coverage, or any other type of coverage for potential costs of health services, as authorized in
sections 62D.04, subdivision 1, clause (f), 62D.05, subdivision 3, and 62D.13;
(r) a copy of the conflict of interest policy which applies to all members of the board of
directors and the principal officers of the health maintenance organization, as described in section
62D.04, subdivision 1, paragraph (g). All currently licensed health maintenance organizations
shall also file a conflict of interest policy with the commissioner within 60 days after August 1,
1990, or at a later date if approved by the commissioner;
(s) a copy of the statement that describes the health maintenance organization's prior
authorization administrative procedures; and
(t) other information as the commissioner of health may reasonably require to be provided.
History: 1973 c 670 s 3; 1977 c 305 s 45; 1983 c 205 s 3,4; 1984 c 464 s 12; 1984 c 641 s
2; 1985 c 248 s 21,22; 1987 c 384 art 2 s 1; 1988 c 612 s 3; 1990 c 538 s 14; 1997 c 205 s
2,3; 2006 c 212 art 3 s 2
62D.04 ISSUANCE OF CERTIFICATE AUTHORITY.
    Subdivision 1. Application review. Upon receipt of an application for a certificate of
authority, the commissioner of health shall determine whether the applicant for a certificate
of authority has:
(a) demonstrated the willingness and potential ability to assure that health care services will
be provided in such a manner as to enhance and assure both the availability and accessibility of
adequate personnel and facilities;
(b) arrangements for an ongoing evaluation of the quality of health care;
(c) a procedure to develop, compile, evaluate, and report statistics relating to the cost of its
operations, the pattern of utilization of its services, the quality, availability and accessibility of its
services, and such other matters as may be reasonably required by regulation of the commissioner
of health;
(d) reasonable provisions for emergency and out of area health care services;
(e) demonstrated that it is financially responsible and may reasonably be expected to meet its
obligations to enrollees and prospective enrollees. In making this determination, the commissioner
of health shall require the amount of initial net worth required in section 62D.042, compliance
with the risk-based capital standards under sections 60A.50 to 60A.592, the deposit required in
section 62D.041, and in addition shall consider:
(1) the financial soundness of its arrangements for health care services and the proposed
schedule of charges used in connection therewith;
(2) arrangements which will guarantee for a reasonable period of time the continued
availability or payment of the cost of health care services in the event of discontinuance of the
health maintenance organization; and
(3) agreements with providers for the provision of health care services;
(f) demonstrated that it will assume full financial risk on a prospective basis for the provision
of comprehensive health maintenance services, including hospital care; provided, however, that
the requirement in this paragraph shall not prohibit the following:
(1) a health maintenance organization from obtaining insurance or making other
arrangements (i) for the cost of providing to any enrollee comprehensive health maintenance
services, the aggregate value of which exceeds $5,000 in any year, (ii) for the cost of providing
comprehensive health care services to its members on a nonelective emergency basis, or while
they are outside the area served by the organization, or (iii) for not more than 95 percent of the
amount by which the health maintenance organization's costs for any of its fiscal years exceed 105
percent of its income for such fiscal years; and
(2) a health maintenance organization from having a provision in a group health maintenance
contract allowing an adjustment of premiums paid based upon the actual health services
utilization of the enrollees covered under the contract, except that at no time during the life of
the contract shall the contract holder fully self-insure the financial risk of health care services
delivered under the contract. Risk sharing arrangements shall be subject to the requirements of
sections 62D.01 to 62D.30;
(g) demonstrated that it has made provisions for and adopted a conflict of interest policy
applicable to all members of the board of directors and the principal officers of the health
maintenance organization. The conflict of interest policy shall include the procedures described
in section 317A.255, subdivisions 1 and 2. However, the commissioner is not precluded from
finding that a particular transaction is an unreasonable expense as described in section 62D.19
even if the directors follow the required procedures; and
(h) otherwise met the requirements of sections 62D.01 to 62D.30.
    Subd. 2. Issuance; notice. Within 90 days after the receipt of the application for a certificate
of authority, the commissioner of health shall determine whether or not the applicant meets the
requirements of this section. If the commissioner of health determines that the applicant meets
the requirements of sections 62D.01 to 62D.30, the commissioner shall issue a certificate of
authority to the applicant. If the commissioner of health determines that the applicant is not
qualified, the commissioner shall so notify the applicant and shall specify the reason or reasons
for such disqualification.
    Subd. 3. Use of terms. Except as provided in section 62D.03, subdivision 2, no person
who has not been issued a certificate of authority shall use the words "health maintenance
organization" or the initials "HMO" in its name, contracts or literature. Provided, however, that
persons who are operating under a contract with, operating in association with, enrolling enrollees
for, or otherwise authorized by a health maintenance organization licensed under sections 62D.01
to 62D.30 to act on its behalf may use the terms "health maintenance organization" or "HMO" for
the limited purpose of denoting or explaining their association or relationship with the authorized
health maintenance organization. No health maintenance organization which has a minority of
enrollees and members elected according to section 62D.06, subdivision 1, as members of its
board of directors shall use the words "consumer controlled" in its name or in any way represent
to the public that it is controlled by consumers.
    Subd. 4. Continued compliance. Upon being granted a certificate of authority to operate
as a health maintenance organization, the organization must continue to operate in compliance
with the standards set forth in subdivision 1. Noncompliance may result in the imposition of a
fine or the suspension or revocation of the certificate of authority, in accordance with sections
62D.15 to 62D.17.
    Subd. 5. Participation; government programs. Health maintenance organizations shall,
as a condition of receiving and retaining a certificate of authority, participate in the medical
assistance, general assistance medical care, and MinnesotaCare programs. A health maintenance
organization is required to submit proposals in good faith that meet the requirements of the request
for proposal provided that the requirements can be reasonably met by a health maintenance
organization to serve individuals eligible for the above programs in a geographic region of the
state if, at the time of publication of a request for proposal, the percentage of recipients in the
public programs in the region who are enrolled in the health maintenance organization is less than
the health maintenance organization's percentage of the total number of individuals enrolled in
health maintenance organizations in the same region. Geographic regions shall be defined by the
commissioner of human services in the request for proposals.
History: 1973 c 670 s 4; 1977 c 305 s 45; 1984 c 464 s 13; 1985 c 248 s 23; 1986 c 444;
1987 c 130 s 1; 1987 c 384 art 2 s 1; 1988 c 612 s 4; 1990 c 538 s 15; 1994 c 625 art 8 s 6; 1996
c 451 art 5 s 1; 1997 c 203 art 4 s 1; 1997 c 205 s 4; 2004 c 285 art 3 s 3
62D.041 PROTECTION IN THE EVENT OF INSOLVENCY.
    Subdivision 1. Definition. (a) For the purposes of this section, the term "uncovered
expenditures" means the costs of health care services that are covered by a health maintenance
organization for which an enrollee would also be liable in the event of the organization's
insolvency, and that are not guaranteed, insured, or assumed by a person other than the health
maintenance organization.
(b) For purposes of this section, if a health maintenance organization offers supplemental
benefits as described in section 62D.05, subdivision 6, "uncovered expenditures" excludes any
expenditures attributable to the supplemental benefit.
    Subd. 2. Required deposit. Each health maintenance organization shall deposit with any
organization or trustee acceptable to the commissioner through which a custodial or controlled
account is utilized, bankable funds in the amount required in this section. The commissioner may
allow a health maintenance organization's deposit requirement to be funded by an organization
approved by the commissioner.
    Subd. 3. Amount for beginning organizations. (a) Organizations that obtain a certificate of
authority after April 25, 1988, shall deposit, before receiving a certificate of authority, $500,000.
The health maintenance organization shall provide the commissioner with evidence of the deposit
before receiving a certificate of authority.
(b) By April 1 of the year following the organization's first 12 months of operation under a
certificate of authority, an organization shall deposit an amount equal to the difference between
the initial deposit and 33 percent of its uncovered expenditures in its first 12 months of operation.
(c) By April 1 of subsequent years, an organization shall deposit an amount equal to the
difference between the amount on deposit and 33 percent of its uncovered expenditures in the
preceding calendar year.
    Subd. 4. Amount for existing organizations. By December 31, 1989, an organization
that has received a certificate of authority on or before April 25, 1988, shall have on deposit an
amount equal to the larger of:
(a) 33 percent of its uncovered expenditures in the preceding calendar year; or
(b) $500,000.
By April 1 of each subsequent year, an organization shall deposit an amount equal to the
difference between the amount on deposit and 33 percent of its uncovered expenditures in the
preceding calendar year.
    Subd. 5.[Repealed, 1988 c 612 s 32]
    Subd. 5a. Waiver of additional deposit. In any year when the amount determined according
to this section is zero or less than zero, the commissioner shall not require the organization to
make any additional deposit.
    Subd. 6.[Repealed, 1988 c 612 s 32]
    Subd. 6a. Withdrawal of deposit. If the amount previously deposited by the organization
under this section exceeds the amount required under this section by more than $50,000 for a
continuous 12-month period, the commissioner shall allow the organization to withdraw the
portion of the deposit that exceeds by more than $50,000 the amount required to be on deposit for
the organization, unless the commissioner determines that release of a portion of the deposit could
be hazardous to enrollees, creditors, or the general public. An organization shall not apply for the
withdrawal more than once in each calendar year.
    Subd. 6b. Evidence of deposit. An organization shall provide the commissioner with
evidence of every deposit made on or before the date of the deposit.
    Subd. 7. Control of over deposits. All income from deposits shall belong to the depositing
organizations and shall be paid to it as it becomes available.
    Subd. 8.[Repealed, 1988 c 612 s 32]
    Subd. 9. Letter of credit. A health maintenance organization may satisfy one-half of its
deposit requirement through use of a letter of credit issued by a bank authorized to do business
in this state, provided that:
(1) nothing more than a demand for payment is necessary for payment;
(2) the letter of credit is irrevocable;
(3) according to its terms, the letter of credit cannot expire without due notice from the issuer
and the notice must occur at least 60 days before the expiration date and be in the form of a
written notice to the commissioner;
(4) the letter of credit is issued or confirmed by a bank which is a member of the Federal
Reserve system;
(5) the letter of credit is unconditional, is not contingent upon reimbursement to the bank
or the bank's ability to perfect any lien or security interest, and does not contain references to
any other agreements, documents, or entities;
(6) the letter of credit designates the commissioner as beneficiary; and
(7) the letter of credit may be drawn upon after insolvency of the health maintenance
organization.
    Subd. 10. Supplemental deposit. A health maintenance organization offering supplemental
benefits as described in section 62D.05, subdivision 6, must maintain an additional deposit in the
first year such benefits are offered equal to $50,000. At the end of the second year such benefits
are offered, the health maintenance organization must maintain an additional deposit equal to
$150,000. At the end of the third year such benefits are offered and every year thereafter, the
health maintenance organization must maintain an additional deposit of $250,000.
History: 1984 c 464 s 14; 1985 c 248 s 24; 1988 c 612 s 5-13; 1989 c 282 art 2 s 3,4;
1990 c 538 s 16; 2004 c 285 art 3 s 4
62D.042 INITIAL NET WORTH REQUIREMENT.
    Subdivision 1. Definition. For purposes of this section, if a health maintenance organization
offers supplemental benefits as described in section 62D.05, subdivision 6, "expenses" does not
include any expenses attributable to the supplemental benefit.
    Subd. 2. Initial net worth requirement. Beginning organizations shall maintain net worth
of at least 8-1/3 percent of the sum of all expenses expected to be incurred in the 12 months
following the date the certificate of authority is granted, or $1,500,000, whichever is greater.
    Subd. 3.[Repealed, 1998 c 407 art 8 s 14]
    Subd. 4. Reduction for reinsurance. In calculating expenses for purposes of the net worth
requirement, a health maintenance organization may subtract 90 percent of the cost of premiums
it pays for insurance coverage specified in section 62D.04, subdivision 1, clause (f).
    Subd. 5.[Repealed, 2004 c 285 art 3 s 11]
    Subd. 6.[Repealed, 2004 c 285 art 3 s 11]
    Subd. 7.[Repealed, 2004 c 285 art 3 s 11]
History: 1988 c 612 s 14; 1989 c 282 art 2 s 5; 1993 c 345 art 2 s 1; 1995 c 234 art 7 s 7;
1997 c 205 s 5; 1998 c 407 art 8 s 2; 2004 c 285 art 3 s 5,6,10
62D.043 [Repealed, 2004 c 285 art 3 s 11]
62D.044 ADMITTED ASSETS.
"Admitted assets" includes the following:
(1) petty cash and other cash funds in the organization's principal or official branch office
that are under the organization's control;
(2) immediately withdrawable funds on deposit in demand accounts, in a bank or trust
company organized and regularly examined under the laws of the United States or any state, and
insured by an agency of the United States government, or like funds actually in the principal or
official branch office at statement date, and, in transit to a bank or trust company with authentic
deposit credit given before the close of business on the fifth bank working day following the
statement date;
(3) the amount fairly estimated as recoverable on cash deposited in a closed bank or trust
company, if the assets qualified under this section before the suspension of the bank or trust
company;
(4) bills and accounts receivable that are collateralized by securities in which the organization
is authorized to invest;
(5) premiums due from groups or individuals that are not more than 90 days past due;
(6) amounts due under reinsurance arrangements from insurance companies authorized
to do business in this state;
(7) tax refunds due from the United States or this state;
(8) principal and interest accrued on mortgage loans not exceeding in aggregate one year's
total due and accrued principal and interest on an individual loan;
(9) the rents due to the organization on real and personal property, directly or beneficially
owned, not exceeding the amount of one year's total due and accrued rent on each individual
property;
(10) principal and interest or rents accrued on conditional sales agreements, security interests,
chattel mortgages, and real or personal property under lease to other corporations that do not
exceed the amount of one year's total due and accrued interest or rent on an individual investment;
(11) the fixed required principal and interest due and accrued on bonds and other evidences
of indebtedness that are not in default;
(12) dividends receivable on shares of stock, provided that the market price for valuation
purposes does not include the value of the dividend;
(13) the interest on dividends due and payable, but not credited, on deposits in banks and
trust companies or on accounts with savings associations;
(14) principal and interest accrued on secured loans that do not exceed the amount of one
year's interest on any loan;
(15) interest accrued on tax anticipation warrants;
(16) the amortized value of electronic computer or data processing machines or systems
purchased for use in the business of the organization, including software purchased and developed
specifically for the organization's use;
(17) the cost of furniture, equipment, and medical equipment, less accumulated depreciation
thereon, and medical and pharmaceutical supplies that are used to deliver health care and are
under the organization's control, provided such assets do not exceed 30 percent of admitted assets;
(18) amounts currently due from an affiliate that has liquid assets with which to pay the
balance and maintain its accounts on a current basis. Any amount outstanding more than three
months is not current;
(19) amounts on deposit under section 62D.041;
(20) accounts receivable from participating health care providers that are not more than
60 days past due; and
(21) investments allowed by section 62D.045, except for investments in securities and
properties described under section 61A.284.
History: 1988 c 612 s 15; 1990 c 538 s 18; 1991 c 286 s 1; 1991 c 325 art 10 s 11; 1995 c
202 art 1 s 25
62D.045 INVESTMENT RESTRICTIONS.
    Subdivision 1. Restrictions. Funds of a health maintenance organization shall be invested
only in securities and property designated by law for investment by domestic life insurance
companies, except that money may be used to purchase real estate, including leasehold estates
and leasehold improvements, for the convenient accommodation of the organization's business
operations, including the home office, branch offices, medical facilities, and field office operations,
on the following conditions:
(1) a parcel of real estate acquired under this subdivision may include excess space for rent
to others if it is reasonably anticipated that the excess will be required by the organization for
expansion or if the excess is reasonably required in order to have one or more buildings that
will function as an economic unit;
(2) the real estate may be subject to a mortgage; and
(3) the purchase price of the asset, including capitalized permanent improvements, less
depreciation spread evenly over the life of the property or less depreciation computed on
any basis permitted under the Internal Revenue Code and its regulations, or the organization's
equity, plus all encumbrances on the real estate owned by a company under this subdivision,
whichever is greater, does not exceed 20 percent of its admitted assets, except if, when calculated
in combination with the assets described in section 62D.044, clause (17), the total of said
assets and the real estate assets described hereunder do not exceed the total combined percent
limitations allowable under this section and section 62D.044, clause (17), or, if permitted by
the commissioner upon a finding that the percentage of the health maintenance organization's
admitted assets is insufficient to provide convenient accommodation for the organization's
business. However, a health maintenance organization that owns property used in the delivery of
medical services for its enrollees may invest an additional 20 percent of its admitted assets in
real estate, not requiring the permission of the commissioner.
    Subd. 2. Authorization and written investment policy required. A health maintenance
organization shall not make or engage in a loan or investment unless the loan or investment has
been authorized or ratified by the board of directors or by a committee supervising investments
and loans. In addition, a health maintenance organization must comply with section 60A.112.
    Subd. 3. Limits on commissions. A health maintenance organization shall not pay a
commission or brokerage for the purchase or sale of real or personal property that exceeds
usual and customary commissions or brokerage at the time and place of the purchases or sales.
Information regarding payments of commissions and brokerage must be maintained by the health
maintenance organization.
    Subd. 4. Officer's conflict of interest. A health maintenance organization shall not
knowingly, directly or indirectly, invest in or loan upon any real or personal property, in which
any principal officer or director of the organization has a financial interest. An organization shall
not make a loan to a principal officer or director of the organization.
    Subd. 5. Exemption. This section shall not apply to a health maintenance organization which
has a city or county as a guaranteeing organization.
History: 1988 c 612 s 16; 1991 c 286 s 2; 1991 c 325 art 10 s 12; art 18 s 2; 2000 c 260 s
97 para (g)
62D.05 POWERS OF HEALTH MAINTENANCE ORGANIZATIONS.
    Subdivision 1. Authority granted. Any nonprofit corporation or local governmental unit
may, upon obtaining a certificate of authority as required in sections 62D.01 to 62D.30, operate as
a health maintenance organization.
    Subd. 2. Contracts; generally. A health maintenance organization may enter into health
maintenance contracts in this state and engage in any other activities consistent with sections
62D.01 to 62D.30 which are necessary to the performance of its obligations under such contracts
or authorize its representatives to do so.
    Subd. 3. Contracts; health services. A health maintenance organization may contract with
providers of health care services to render the services the health maintenance organization has
promised to provide under the terms of its health maintenance contracts, may, subject to section
62D.12, subdivision 11, enter into separate prepaid dental contracts, or other separate health
service contracts, may, subject to the limitations of section 62D.04, subdivision 1, clause (f),
contract with insurance companies and nonprofit health service plan corporations for insurance,
indemnity or reimbursement of its cost of providing health care services for enrollees or against
the risks incurred by the health maintenance organization, may contract with insurance companies
and nonprofit health service plan corporations for insolvency insurance coverage, and may
contract with insurance companies and nonprofit health service plan corporations to insure or
cover the enrollees' costs and expenses in the health maintenance organization, including the
customary prepayment amount and any co-payment obligations.
    Subd. 4. Contracts; administrative services. A health maintenance organization may
contract with other persons for the provision of services, including, but not limited to, managerial
and administration, marketing and enrolling, data processing, actuarial analysis, and billing
services. If contracts are made with insurance companies or nonprofit health service plan
corporations, such companies or corporations must be authorized to transact business in this state.
    Subd. 5. Payment acceptance. Each health maintenance organization authorized to operate
under sections 62D.01 to 62D.30, or its representative, may accept from governmental agencies,
private agencies, corporations, associations, groups, individuals, or other persons payments
covering all or part of the cost of health care services provided to enrollees. Any recipient of
medical assistance, pursuant to chapter 256B, may make application to join a health maintenance
organization which has been approved for medical assistance by the commissioner of human
services.
    Subd. 6. Supplemental benefits. (a) A health maintenance organization may, as a
supplemental benefit, provide coverage to its enrollees for health care services and supplies
received from providers who are not employed by, under contract with, or otherwise affiliated
with the health maintenance organization. Supplemental benefits may be provided if the following
conditions are met:
(1) a health maintenance organization desiring to offer supplemental benefits must at all
times comply with the requirements of sections 62D.041 and 62D.042;
(2) a health maintenance organization offering supplemental benefits must maintain an
additional surplus in the first year supplemental benefits are offered equal to the lesser of
$500,000 or 33 percent of the supplemental benefit expenses. At the end of the second year
supplemental benefits are offered, the health maintenance organization must maintain an
additional surplus equal to the lesser of $1,000,000 or 33 percent of the supplemental benefit
expenses. At the end of the third year benefits are offered and every year after that, the health
maintenance organization must maintain an additional surplus equal to the greater of $1,000,000
or 33 percent of the supplemental benefit expenses. When in the judgment of the commissioner
the health maintenance organization's surplus is inadequate, the commissioner may require the
health maintenance organization to maintain additional surplus;
(3) claims relating to supplemental benefits must be processed in accordance with the
requirements of section 72A.201; and
(4) in marketing supplemental benefits, the health maintenance organization shall fully
disclose and describe to enrollees and potential enrollees the nature and extent of the supplemental
coverage, and any claims filing and other administrative responsibilities in regard to supplemental
benefits.
(b) The commissioner may, pursuant to chapter 14, adopt, enforce, and administer rules
relating to this subdivision, including: rules insuring that these benefits are supplementary
and not substitutes for comprehensive health maintenance services by addressing percentage
of out-of-plan coverage; rules relating to the establishment of necessary financial reserves;
rules relating to marketing practices; and other rules necessary for the effective and efficient
administration of this subdivision. The commissioner, in adopting rules, shall give consideration
to existing laws and rules administered and enforced by the Department of Commerce relating
to health insurance plans.
History: 1973 c 670 s 5; 1983 c 205 s 5; 1984 c 464 s 15; 1984 c 654 art 5 s 58; 1987 c 337
s 64; 1987 c 384 art 2 s 1; 1988 c 612 s 17; 1989 c 282 art 2 s 6
62D.06 GOVERNING BODY.
    Subdivision 1. Governing body composition; enrollee advisory body. The governing body
of any health maintenance organization which is a nonprofit corporation may include enrollees,
providers, or other individuals; provided, however, that after a health maintenance organization
which is a nonprofit corporation has been authorized under sections 62D.01 to 62D.30 for one
year, at least 40 percent of the governing body shall be composed of enrollees and members
elected by the enrollees and members from among the enrollees and members. For purposes of
this section, "member" means a consumer who receives health care services through a self-insured
contract that is administered by the health maintenance organization or its related third-party
administrator. The number of members elected to the governing body shall not exceed the number
of enrollees elected to the governing body. An enrollee or member elected to the governing
board may not be a person:
(1) whose occupation involves, or before retirement involved, the administration of health
activities or the provision of health services;
(2) who is or was employed by a health care facility as a licensed health professional; or
(3) who has or had a direct substantial financial or managerial interest in the rendering of a
health service, other than the payment of a reasonable expense reimbursement or compensation as
a member of the board of a health maintenance organization.
After a health maintenance organization which is a local governmental unit has been
authorized under sections 62D.01 to 62D.30 for one year, an enrollee advisory body shall be
established. The enrollees who make up this advisory body shall be elected by the enrollees
from among the enrollees.
    Subd. 2. Enrollee input. The governing body shall establish a mechanism to afford the
enrollees an opportunity to express their opinions in matters of policy and operation through the
establishment of advisory panels, by the use of advisory referenda on major policy decisions,
or through the use of other mechanisms as may be prescribed or permitted by the commissioner
of health.
History: 1973 c 670 s 6; 1974 c 284 s 10; 1977 c 305 s 45; 1983 c 205 s 6; 1987 c 384 art 2
s 1; 1988 c 592 s 1; 1997 c 205 s 6
62D.07 EVIDENCE OF COVERAGE; REQUIRED TERMS.
    Subdivision 1. Requirement. Every health maintenance organization enrollee residing in
this state is entitled to evidence of coverage or contract. The health maintenance organization or
its designated representative shall issue the evidence of coverage or contract.
    Subd. 2. Filing with commissioner. No evidence of coverage or contract, or amendment
thereto shall be issued or delivered to any person in this state until a copy of the form of the
evidence of coverage or contract or amendment thereto has been filed with the commissioner of
health pursuant to section 62D.03 or 62D.08.
    Subd. 3. Required provisions. Contracts and evidences of coverage shall contain:
(a) no provisions or statements which are unjust, unfair, inequitable, misleading, deceptive,
or which are untrue, misleading, or deceptive as defined in section 62D.12, subdivision 1;
(b) a clear, concise and complete statement of:
(1) the health care services and the insurance or other benefits, if any, to which the enrollee is
entitled under the health maintenance contract;
(2) any exclusions or limitations on the services, kind of services, benefits, or kind of
benefits, to be provided, including any deductible or co-payment feature and requirements for
referrals, prior authorizations, and second opinions;
(3) where and in what manner information is available as to how services, including
emergency and out of area services, may be obtained;
(4) the total amount of payment and co-payment, if any, for health care services and the
indemnity or service benefits, if any, which the enrollee is obligated to pay with respect to
individual contracts, or an indication whether the plan is contributory or noncontributory with
respect to group certificates; and
(5) a description of the health maintenance organization's method for resolving enrollee
complaints and a statement identifying the commissioner as an external source with whom
complaints may be registered; and
(c) on the cover page of the evidence of coverage and contract, a clear and complete
statement of enrollees' rights. The statement must be in bold print and captioned "Important
Enrollee Information and Enrollee Bill of Rights" and must include but not be limited to the
following provisions in the following language or in substantially similar language approved in
advance by the commissioner, except that paragraph (8) does not apply to prepaid health plans
providing coverage for programs administered by the commissioner of human services:
ENROLLEE INFORMATION
(1) COVERED SERVICES: Services provided by (name of health maintenance organization)
will be covered only if services are provided by participating (name of health maintenance
organization) providers or authorized by (name of health maintenance organization). Your
contract fully defines what services are covered and describes procedures you must follow
to obtain coverage.
(2) PROVIDERS: Enrolling in (name of health maintenance organization) does not guarantee
services by a particular provider on the list of providers. When a provider is no longer part of
(name of health maintenance organization), you must choose among remaining (name of the
health maintenance organization) providers.
(3) REFERRALS: Certain services are covered only upon referral. See section (section
number) of your contract for referral requirements. All referrals to non-(name of health
maintenance organization) providers and certain types of health care providers must be authorized
by (name of health maintenance organization).
(4) EMERGENCY SERVICES: Emergency services from providers who are not affiliated
with (name of health maintenance organization) will be covered only if proper procedures are
followed. Your contract explains the procedures and benefits associated with emergency care from
(name of health maintenance organization) and non-(name of health maintenance organization)
providers.
(5) EXCLUSIONS: Certain services or medical supplies are not covered. You should read
the contract for a detailed explanation of all exclusions.
(6) CONTINUATION: You may convert to an individual health maintenance organization
contract or continue coverage under certain circumstances. These continuation and conversion
rights are explained fully in your contract.
(7) CANCELLATION: Your coverage may be canceled by you or (name of health
maintenance organization) only under certain conditions. Your contract describes all reasons for
cancellation of coverage.
(8) NEWBORN COVERAGE: If your health plan provides for dependent coverage, a
newborn infant is covered from birth, but only if services are provided by participating (name
of health maintenance organization) providers or authorized by (name of health maintenance
organization). Certain services are covered only upon referral. (Name of health maintenance
organization) will not automatically know of the infant's birth or that you would like coverage
under your plan. You should notify (name of health maintenance organization) of the infant's birth
and that you would like coverage. If your contract requires an additional premium for each
dependent, (name of health maintenance organization) is entitled to all premiums due from the
time of the infant's birth until the time you notify (name of health maintenance organization)
of the birth. (Name of health maintenance organization) may withhold payment of any health
benefits for the newborn infant until any premiums you owe are paid.
(9) PRESCRIPTION DRUGS AND MEDICAL EQUIPMENT: Enrolling in (name of health
maintenance organization) does not guarantee that any particular prescription drug will be
available nor that any particular piece of medical equipment will be available, even if the drug or
equipment is available at the start of the contract year.
ENROLLEE BILL OF RIGHTS
(1) Enrollees have the right to available and accessible services including emergency
services, as defined in your contract, 24 hours a day and seven days a week;
(2) Enrollees have the right to be informed of health problems, and to receive information
regarding treatment alternatives and risks which is sufficient to assure informed choice;
(3) Enrollees have the right to refuse treatment, and the right to privacy of medical and
financial records maintained by the health maintenance organization and its health care providers,
in accordance with existing law;
(4) Enrollees have the right to file a complaint with the health maintenance organization and
the commissioner of health and the right to initiate a legal proceeding when experiencing a
problem with the health maintenance organization or its health care providers;
(5) Enrollees have the right to a grace period of 31 days for the payment of each premium for
an individual health maintenance contract falling due after the first premium during which period
the contract shall continue in force;
(6) Medicare enrollees have the right to voluntarily disenroll from the health maintenance
organization and the right not to be requested or encouraged to disenroll except in circumstances
specified in federal law; and
(7) Medicare enrollees have the right to a clear description of nursing home and home care
benefits covered by the health maintenance organization.
    Subd. 4. Payment grace period. A grace period of 31 days shall be granted for payment
of each premium for an individual health maintenance contract falling due after the first
premium, during which period the contract shall continue in force. Individual health maintenance
organization contracts shall clearly state the existence of the grace period.
    Subd. 5. Contract cancellation. Individual health maintenance contracts shall state that
any person may cancel the contract within ten days of its receipt and have the premium paid
refunded if, after examination of the contract, the individual is not satisfied with it for any reason.
The individual is responsible for repaying the health maintenance organization for any services
rendered or claims paid by the health maintenance organization during the ten days.
    Subd. 6. Coverage termination. The contract and evidence of coverage shall clearly explain
the conditions upon which a health maintenance organization may terminate coverage.
    Subd. 7. Continuation and conversion. The contract and evidence of coverage shall clearly
explain continuation and conversion rights afforded to enrollees.
    Subd. 8. Notice of changes. Individual and group contract holders shall be given 30 days'
advance, written notice of any change in subscriber fees or benefits.
    Subd. 9. Delivery. Individual health maintenance organization contracts shall be delivered
to enrollees no later than the date coverage is effective. For enrollees with group contracts, an
evidence of coverage shall be delivered or issued for delivery not more than 15 days from the
date the health maintenance organization is notified of the enrollment or the effective date of
coverage, whichever is later.
    Subd. 10. Complaint telephone number. An individual health maintenance organization
contract and an evidence of coverage must contain a Department of Health telephone number that
the enrollee can call to register a complaint about a health maintenance organization.
History: 1973 c 670 s 7; 1977 c 305 s 45; 1984 c 464 s 16-19; 1986 c 444; 1988 c 434 s
3; 1988 c 592 s 2; 1997 c 205 s 7
62D.08 ANNUAL REPORT.
    Subdivision 1. Notice of changes. A health maintenance organization shall, unless otherwise
provided for by rules adopted by the commissioner of health, file notice with the commissioner
of health prior to any modification of the operations or documents described in the information
submitted under clauses (a), (b), (e), (f), (g), (i), (j), (l), (m), (n), (o), (p), (q), (r), (s), and (t) of
section 62D.03, subdivision 4. If the commissioner of health does not disapprove of the filing
within 60 days, it shall be deemed approved and may be implemented by the health maintenance
organization.
    Subd. 2. Annual report required. Every health maintenance organization shall annually, on
or before April 1, file a verified report with the commissioner of health covering the preceding
calendar year. However, utilization data required under subdivision 3, clause (c), shall be filed
on or before July 1.
    Subd. 3. Report requirements. Such report shall be on forms prescribed by the
commissioner of health, and shall include:
(a) a financial statement of the organization, including its balance sheet and receipts and
disbursements for the preceding year certified by an independent certified public accountant,
reflecting at least (1) all prepayment and other payments received for health care services rendered,
(2) expenditures to all providers, by classes or groups of providers, and insurance companies or
nonprofit health service plan corporations engaged to fulfill obligations arising out of the health
maintenance contract, (3) expenditures for capital improvements, or additions thereto, including
but not limited to construction, renovation or purchase of facilities and capital equipment, and
(4) a supplementary statement of assets, liabilities, premium revenue, and expenditures for risk
sharing business under section 62D.04, subdivision 1, on forms prescribed by the commissioner;
(b) the number of new enrollees enrolled during the year, the number of group enrollees
and the number of individual enrollees as of the end of the year and the number of enrollees
terminated during the year;
(c) a summary of information compiled pursuant to section 62D.04, subdivision 1, clause (c),
in such form as may be required by the commissioner of health;
(d) a report of the names and addresses of all persons set forth in section 62D.03, subdivision
4
, clause (c), who were associated with the health maintenance organization or the major
participating entity during the preceding year, and the amount of wages, expense reimbursements,
or other payments to such individuals for services to the health maintenance organization or
the major participating entity, as those services relate to the health maintenance organization,
including a full disclosure of all financial arrangements during the preceding year required to be
disclosed pursuant to section 62D.03, subdivision 4, clause (d);
(e) a separate report addressing health maintenance contracts sold to individuals covered by
Medicare, title XVIII of the Social Security Act, as amended, including the information required
under section 62D.30, subdivision 6; and
(f) such other information relating to the performance of the health maintenance organization
as is reasonably necessary to enable the commissioner of health to carry out the duties under
sections 62D.01 to 62D.30.
    Subd. 4. Penalty; extension for good cause. Any health maintenance organization which
fails to file a verified report with the commissioner on or before April 1 of the year due shall be
subject to the levy of a fine up to $500 for each day the report is past due. This failure will serve as
a basis for other disciplinary action against the organization, including suspension or revocation,
in accordance with sections 62D.15 to 62D.17. The commissioner may grant an extension of the
reporting deadline upon good cause shown by the health maintenance organization. Any fine
levied or disciplinary action taken against the organization under this subdivision is subject to the
contested case and judicial review provisions of sections 14.57 to 14.69.
    Subd. 5. Changes in participating entities; penalty. Any cancellation or discontinuance
of any contract or agreement listed in section 62D.03, subdivision 4, clause (e), or listed
subsequently in accordance with this subdivision, shall be reported to the commissioner 120 days
before the effective date. When the health maintenance organization terminates a provider for
cause, death, disability, or loss of license, the health maintenance organization must notify the
commissioner within ten working days of the date the health maintenance organization sends out
or receives the notice of cancellation, discontinuance, or termination. Any health maintenance
organization which fails to notify the commissioner within the time periods prescribed in this
subdivision shall be subject to the levy of a fine up to $200 per contract for each day the notice is
past due, accruing up to the date the organization notifies the commissioner of the cancellation or
discontinuance. Any fine levied under this subdivision is subject to the contested case and judicial
review provisions of chapter 14. The levy of a fine does not preclude the commissioner from
using other penalties described in sections 62D.15 to 62D.17.
    Subd. 6. Financial statements. A health maintenance organization shall submit to the
commissioner unaudited financial statements of the organization for the first three quarters of the
year on forms prescribed by the commissioner. The statements are due 30 days after the end of
the quarter and shall be maintained as nonpublic data, as defined by section 13.02, subdivision
9
. Unaudited financial statements for the fourth quarter shall be submitted at the request of the
commissioner.
History: 1973 c 670 s 8; 1974 c 284 s 2; 1977 c 305 s 45; 1983 c 289 s 114 subd 1; 1984 c
464 s 20-23; 1984 c 655 art 1 s 92; 1985 c 248 s 70; 1986 c 444; 1987 c 130 s 2; 1987 c 329 s 21;
1987 c 384 art 2 s 1; 1988 c 434 s 4,5; 1988 c 612 s 18; 1990 c 538 s 19-21; 2001 c 170 s 1
62D.09 INFORMATION TO ENROLLEES.
    Subdivision 1. Marketing requirements. (a) Any written marketing materials which may be
directed toward potential enrollees and which include a detailed description of benefits provided
by the health maintenance organization shall include a statement of enrollee information and
rights as described in section 62D.07, subdivision 3, paragraphs (b) and (c). Prior to any oral
marketing presentation, the agent marketing the plan must inform the potential enrollees that
any complaints concerning the material presented should be directed to the health maintenance
organization, the commissioner of health, or, if applicable, the employer.
(b) Detailed marketing materials must affirmatively disclose all exclusions and limitations in
the organization's services or kinds of services offered to the contracting party, including but not
limited to the following types of exclusions and limitations:
(1) health care services not provided;
(2) health care services requiring co-payments or deductibles paid by enrollees;
(3) the fact that access to health care services does not guarantee access to a particular
provider type; and
(4) health care services that are or may be provided only by referral of a physician.
(c) No marketing materials may lead consumers to believe that all health care needs will
be covered. All marketing materials must alert consumers to possible uncovered expenses with
the following language in bold print: "THIS HEALTH CARE PLAN MAY NOT COVER
ALL YOUR HEALTH CARE EXPENSES; READ YOUR CONTRACT CAREFULLY TO
DETERMINE WHICH EXPENSES ARE COVERED." Immediately following the disclosure
required under paragraph (b), clause (3), consumers must be given a telephone number to use
to contact the health maintenance organization for specific information about access to provider
types.
(d) The disclosures required in paragraphs (b) and (c) are not required on billboards or
image, and name identification advertisement.
    Subd. 2. Information upon application. The application for coverage by the health
maintenance organization shall be accompanied by the statement of consumer information and
rights as described in section 62D.07, subdivision 3, paragraph (c).
    Subd. 3. Annual report to enrollees. Every health maintenance organization or its
representative shall annually, before June 1, provide to its enrollees the following:
(1) a summary of its most recent annual financial statement including a balance sheet and
statement of receipts and disbursements;
(2) a description of the health maintenance organization, its health care plan or plans, its
facilities and personnel, any material changes therein since the last report;
(3) the current evidence of coverage, or amendments thereto; and
(4) a statement of enrollee information and rights as described in section 62D.07, subdivision
3
, paragraph (c).
Under clause (3), a health maintenance organization may annually alternate between
providing enrollees with amendments and providing current evidence of coverage.
    Subd. 4. Medicare information. Health maintenance organizations which issue contracts
to persons who are covered by title XVIII of the Social Security Act (Medicare) must give the
applicant, at the time of application, an outline containing at least the following information:
(1) a description of the principal benefits and coverage provided in the contract, including
a clear description of nursing home and home care benefits covered by the health maintenance
organization;
(2) a statement of the exceptions, reductions, and limitations contained in the contract;
(3) the following language: "This contract does not cover all skilled nursing home care or
home care services and does not cover custodial or residential nursing care. Read your contract
carefully to determine which nursing home facilities and home care services are covered by your
contract, and what procedures you must follow to receive these benefits.";
(4) a statement of the renewal provisions including any reservation by the health maintenance
organization of the right to change fees;
(5) a statement that the outline of coverage is a summary of the contract issued or applied for
and that the contract should be read to determine governing contractual provisions; and
(6) a statement explaining that the enrollee's Medicare coverage is altered by enrollment with
the health maintenance organization, if applicable.
    Subd. 5. Participating providers. Health maintenance organizations shall provide enrollees
with a list of the names and locations of participating providers to whom enrollees have direct
access without referral no later than the effective date of enrollment or date the evidence of
coverage is issued and upon request. Health maintenance organizations need not provide the
names of their employed providers.
    Subd. 6. List of providers; requirements. Any list of providers issued by the health
maintenance organization shall include the date the list was published and contain a bold type
notice in a prominent location on the list of providers with the following language, or substantially
similar language approved in advance by the commissioner:
"Enrolling in (name of health maintenance organization) does not guarantee services by a
particular provider on this list. If you wish to be certain of receiving care from a specific provider
listed, you should contact that provider to ask whether or not the provider is still a (name of health
maintenance organization) provider and whether or not the provider is accepting additional
patients."
    Subd. 7. Requests for information. Every health maintenance organization shall provide
the information described in section 62D.07, subdivision 3, paragraphs (b) and (c), to enrollees or
their representatives on request, within a reasonable time. Information on how to obtain referrals,
prior authorization, or second opinion shall be given to the enrollee or an enrollee's representative
in person or by telephone within one business day following the day the health maintenance
organization or its representative receives the request for information.
    Subd. 8. Membership cards; summary of complaints. Each health maintenance
organization shall issue a membership card to its enrollees. The membership card must:
(1) identify the health maintenance organization;
(2) include the name, address, and telephone number to call if the enrollee has a complaint;
(3) include the telephone number to call or the instruction on how to receive authorization
for emergency care; and
(4) include one of the following:
(i) the telephone number to call to appeal to or file a complaint with the commissioner of
health; or
(ii) for persons enrolled under section 256B.69, 256B.77, 256D.03, or 256L.12, the telephone
number to call to file a complaint with the ombudsperson designated by the commissioner of
human services under section 256B.69 or the Office of the Ombudsman for Mental Health and
Developmental Disabilities under section 256B.77 and the address to appeal to the commissioner
of human services. The ombudsperson shall annually provide the commissioner of health with
a summary of complaints and actions taken.
History: 1973 c 670 s 9; 1984 c 464 s 24; 1985 c 248 s 25; 1986 c 444; 1988 c 434 s 6;
1988 c 592 s 3-5; 1997 c 205 s 8-10; 1997 c 225 art 2 s 7; 2000 c 474 s 1; 2005 c 56 s 1
62D.095 ENROLLEE COST SHARING.
    Subdivision 1. General application. A health maintenance contract may contain enrollee
cost-sharing provisions as specified in this section. Co-payment and deductible provisions in a
group contract must not discriminate on the basis of age, sex, race, disability, economic status, or
length of enrollment in the health plan. During an open enrollment period in which all offered
health plans fully participate without any underwriting restrictions, co-payment and deductible
provisions must not discriminate on the basis of preexisting health status.
    Subd. 2. Co-payments. (a) A health maintenance contract may impose a co-payment as
authorized under Minnesota Rules, part 4685.0801, or under this section.
(b) A health maintenance organization may impose a flat fee co-payment on outpatient
office visits not to exceed 40 percent of the median provider's charges for similar services or
goods received by the enrollees as calculated under Minnesota Rules, part 4685.0801. A health
maintenance organization may impose a flat fee co-payment on outpatient prescription drugs not
to exceed 50 percent of the median provider's charges for similar services or goods received by
the enrollees as calculated under Minnesota Rules, part 4685.0801.
(c) If a health maintenance contract is permitted to impose a co-payment for preexisting
health status under sections 62D.01 to 62D.30, these provisions may vary with respect to length
of enrollment in the health plan.
    Subd. 3. Deductibles. (a) A health maintenance contract issued by a health maintenance
organization that is assessed less than three percent of the total annual amount assessed by the
Minnesota comprehensive health association may impose deductibles not to exceed $3,000 per
person, per year and $6,000 per family, per year. For purposes of the percentage calculation, a
health maintenance organization's assessments include those of its affiliates.
(b) All other health maintenance contracts may impose deductibles not to exceed $2,250 per
person, per year and $4,500 per family, per year.
    Subd. 4. Annual out-of-pocket maximums. (a) A health maintenance contract issued by
a health maintenance organization that is assessed less than three percent of the total annual
amount assessed by the Minnesota comprehensive health association must include a limitation
not to exceed $4,500 per person and $7,500 per family on total annual out-of-pocket enrollee
cost-sharing expenses. For purposes of the percentage calculation, a health maintenance
organization's assessments include those of its affiliates.
(b) All other health maintenance contracts must include a limitation not to exceed $3,000 per
person and $6,000 per family on total annual out-of-pocket enrollee cost-sharing expenses.
    Subd. 5. Exceptions. No co-payments or deductibles may be imposed on preventive health
care services as described in Minnesota Rules, part 4685.0801, subpart 8.
    Subd. 6. Public programs. This section does not apply to the prepaid medical assistance
program, the MinnesotaCare program, the prepaid general assistance program, the federal
Medicare program, or the health plans provided through any of those programs.
History: 2002 c 387 s 3; 1Sp2003 c 14 art 7 s 8,9
62D.10 PROVISIONS APPLICABLE TO ALL HEALTH PLANS.
    Subdivision 1. Applicability. The provisions of this section shall be applicable to nonprofit
prepaid health care plans regulated under chapter 317A, and health maintenance organizations
regulated pursuant to sections 62D.01 to 62D.30, both of which for purposes of this section
shall be known as "health plans."
    Subd. 2.[Repealed, 1984 c 464 s 46]
    Subd. 3. Open enrollment. A health plan providing health maintenance services or
reimbursement for health care costs to a specified group or groups may limit the open enrollment
in each group plan to members of such group or groups, but after it has been in operation 24
months shall have an annual open enrollment period of at least 14 days during which it shall
accept all otherwise eligible individuals in the order in which they apply for enrollment in a
manner which does not discriminate on the basis of age, sex, race, health, or economic status. The
health maintenance organization shall notify potential enrollees of any limitations on the number
of new enrollees to be accepted. "Specified groups" may include, but shall not be limited to:
(a) employees of one or more specified employers;
(b) members of one or more specified labor unions;
(c) members of one or more specified associations;
(d) patients of physicians providing services through a health care plan who had previously
provided services outside the health care plan; and
(e) members of an existing group insurance policy.
    Subd. 4. Waivers. A health plan may apply to the commissioner of health for a waiver of the
requirements of this section or for authorization to impose such underwriting restrictions upon
open enrollment as are necessary (a) to preserve its financial stability, (b) to prevent excessive
adverse selection by prospective enrollees, or (c) to avoid unreasonably high or unmarketable
charges for enrollee coverage for health care services. The commissioner of health upon a
showing of good cause, shall approve or upon failure to show good cause shall deny such
application within 30 days of the receipt thereof from the health plan. The commissioner of health
may, in accordance with chapter 14, promulgate rules to implement this section.
    Subd. 5. Application fee. Any fee charged by a health maintenance organization for the
process of determining an applicant's eligibility, and any other application fee charged, shall
be refunded with interest to the applicant if the applicant is not accepted for enrollment in the
health maintenance organization, or credited with interest to the applicant's premiums due if the
applicant is accepted for enrollment in the organization.
    Subd. 6. Statement of risk sharing. Health maintenance organization contracts under
section 62D.04, subdivision 1, shall include a clear statement of the risk sharing arrangement.
History: 1973 c 670 s 10; 1974 c 284 s 3,4; 1977 c 305 s 45; 1977 c 409 s 3; 1982 c 424 s
130; 1984 c 464 s 25,26; 1987 c 130 s 3; 1987 c 384 art 2 s 1; 1989 c 304 s 137
62D.101 CONTINUATION AND CONVERSION PRIVILEGES FOR FORMER SPOUSES
AND CHILDREN.
    Subdivision 1. Termination of coverage. No health maintenance contract which, in addition
to covering an enrollee, also covers the enrollee's spouse shall contain a provision for termination
of coverage for a spouse covered under the health maintenance contract solely as a result of
a break in the marital relationship.
    Subd. 2. Conversion privilege. Every health maintenance contract, as described in
subdivision 1 shall contain a provision allowing a former spouse and dependent children of
an enrollee, without providing evidence of insurability, to obtain from the health maintenance
organization at the expiration of any continuation of coverage required under subdivision 2a or
sections 62A.146 and 62D.105, an individual health maintenance contract providing at least the
minimum benefits of a qualified plan as prescribed by section 62E.06 and the option of a number
three qualified plan, a number two qualified plan, a number one qualified plan as provided by
section 62E.06, subdivisions 1 to 3, provided application is made to the health maintenance
organization within 30 days following notice of the expiration of the continued coverage and upon
payment of the appropriate fee. A contract providing reduced benefits at a reduced fee may be
accepted by the former spouse and dependent children in lieu of the optional coverage otherwise
required by this subdivision. The individual health maintenance contract shall be renewable
at the option of the former spouse as long as the former spouse is not covered under another
qualified plan as defined in section 62E.02, subdivision 4. Any revisions in the table of rate for the
individual contract shall apply to the former spouse's original age at entry and shall apply equally
to all similar contracts issued by the health maintenance organization.
    Subd. 2a. Continuation privilege. Every health maintenance contract as described in
subdivision 1 shall contain a provision which permits continuation of coverage under the contract
for the enrollee's former spouse and children upon entry of a valid decree of dissolution of
marriage. The coverage shall be continued until the earlier of the following dates:
(a) the date the enrollee's former spouse becomes covered under another group plan or
Medicare; or
(b) the date coverage would otherwise terminate under the health maintenance contract.
If coverage is provided under a group policy, any required premium contributions for the
coverage shall be paid by the enrollee on a monthly basis to the group contract holder to be paid to
the health maintenance organization. The contract must require the group contract holder to, upon
request, provide the enrollee with written verification from the insurer of the cost of this coverage
promptly at the time of eligibility for this coverage and at any time during the continuation period.
In no event shall the fee charged exceed 102 percent of the cost to the plan for the period of
coverage for other similarly situated spouses and dependent children when the marital relationship
has not dissolved, regardless of whether the cost is paid by the employer or employee.
    Subd. 3. Application. Subdivision 1 applies to every health maintenance contract which is
delivered, issued for delivery, renewed or amended on or after July 19, 1977.
Subdivisions 2 and 2a apply to every health maintenance contract which is delivered, issued
for delivery, renewed, or amended on or after March 1, 1983.
History: 1977 c 186 s 3; 1982 c 555 s 10; 1982 c 642 s 16; 1984 c 464 s 27,28; 1988 c 434
s 7; 1990 c 403 s 10; 1992 c 564 art 4 s 10
62D.102 FAMILY THERAPY.
Covered treatment for a minor includes treatment for the family if family therapy is
recommended by a health maintenance organization provider. For purposes of determining
benefits under this section, "hours of treatment" means treatment rendered on an individual or
single-family basis. If treatment is rendered on a group basis, the hours of covered group treatment
must be provided at a ratio of no less than two group treatment sessions to one individual
treatment hour. For a health maintenance contract that is offered as a companion to a health
insurance subscriber contract, the benefits for mental or nervous disorders must be calculated in
aggregate for the health maintenance contract and the health insurance subscriber contract.
History: 1984 c 641 s 3; 1987 c 337 s 65; 1988 c 689 art 2 s 12; 1997 c 205 s 11
62D.103 SECOND OPINION RELATED TO CHEMICAL DEPENDENCY AND MENTAL
HEALTH.
A health maintenance organization shall promptly evaluate the treatment needs of any
enrollee who is seeking treatment for a problem related to chemical dependency or mental health
conditions. In the event that the health maintenance organization or a participating provider
determines that no type of structured treatment is necessary, the enrollee shall be immediately
entitled to a second opinion paid for by the health maintenance organization, by a health care
professional qualified in diagnosis and treatment of the problem and not affiliated with the health
maintenance organization. The health maintenance organization or participating provider shall
consider the second opinion but is not obligated to accept the conclusion of the second opinion.
The health maintenance organization or participating provider shall document its consideration of
the second opinion.
History: 1984 c 641 s 4
62D.104 REQUIRED OUT-OF-AREA CONVERSION.
Enrollees who have individual health maintenance organization contracts and who have
become nonresidents of the health maintenance organization's service area but remain residents
of the state of Minnesota shall be given the option, to be arranged by the health maintenance
organization if an agreement with an insurer can reasonably be made, of a number three qualified
plan, a number two qualified plan, or a number one qualified plan as provided by section 62E.06,
subdivisions 1 to 3
, or, if such enrollees are covered by title XVIII of the Social Security Act
(Medicare), they shall be given the option of a Medicare supplement plan as provided by chapter
62A.
This option shall be made available at the enrollee's expense, without further evidence of
insurability and without interruption of coverage.
If a health maintenance organization cannot make arrangements for conversion coverage,
the health maintenance organization shall notify enrollees of health plans available in other
service areas.
History: 1988 c 434 s 8; 1989 c 258 s 9
62D.105 COVERAGE OF CURRENT SPOUSE AND CHILDREN.
    Subdivision 1. Requirement. Every health maintenance contract, which in addition to
covering the enrollee also provides coverage to the spouse and dependent children of the enrollee
shall: (1) permit the spouse and dependent children to elect to continue coverage when the
enrollee becomes enrolled for benefits under title XVIII of the Social Security Act (Medicare);
and (2) permit the dependent children to continue coverage when they cease to be dependent
children under the generally applicable requirement of the plan.
    Subd. 2. Continuation privilege. The coverage described in subdivision 1 may be continued
until the earlier of the following dates:
(1) the date coverage would otherwise terminate under the contract;
(2) 36 months after continuation by the spouse or dependent was elected; or
(3) the date the spouse or dependent children become covered under another group health
plan or Medicare.
If coverage is provided under a group policy, any required fees for the coverage shall be
paid by the enrollee on a monthly basis to the group contract holder for remittance to the health
maintenance organization. In no event shall the fee charged exceed 102 percent of the cost to
the plan for such coverage for other similarly situated spouse and dependent children to whom
subdivision 1 is not applicable, without regard to whether such cost is paid by the employer or
employee.
History: 1988 c 434 s 9
62D.106 [Repealed, 1995 c 207 art 10 s 25]
62D.108 [Repealed, 2000 c 349 s 2]
62D.109 SERVICES ASSOCIATED WITH CLINICAL TRIALS.
A health maintenance organization must inform an enrollee who is a participant in a clinical
trial upon inquiry by the enrollee that coverage shall be provided as required under the enrollee's
health maintenance contract or under state or federal rule or statute.
History: 1Sp2001 c 9 art 16 s 2; 2002 c 379 art 1 s 113
62D.11 COMPLAINT SYSTEM.
    Subdivision 1. Enrollee complaint system. Every health maintenance organization shall
establish and maintain a complaint system, as required under sections 62Q.68 to 62Q.72 to
provide reasonable procedures for the resolution of written complaints initiated by or on behalf
of enrollees concerning the provision of health care services.
    Subd. 1a. Service coverage. Where a complaint involves a dispute about a health
maintenance organization's coverage of a service, the commissioner may review the complaint
and any information and testimony necessary in order to make a determination and order the
appropriate remedy pursuant to sections 62D.15 to 62D.17.
    Subd. 1b.[Repealed, 1999 c 239 s 43 para (a)]
    Subd. 2.[Repealed, 1999 c 239 s 43 para (a)]
    Subd. 3. Denial of coverage. Within a reasonable time after receiving an enrollee's written
or oral communication to the health maintenance organization concerning a denial of coverage
or inadequacy of services, the health maintenance organization shall provide the enrollee with a
written statement of the reason for the denial of coverage, and a statement approved by the
commissioner of health which explains the health maintenance organization complaint procedures,
and in the case of Medicare enrollees, which also explains Medicare appeal procedures.
    Subd. 4.[Repealed, 1997 c 205 s 40]
History: 1973 c 670 s 11; 1974 c 284 s 5; 1977 c 305 s 45; 1986 c 444; 1988 c 434 s 10;
1988 c 592 s 6,7; 1990 c 538 s 22-24; 1995 c 234 art 2 s 1; 1997 c 205 s 12-14; 1998 c 407 art 2
s 2; 1999 c 239 s 1
62D.12 PROHIBITED PRACTICES.
    Subdivision 1. False representations. No health maintenance organization or representative
thereof may cause or knowingly permit the use of advertising or solicitation which is untrue or
misleading, or any form of evidence of coverage which is deceptive. Each health maintenance
organization shall be subject to sections 72A.17 to 72A.32, relating to the regulation of trade
practices, except (a) to the extent that the nature of a health maintenance organization renders
such sections clearly inappropriate and (b) that enforcement shall be by the commissioner of
health and not by the commissioner of commerce. Every health maintenance organization shall be
subject to sections 8.31 and 325F.69.
    Subd. 1a. Swing-out products. Notwithstanding subdivision 1, nothing in sections 62A.049,
62A.60, and 72A.201, subdivision 4a, applies to a commercial health policy issued under this
chapter as a companion to a health maintenance contract.
    Subd. 2. Coverage cancellation; nonrenewal. No health maintenance organization may
cancel or fail to renew the coverage of an enrollee except for (a) failure to pay the charge for
health care coverage; (b) termination of the health care plan; (c) termination of the group plan; (d)
enrollee moving out of the area served, subject to section 62A.17, subdivisions 1 and 6, and section
62D.104; (e) enrollee moving out of an eligible group, subject to section 62A.17, subdivisions 1
and 6
, and section 62D.104; (f) failure to make co-payments required by the health care plan; (g)
fraud or misrepresentation by the enrollee with respect to eligibility for coverage or any other
material fact; or (h) other reasons established in rules promulgated by the commissioner of health.
    Subd. 2a. Cancellation or nonrenewal notice. Enrollees shall be given 30 days' notice of
any cancellation or nonrenewal, except that enrollees who are eligible to receive replacement
coverage under section 62D.121, subdivision 1, shall receive 90 days' notice as provided under
section 62D.121, subdivision 5.
    Subd. 3. Use of terms. No health maintenance organization may use in its name, contracts,
or literature any of the words "insurance," "casualty," "surety," "mutual," or any other words
which are descriptive of the insurance, casualty or surety business or deceptively similar to the
name or description of any insurance or surety corporation doing business in this state; provided,
however, that when a health maintenance organization has contracted with an insurance company
for any coverage permitted by sections 62D.01 to 62D.30, it may so state.
    Subd. 4. Enrollee reimbursement. No health maintenance contract or evidence of coverage
shall provide for the reimbursement of an enrollee other than through a policy of insurance,
except as stated in this subdivision:
(a) the health maintenance organization may refund payments made by or on behalf of
an enrollee;
(b) the health maintenance organization may make direct payments to enrollees or providers
for obligations incurred for nonelective emergency or out-of-area services received.
    Subd. 5. Recourse limited. The providers under agreement with a health maintenance
organization to provide health care services shall not have recourse against enrollees or
persons acting on their behalf for amounts above those specified in the evidence of coverage
as co-payments for health care services. The health maintenance organization shall not have
recourse against enrollees or persons acting on their behalf for amounts above those specified in
the evidence of coverage as the periodic prepayment, or co-payment, for health care services.
This subdivision applies but is not limited to the following events:
(1) nonpayment by the health maintenance organization;
(2) insolvency of the health maintenance organization; and
(3) breach of the agreement between the health maintenance organization and the provider.
This subdivision does not limit a provider's ability to seek payment from any person other
than the enrollee, the enrollee's guardian or conservator, the enrollee's immediate family members,
or the enrollee's legal representative in the event of nonpayment by the health maintenance
organization.
    Subd. 6. Nondiscriminatory rates. The rates charged by health maintenance organizations
and their representatives shall not discriminate except in accordance with accepted actuarial
principles.
    Subd. 7.[Repealed, 1984 c 464 s 46]
    Subd. 8. Nondiscriminatory enrollment. No health maintenance organization shall
discriminate in enrollment policy against any person solely by virtue of status as a recipient
of medical assistance or Medicare.
    Subd. 9. Net earnings. All net earnings of the health maintenance organization shall
be devoted to the nonprofit purposes of the health maintenance organization in providing
comprehensive health care. No health maintenance organization shall provide for the payment,
whether directly or indirectly, of any part of its net earnings, to any person as a dividend or rebate;
provided, however, that health maintenance organizations may make payments to providers or
other persons based upon the efficient provision of services or as incentives to provide quality
care. The commissioner of health shall, pursuant to sections 62D.01 to 62D.30, revoke the
certificate of authority of any health maintenance organization in violation of this subdivision.
    Subd. 9a. Authorized expenses. Authorized expenses of a health maintenance organization
shall include:
(1) cash rebates to enrollees, or to persons who have made payments on behalf of enrollees;
(2) direct payments to enrollees or providers as provided in subdivision 4, clause (b);
(3) free or reduced cost health service to enrollees;
(4) payments to any organization or organizations selected by the health maintenance
organization which are operated for charitable, educational, or religious or scientific purposes.
    Subd. 9b. Hospital risk agreement. A health maintenance organization shall not enter
into an agreement with a hospital in which the hospital agrees to assume the financial risk for
services provided by other facilities or providers not owned, operated, or otherwise subject to the
control of the hospital assuming the financial risk.
    Subd. 10. Offsetting. No health maintenance contract or evidence of coverage entered into,
issued, amended, renewed or delivered on or after January 1, 1976 shall contain any provision
offsetting, or in any other manner reducing, any benefit to an enrollee or other beneficiary by the
amount of, or in any proportion to, any increase in disability benefits received or receivable
under the federal Social Security Act, as amended subsequent to the date of commencement of
such benefit, the Railroad Retirement Act, any Veteran's Disability Compensation and Survivor
Benefits Act, workers' compensation, or any similar federal or state law, as amended subsequent
to the date of commencement of that benefit.
    Subd. 11. Dental service rates. Any health maintenance organization which includes
coverage of comprehensive dental services in its comprehensive health maintenance services
shall not include the charge for the dental services in the same rate as the charge for other
comprehensive health maintenance services. The rates for dental services shall be computed, stated
and bid separately. No employer shall be required to purchase dental services in combination with
other comprehensive health services. An employer may purchase dental services separately.
    Subd. 12.[Repealed, 1996 c 310 s 1]
    Subd. 13. Refusal based on workers' compensation. No health maintenance organization
offering an individual or group health maintenance contract shall refuse to provide or renew the
coverage because the applicant or enrollee has an option to elect workers' compensation coverage
pursuant to section 176.041.
    Subd. 14. Telephone number. Each health maintenance organization shall establish a
telephone number, which need not be toll free, that providers may call with questions about
coverage, prior authorization, and approval of medical services. The telephone number must be
staffed by an employee of the health maintenance organization during normal working hours
during the normal work week. After normal working hours, the telephone number must be
equipped with an answering machine and recorded message to allow the caller an opportunity
to leave a message. The health maintenance organization must respond to questions within 24
hours after they are received, excluding weekends and holidays. At the request of a provider, the
health maintenance organization shall provide a copy of the health maintenance contract for
enrollees in the provider's service area.
    Subd. 15. Retaliatory action prohibited. No health maintenance organization may take
retaliatory action against a provider solely on the grounds that the provider disseminated accurate
information regarding coverage of benefits or accurate benefit limitations of an enrollee's contract
or accurate interpreted provisions of the provider agreement that limit the prescribing, providing,
or ordering of care.
    Subd. 16.[Repealed, 1990 c 538 s 32]
    Subd. 17. Disclosure of commissions. Any person receiving commissions for the sale
of coverage or enrollment in a health plan, as defined in section 62A.011, offered by a health
maintenance organization shall, before selling coverage or enrollment, disclose in writing to the
prospective purchaser the amount of any commission or other compensation the person will
receive as a direct result of the sale. The disclosure may be expressed in dollars or as a percentage
of the premium. The amount disclosed need not include any anticipated renewal commissions.
    Subd. 18. Special reinstatement privilege. No health maintenance organization shall fail to
comply with the special reinstatement privilege provided under section 62A.04, subdivision 2,
clause (4), for the Medicare-related coverage referred to in that clause.
    Subd. 19. Coverage of service. A health maintenance organization may not deny or limit
coverage of a service which the enrollee has already received solely on the basis of lack of prior
authorization or second opinion, to the extent that the service would otherwise have been covered
under the member's contract by the health maintenance organization had prior authorization
or second opinion been obtained.
History: 1973 c 670 s 12; 1974 c 284 s 8,9; 1975 c 323 s 4; 1976 c 296 art 1 s 18; 1977 c
305 s 45; 1980 c 614 s 74; 1983 c 289 s 114 subd 1; 1984 c 464 s 30-36; 1984 c 641 s 5; 1984 c
655 art 1 s 92; 1985 c 248 s 70; 1987 c 384 art 2 s 1; 1988 c 434 s 11,12; 1988 c 592 s 8,9; 1988
c 612 s 19,20; 1989 c 330 s 23; 1993 c 345 art 5 s 6; 1994 c 485 s 65; 1994 c 625 art 10 s 13;
1995 c 75 s 2; 1996 c 305 art 1 s 20; 1997 c 205 s 15; 1999 c 177 s 43
62D.121 REQUIRED REPLACEMENT COVERAGE.
    Subdivision 1. Replacement coverage. When membership of an enrollee who has individual
health coverage is terminated by the health maintenance organization for a reason other than (a)
failure to pay the charge for health care coverage; (b) failure to make co-payments required by the
health care plan; (c) enrollee moving out of the area served; or (d) a materially false statement
or misrepresentation by the enrollee in the application for membership, the health maintenance
organization must offer or arrange to offer replacement coverage, without evidence of insurability,
without preexisting condition exclusions, and without interruption of coverage.
    Subd. 2. Health maintenance organization coverage required. If the health maintenance
organization has terminated individuals from coverage in a service area, the replacement
coverage shall be health maintenance organization coverage issued by the health maintenance
organization terminating coverage unless the health maintenance organization can demonstrate
to the commissioner that offering health maintenance organization replacement coverage would
not be feasible. In making the determination, the commissioner shall consider (1) loss ratios and
forecasts, (2) lack of agreements between health care providers and the health maintenance
organization to offer that product, (3) evidence of anticipated premium needs compared with
established rates, (4) the financial impact of the replacement coverage on the overall financial
solvency of the plan, and (5) the cost to the enrollee of health maintenance organization
replacement coverage as compared to cost to the enrollee of the replacement coverage required
under subdivision 3.
    Subd. 2a. Other coverage permitted. The terminating health maintenance organization may
also offer as replacement coverage health maintenance organization coverage issued by another
health maintenance organization.
    Subd. 3. Required coverage. If health maintenance organization replacement coverage is
not offered by the health maintenance organization, as explained under subdivisions 2 and 2a, the
replacement coverage shall provide, for enrollees covered by title XVIII of the Social Security
Act, coverage at least equivalent to a basic Medicare supplement plan as defined in section
62A.316, except that the replacement coverage shall also cover the liability for any Medicare Part
A and Part B deductible as defined under title XVIII of the Social Security Act. After satisfaction
of the Medicare Part B deductible, the replacement coverage shall be at least 80 percent of
usual and customary eligible medical expenses and supplies not covered by Medicare Part B
eligible expenses. This does not include outpatient prescription drugs. The fee or premium of the
replacement coverage shall not exceed the premium charged by the state comprehensive health
plan as established under section 62E.08, for a qualified Medicare supplement plan. All enrollees
not covered by Medicare shall be given the option of a number three qualified plan or a number
two qualified plan as defined in section 62E.06, subdivisions 1 and 2, for replacement coverage.
The fee or premium for a number three qualified plan shall not exceed 125 percent of the average
of rates charged by the five insurers with the largest number of individuals in a number three
qualified plan of insurance in force in Minnesota. The fee or premium for a number two qualified
plan shall not exceed 125 percent of the average of rates charged by the five insurers with the
largest number of individuals in a number two qualified plan of insurance in force in Minnesota.
    Subd. 3a. Fee. If the replacement coverage is health maintenance organization coverage, as
explained in subdivisions 2 and 2a, the fee shall not exceed 125 percent of the cost of the average
fee charged by health maintenance organizations for a similar health plan. The commissioner of
health will determine the average cost of the plan on the basis of information provided annually
by the health maintenance organizations concerning the rates charged by the health maintenance
organizations for the plans offered. Fees or premiums charged under this section must be
actuarially justified.
    Subd. 4. Approval required. The commissioner will approve or disapprove the replacement
coverage within 30 days. A health maintenance organization shall not give enrollees a notice of
cancellation of coverage until a replacement policy has been filed with the commissioner and
approved or disapproved.
    Subd. 5. Notice of cancellation. The health maintenance organization must provide the
terminated enrollees with a notice of cancellation 90 days before the date the cancellation takes
effect. If the replacement coverage is approved by the commissioner under subdivision 4, the
notice shall clearly and completely describe the replacement coverage that the enrollees are
eligible to receive and explain the procedure for enrolling. If the replacement coverage is not
approved by the commissioner, the health maintenance organization shall provide a cancellation
notice with information that the enrollee is entitled to enroll in the state comprehensive health
insurance plan with a waiver of the waiting period for preexisting conditions under section
62E.14, subdivisions 1, paragraph (d), and 6.
    Subd. 6. Notice exception. The commissioner may waive the notice required in this section
if the commissioner determines that the health maintenance organization has not received
information regarding Medicare reimbursement rates from the Centers for Medicare and Medicaid
Services before September 1 for contracts renewing on January 1 of the next year. In no event
shall enrollees covered by title XVIII of the Social Security Act receive less than 60 days' notice
of contract termination.
    Subd. 7. Geographic accessibility. If the commissioner determines that there are not enough
providers to assure that enrollees have accessible health services available in a geographic service
area, the commissioner shall institute a plan of corrective action that shall be followed by the
health maintenance organization. Such a plan may include but not be limited to requiring the
health maintenance organization to make payments to nonparticipating providers for health
services for enrollees, requiring the health maintenance organization to discontinue accepting
new enrollees in that service area, and requiring the health maintenance organization to reduce
its geographic service area. If a nonparticipating provider has been a participating provider with
the health maintenance organization within the last year, any payments made under this section
must not exceed the payment level of the previous contract unless the commissioner determines
that without adjusting payments the health maintenance organization will be unable to meet
the health care needs of enrollees in the area.
History: 1988 c 434 s 13; 1989 c 258 s 10; 1990 c 538 s 25,26; 2002 c 277 s 32
62D.122 [Repealed, 1988 c 434 s 24; 1990 c 538 s 31]
62D.123 PROVIDER CONTRACTS.
    Subdivision 1. Provider agreement. Except for an employment agreement between a
provider and health maintenance organization, an agreement to provide health care services
between a provider and a health maintenance organization entered into or renewed after April 25,
1988, must contain the following provision:
PROVIDER AGREES NOT TO BILL, CHARGE, COLLECT A DEPOSIT FROM,
SEEK REMUNERATION FROM, OR HAVE ANY RECOURSE AGAINST AN ENROLLEE
OR PERSONS ACTING ON THEIR BEHALF FOR SERVICES PROVIDED UNDER
THIS AGREEMENT. THIS PROVISION APPLIES TO BUT IS NOT LIMITED TO THE
FOLLOWING EVENTS: (1) NONPAYMENT BY THE HEALTH MAINTENANCE
ORGANIZATION OR (2) BREACH OF THIS AGREEMENT. THIS PROVISION DOES
NOT PROHIBIT THE PROVIDER FROM COLLECTING CO-PAYMENTS OR FEES FOR
UNCOVERED SERVICES.
THIS PROVISION SURVIVES THE TERMINATION OF THIS AGREEMENT FOR
AUTHORIZED SERVICES PROVIDED BEFORE THIS AGREEMENT TERMINATES,
REGARDLESS OF THE REASON FOR TERMINATION. THIS PROVISION IS FOR THE
BENEFIT OF THE HEALTH MAINTENANCE ORGANIZATION ENROLLEES. THIS
PROVISION DOES NOT APPLY TO SERVICES PROVIDED AFTER THIS AGREEMENT
TERMINATES.
THIS PROVISION SUPERSEDES ANY CONTRARY ORAL OR WRITTEN
AGREEMENT EXISTING NOW OR ENTERED INTO IN THE FUTURE BETWEEN
THE PROVIDER AND THE ENROLLEE OR PERSONS ACTING ON THEIR BEHALF
REGARDING LIABILITY FOR PAYMENT FOR SERVICES PROVIDED UNDER THIS
AGREEMENT.
    Subd. 2. Cooperation required. An agreement to provide health care services between a
provider and a health maintenance organization must require the provider to cooperate with and
participate in the health maintenance organization's quality assurance program, dispute resolution
procedure, and utilization review program.
    Subd. 3. Notice of termination. An agreement to provide health care services between a
provider and a health maintenance organization must require that if the provider terminates the
agreement, without cause, the provider shall give the organization 120 days' advance notice
of termination.
    Subd. 4. Late payments. If a health maintenance organization's payments to a provider are
delayed beyond the payment date in the contract, the provider may notify the commissioner who
shall consider that information in assessing the financial solvency of the health maintenance
organization.
History: 1988 c 612 s 21
62D.124 GEOGRAPHIC ACCESSIBILITY.
    Subdivision 1. Primary care; mental health services; general hospital services. Within the
health maintenance organization's service area, the maximum travel distance or time shall be the
lesser of 30 miles or 30 minutes to the nearest provider of each of the following services: primary
care services, mental health services, and general hospital services. The health maintenance
organization must designate which method is used.
    Subd. 2. Other health services. Within a health maintenance organization's service area,
the maximum travel distance or time shall be the lesser of 60 miles or 60 minutes to the nearest
provider of specialty physician services, ancillary services, specialized hospital services, and
all other health services not listed in subdivision 1. The health maintenance organization must
designate which method is used.
    Subd. 3. Exception. The commissioner shall grant an exception to the requirements of this
section according to Minnesota Rules, part 4685.1010, subpart 4, if the health maintenance
organization can demonstrate with specific data that the requirement of subdivision 1 or 2 is not
feasible in a particular service area or part of a service area.
    Subd. 4. Application. (a) Subdivisions 1 and 2 do not apply if an enrollee is referred to a
referral center for health care services.
(b) Subdivision 1 does not apply:
(1) if an enrollee has chosen a health plan with full knowledge that the health plan has no
participating providers within 30 miles or 30 minutes of the enrollee's place of residence; or
(2) to service areas approved before May 24, 1993.
History: 1999 c 239 s 2
62D.13 POWERS OF INSURERS AND NONPROFIT HEALTH SERVICE PLANS.
Notwithstanding any law to the contrary, an insurer or a hospital or medical service plan
corporation may contract with a health maintenance organization to provide insurance or similar
protection against the cost of care provided through health maintenance organizations and to
provide coverage in the event of the failure of the health maintenance organization to meet its
obligations. The enrollees of a health maintenance organization constitute a permissible group for
group coverage under the insurance laws and the Nonprofit Health Service Plan Corporations Act.
Under such contracts, the insurer or nonprofit health service plan corporation may make benefit
payments to health maintenance organizations for health care services rendered, or to be rendered,
by providers pursuant to the health care plan. Any insurer, or nonprofit health service plan
corporation, licensed to do business in this state, is authorized to provide the types of coverages
described in section 62D.05, subdivision 3.
History: 1973 c 670 s 13
62D.14 EXAMINATIONS.
    Subdivision 1. Examination authority. The commissioner of health may make an
examination of the affairs of any health maintenance organization and its contracts, agreements,
or other arrangements with any participating entity as often as the commissioner of health deems
necessary for the protection of the interests of the people of this state, but not less frequently
than once every three years. Examinations of participating entities pursuant to this subdivision
shall be limited to their dealings with the health maintenance organization and its enrollees,
except that examinations of major participating entities may include inspection of the entity's
financial statements kept in the ordinary course of business. The commissioner may require
major participating entities to submit the financial statements directly to the commissioner.
Financial statements of major participating entities are subject to the provisions of section 13.37,
subdivision 1
, clause (b), upon request of the major participating entity or the health maintenance
organization with which it contracts.
    Subd. 2. Notice of examination. The commissioner will notify the organization and
any involved participating entity in writing when an examination has been initiated. The
commissioner will include in this notice a full statement of the pertinent facts and of the matters
being examined, and may include a statement that the organization or participating entity must
submit to the commissioner within 30 days from the date of the notice a complete written report
concerning those matters.
    Subd. 3. Commissioner's authority. In order to accomplish the duties under this section
with respect to the dealings of the participating entities with the health maintenance organization,
the commissioner of health shall have the right to:
(a) inspect or otherwise evaluate the quality, appropriateness, and timeliness of services
performed;
(b) audit and inspect any books and records of a health maintenance organization and a
participating entity which pertain to services performed and determinations of amounts payable
under such contract;
(c) require persons or organizations under examination to be deposed and to answer
interrogatories, regardless of whether an administrative hearing or other civil proceeding has
been or will be initiated; and
(d) employ site visits, public hearings, or any other procedures considered appropriate to
obtain the information necessary to determine the issues.
    Subd. 4.[Repealed, 2000 c 468 s 33]
    Subd. 4a. Classification of data. Any data or information obtained by the commissioner
under this section or section 62D.145 shall be classified as private data on individuals as defined
in chapter 13. Such data shall be protected and may be released consistent with the provisions
of section 60A.03, subdivision 9.
    Subd. 5. Oaths; witnesses; subpoenas. The commissioner of health shall have the power to
administer oaths to and examine witnesses, and to issue subpoenas.
    Subd. 6. Examination expenses. Reasonable expenses of examinations under this section
shall be assessed by the commissioner of health against the organization being examined, and
shall be remitted to the commissioner of health for deposit in the general fund of the state treasury.
    Subd. 7. Penalty. Failure to provide relevant information necessary for conducting
examinations pursuant to this section shall be subject to the levy of a fine up to $200 for each
day the information is not provided. A fine levied under this subdivision shall be subject to the
contested case and judicial review provisions of chapter 14. In the event a timely request for
review is made, accrual of a fine levied shall be stayed pending completion of the contested
case and judicial review proceeding.
History: 1973 c 670 s 14; 1977 c 305 s 45; 1984 c 464 s 37; 1986 c 444; 1987 c 384 art 2 s
1; 1988 c 612 s 22; 2000 c 468 s 18
62D.145 DISCLOSURE OF INFORMATION HELD BY HEALTH MAINTENANCE
ORGANIZATIONS.
    Subdivision 1. Personal and privileged information. The ability of a health maintenance
organization to disclose personal information, as defined in section 72A.491, subdivision 17, and
privileged information, as defined in section 72A.491, subdivision 19, is governed by sections
72A.497, 72A.499, and 72A.502.
    Subd. 2. Health data or information. (a) A health maintenance organization is prohibited
from disclosing to any person any individually identifiable data or information held by the health
maintenance organization pertaining to the diagnosis, treatment, or health of any enrollee, or any
application obtained from any person, except:
(1) to the extent necessary to carry out the purposes of this chapter, the commissioner and a
designee shall have access to the above data or information but the data removed from the health
maintenance organization or participating entity shall not identify any particular patient or client
by name or contain any other unique personal identifier;
(2) upon the express consent of the enrollee or applicant;
(3) pursuant to statute or court order for the production of evidence or the discovery thereof;
(4) in the event of claim or litigation between the person and the provider or health
maintenance organization wherein such data or information is pertinent;
(5) to meet the requirements of contracts for prepaid medical services with the commissioner
of human services authorized under chapter 256B, 256D, or 256L;
(6) to meet the requirements of contracts for benefit plans with the commissioner of
employee relations under chapter 43A; or
(7) as otherwise authorized pursuant to statute.
No provision in a contract for a benefit plan under chapter 43A shall authorize dissemination
of individually identifiable health records, unless the dissemination of the health records is
required to carry out the requirements of the contract and employees whose health records will be
disseminated are fully informed of the dissemination by the Department of Employee Relations at
the time the employees are enrolling for or changing insurance coverage.
(b) In any case involving a suspected violation of a law applicable to health maintenance
organizations in which access to health data maintained by the health maintenance organization
or participating entity is necessary, the commissioner and agents, while maintaining the privacy
rights of individuals and families, shall be permitted to obtain data that identifies any particular
patient or client by name. A health maintenance organization shall be entitled to claim any
statutory privileges against such disclosure which the provider who furnished the information to
the health maintenance organization is entitled to claim.
History: 2000 c 468 s 19
62D.15 SUSPENSION OR REVOCATION OF CERTIFICATE OF AUTHORITY.
    Subdivision 1. Grounds for suspension or revocation. The commissioner of health may
suspend or revoke any certificate of authority issued to a health maintenance organization under
sections 62D.01 to 62D.30 if the commissioner finds that:
(a) the health maintenance organization is operating significantly in contravention of its
basic organizational document, its health maintenance contract, or in a manner contrary to that
described in and reasonably inferred from any other information submitted under section 62D.03,
unless amendments to such submissions have been filed with and approved by the commissioner
of health;
(b) the health maintenance organization issues evidences of coverage which do not comply
with the requirements of section 62D.07;
(c) the health maintenance organization is unable to fulfill its obligations to furnish
comprehensive health maintenance services as required under its health maintenance contract;
(d) the health maintenance organization is no longer financially responsible and may
reasonably be expected to be unable to meet its obligations to enrollees or prospective enrollees;
(e) the health maintenance organization has failed to implement a mechanism affording the
enrollees an opportunity to participate in matters of policy and operation under section 62D.06;
(f) the health maintenance organization has failed to implement the complaint system
required by section 62D.11 in a manner designed to reasonably resolve valid complaints;
(g) the health maintenance organization, or any person acting with its sanction, has
advertised or merchandised its services in an untrue, misrepresentative, misleading, deceptive, or
unfair manner;
(h) the continued operation of the health maintenance organization would be hazardous to
its enrollees; or
(i) the health maintenance organization has otherwise failed to substantially comply with
sections 62D.01 to 62D.30 or with any other statute or administrative rule applicable to health
maintenance organizations, or has submitted false information in any report required hereunder.
    Subd. 2. Procedure. A certificate of authority shall be suspended or revoked only after
compliance with the requirements of section 62D.16.
    Subd. 3. Restrictions during suspension. When the certificate of authority of a health
maintenance organization is suspended, the health maintenance organization shall not, during
the period of such suspension, enroll any additional enrollees except newborn children or other
newly acquired dependents of existing enrollees, and shall not engage in any advertising or
solicitation whatsoever.
    Subd. 4. Restrictions upon revocation. When the certificate of authority of a health
maintenance organization is revoked, the organization shall proceed, immediately following the
effective date of the order of revocation, to wind up its affairs, and shall conduct no further
business except as may be essential to the orderly conclusion of the affairs of the organization. It
shall engage in no further advertising or solicitation whatsoever. The commissioner of health may,
by written order, permit further operation of the organization as the commissioner may find to be
in the best interest of enrollees, to the end that enrollees will be afforded the greatest practical
opportunity to obtain continuing health care coverage.
History: 1973 c 670 s 15; 1977 c 305 s 45; 1984 c 464 s 38; 1986 c 444; 1987 c 384 art 2 s 1
62D.16 DENIAL, SUSPENSION, AND REVOCATION; ADMINISTRATIVE
PROCEDURES.
    Subdivision 1. Notice and hearing. When the commissioner of health has cause to believe
that grounds for the denial, suspension or revocation of a certificate of authority exists, the
commissioner shall notify the health maintenance organization in writing specifically stating the
grounds for denial, suspension or revocation and fixing a time of at least 20 days thereafter for a
hearing on the matter, except in summary proceedings as provided in section 62D.18.
    Subd. 2. Written findings. After such hearing, or upon the failure of the health maintenance
organization to appear at the hearing, the commissioner of health shall take action as is deemed
advisable and shall issue written findings which shall be mailed to the health maintenance
organization. The action of the commissioner of health shall be subject to judicial review pursuant
to chapter 14.
History: 1973 c 670 s 16; 1977 c 305 s 45; 1982 c 424 s 130; 1986 c 444
62D.17 PENALTIES AND ENFORCEMENT.
    Subdivision 1. Administrative penalty. The commissioner of health may, for any violation
of statute or rule applicable to a health maintenance organization, or in lieu of suspension or
revocation of a certificate of authority under section 62D.15, levy an administrative penalty in an
amount up to $25,000 for each violation. In the case of contracts or agreements made pursuant to
section 62D.05, subdivisions 2 to 4, each contract or agreement entered into or implemented in a
manner which violates sections 62D.01 to 62D.30 shall be considered a separate violation. In
determining the level of an administrative penalty, the commissioner shall consider the following
factors:
(1) the number of enrollees affected by the violation;
(2) the effect of the violation on enrollees' health and access to health services;
(3) if only one enrollee is affected, the effect of the violation on that enrollee's health;
(4) whether the violation is an isolated incident or part of a pattern of violations; and
(5) the economic benefits derived by the health maintenance organization or a participating
provider by virtue of the violation.
Reasonable notice in writing to the health maintenance organization shall be given of the
intent to levy the penalty and the reasons therefor, and the health maintenance organization may
have 15 days within which to file a written request for an administrative hearing and review of
the commissioner of health's determination. Such administrative hearing shall be subject to
judicial review pursuant to chapter 14. If an administrative penalty is levied, the commissioner
must divide 50 percent of the amount among any enrollees affected by the violation, unless the
commissioner certifies in writing that the division and distribution to enrollees would be too
administratively complex or that the number of enrollees affected by the penalty would result in
a distribution of less than $50 per enrollee.
    Subd. 2. Criminal penalty. Any person who violates sections 62D.01 to 62D.30 or
knowingly submits false information in any report required hereunder shall be guilty of a
misdemeanor.
    Subd. 3. Alternative proceedings. (a) If the commissioner of health shall, for any reason,
have cause to believe that any violation of sections 62D.01 to 62D.30 has occurred or is
threatened, the commissioner of health may, before commencing action under sections 62D.15
and 62D.16, and subdivision 1, give notice to the health maintenance organization and to the
representatives, or other persons who appear to be involved in such suspected violation, to arrange
a voluntary conference with the alleged violators or their authorized representatives for the
purpose of attempting to ascertain the facts relating to such suspected violation and, in the event it
appears that any violation has occurred or is threatened, to arrive at an adequate and effective
means of correcting or preventing such violation.
(b) Proceedings under this subdivision shall not be governed by any formal procedural
requirements, and may be conducted in such manner as the commissioner of health may deem
appropriate under the circumstances.
    Subd. 4. Cease and desist order; hearing; stay. (a) The commissioner of health may issue
an order directing a health maintenance organization or a representative of a health maintenance
organization to cease and desist from engaging in any act or practice in violation of the provisions
of sections 62D.01 to 62D.30.
(1) The cease and desist order may direct a health maintenance organization to pay for or
provide a service when that service is required by statute or rule to be provided.
(2) The commissioner may issue a cease and desist order directing a health maintenance
organization to pay for a service that is required by statute or rule to be provided, only if there is a
demonstrable and irreparable harm to the public or an enrollee.
(3) If the cease and desist order involves a dispute over the medical necessity of a procedure
based on its experimental nature, the commissioner may issue a cease and desist order only if
the following conditions are met:
(i) the commissioner has consulted with appropriate and identified experts;
(ii) the commissioner has reviewed relevant scientific and medical literature; and
(iii) the commissioner has considered all other relevant factors including whether final
approval of the technology or procedure has been granted by the appropriate government agency;
the availability of scientific evidence concerning the effect of the technology or procedure on
health outcomes; the availability of scientific evidence that the technology or procedure is as
beneficial as established alternatives; and the availability of evidence of benefit or improvement
without the technology or procedure.
(b) Within 20 days after service of the order to cease and desist, the respondent may request
a hearing on the question of whether acts or practices in violation of sections 62D.01 to 62D.30
have occurred. Such hearings shall be subject to judicial review as provided by chapter 14.
If the acts or practices involve violation of the reporting requirements of section 62D.08,
or if the commissioner has ordered the rehabilitation, liquidation, or conservation of the health
maintenance organization in accordance with section 62D.18, the health maintenance organization
may request an expedited hearing on the matter. The hearing shall be held within 15 days of the
request. Within ten days thereafter, an administrative law judge shall issue a recommendation
on the matter. The commissioner shall make a final determination on the matter within ten days
of receipt of the administrative law judge's recommendation.
When a request for a stay accompanies the hearing request, the matter shall be referred
to the Office of Administrative Hearings within three working days of receipt of the request.
Within ten days thereafter, an administrative law judge shall issue a recommendation to grant or
deny the stay. The commissioner shall grant or deny the stay within five days of receipt of the
administrative law judge's recommendation.
To the extent the acts or practices alleged do not involve (1) violations of section 62D.08; (2)
violations which may result in the financial insolvency of the health maintenance organization; (3)
violations which threaten the life and health of enrollees; (4) violations which affect whole classes
of enrollees; or (5) violations of benefits or service requirements mandated by law; if a timely
request for a hearing is made, the cease and desist order shall be stayed for a period of 90 days
from the date the hearing is requested or until a final determination is made on the order, whichever
is earlier. During this stay, the respondent may show cause why the order should not become
effective upon the expiration of the stay. Arguments on this issue shall be made through briefs
filed with the administrative law judge no later than ten days prior to the expiration of the stay.
    Subd. 5. Injunctive relief. In the event of noncompliance with a cease and desist order
issued pursuant to subdivision 4, the commissioner of health may institute a proceeding to obtain
injunctive relief or other appropriate relief in Ramsey County District Court.
History: 1973 c 670 s 17; 1977 c 305 s 45; 1982 c 424 s 130; 1984 c 464 s 39; 1984 c 640
s 32; 1984 c 641 s 6; 1987 c 384 art 2 s 1; 1988 c 434 s 15; 1990 c 538 s 27,28; 1Sp2001 c 9
art 16 s 3; 2002 c 379 art 1 s 113
62D.18 REHABILITATION OR LIQUIDATION OF HEALTH MAINTENANCE
ORGANIZATION.
    Subdivision 1. Commissioner of health; order. The commissioner of health may apply by
verified petition to the district court of Ramsey County or the county in which the principal
office of the health maintenance organization is located for an order directing the commissioner
of health to rehabilitate or liquidate a health maintenance organization. The rehabilitation or
liquidation of a health maintenance organization shall be conducted under the supervision of the
commissioner of health under the procedures, and with the powers granted to a rehabilitator or
liquidator, in chapter 60B, except to the extent that the nature of health maintenance organizations
renders the procedures or powers clearly inappropriate and as provided in this subdivision or in
chapter 60B. A health maintenance organization shall be considered an insurance company for the
purposes of rehabilitation or liquidation as provided in subdivisions 4, 6, and 7.
    Subd. 2.[Repealed, 1990 c 538 s 32]
    Subd. 3.[Repealed, 1990 c 538 s 32]
    Subd. 4. Powers of rehabilitator. The powers of the rehabilitator include, subject to the
approval of the court the power to change premium rates, without the notice requirements of
section 62D.07, and the power to amend the terms of provider contracts, and of contracts with
participating entities for the provision of administrative, financial, or management services,
relating to reimbursement and termination, considering the interests of providers and other
contracting participating entities and the continued viability of the health plan.
If the court approves a contract amendment that diminishes the compensation of a provider
or of a participating entity providing administrative, financial, or management services to the
health maintenance organization, the amendment may not be effective for more than 60 days and
shall not be renewed or extended.
    Subd. 5.[Repealed, 1990 c 538 s 32]
    Subd. 6. Special examiner. The commissioner as rehabilitator shall make every reasonable
effort to employ a senior executive from a successful health maintenance organization to serve
as special examiner to rehabilitate the health maintenance organization, provided that the
individual does not have a conflict of interest. The special examiner shall have all the powers of
the rehabilitator granted under this section and section 60B.17.
    Subd. 7. Examination account. The commissioner of health shall assess against a health
maintenance organization not yet in rehabilitation or liquidation a fee sufficient to cover the costs
of a special examination. The fee must be deposited in an examination account. Money in the
account is appropriated to the commissioner of health to pay for the examinations. If the money
in the account is insufficient to pay the initial costs of examinations, the commissioner may use
other money appropriated to the commissioner, provided the other appropriation is reimbursed
from the examination account when it contains sufficient money. Money from the examination
account must be used to pay per diem salaries and expenses of special examiners, including
meals, lodging, laundry, transportation, and mileage. The salary of regular employees of the
Health Department must not be paid out of the account.
History: 1973 c 670 s 18; 1977 c 305 s 45; 1983 c 289 s 114 subd 1; 1984 c 655 art 1 s 92;
1988 c 612 s 23; 1990 c 538 s 29
62D.181 INSOLVENCY; MCHA ALTERNATIVE COVERAGE.
    Subdivision 1. Definition. "Association" means the Minnesota Comprehensive Health
Association created in section 62E.10.
    Subd. 2. Eligible individuals. An individual is eligible for alternative coverage under this
section if:
(1) the individual had individual health coverage through a health maintenance organization
or community integrated service network, the coverage is no longer available due to the
insolvency of the health maintenance organization or community integrated service network, and
the individual has not obtained alternative coverage; or
(2) the individual had group health coverage through a health maintenance organization or
community integrated service network, the coverage is no longer available due to the insolvency
of the health maintenance organization or community integrated service network, and the
individual has not obtained alternative coverage.
    Subd. 3. Application and issuance. If a health maintenance organization or community
integrated service network will be liquidated, individuals eligible for alternative coverage under
subdivision 2 may apply to the association to obtain alternative coverage. Upon receiving an
application and evidence that the applicant was enrolled in the health maintenance organization
or community integrated service network at the time of an order for liquidation, the association
shall issue policies to eligible individuals, without the limitation on preexisting conditions
described in section 62E.14, subdivision 3.
    Subd. 4. Coverage. Alternative coverage issued under this section must be at least a number
two qualified plan, as described in section 62E.06, subdivision 2, or for individuals over age 65, a
basic Medicare supplement plan, as described in section 62A.316.
    Subd. 5. Premium. The premium for alternative coverage issued under this section must not
exceed 80 percent of the premium for the comparable coverage offered by the association.
    Subd. 6. Duration. The duration of alternative coverage issued under this section is:
(1) for individuals eligible under subdivision 2, clause (1), 90 days; and
(2) for individuals eligible under subdivision 2, clause (2), 90 days or the length of time
remaining in the group contract with the insolvent health maintenance organization or community
integrated service network, whichever is greater.
    Subd. 7. Replacement coverage; limitations. The association is not obligated to offer
replacement coverage under this chapter or conversion coverage under section 62E.16 at the end
of the periods specified in subdivision 6. Any continuation obligation arising under this chapter or
chapter 62A will cease at the end of the periods specified in subdivision 6.
    Subd. 8. Claims expenses exceeding premiums. Claims expenses resulting from the
operation of this section which exceed premiums received shall be borne by contributing members
of the association in accordance with section 62E.11, subdivision 5.
    Subd. 9. Coordination of policies. If an insolvent health maintenance organization or
community integrated service network has insolvency insurance coverage at the time of an order
for liquidation, the association may coordinate the benefits of the policy issued under this section
with those of the insolvency insurance policy available to the enrollees. The premium level
for the combined association policy and the insolvency insurance policy may not exceed those
described in subdivision 5.
History: 1988 c 612 s 24; 1989 c 258 s 11; 1995 c 234 art 1 s 6-9; 1997 c 225 art 2 s 62
62D.182 LIABILITIES.
Every health maintenance organization shall maintain liabilities estimated in the aggregate to
be sufficient to pay all reported or unreported claims incurred that are unpaid and for which the
organization is liable. Liabilities are computed under rules adopted by the commissioner.
History: 1988 c 612 s 25
62D.19 UNREASONABLE EXPENSES.
No health maintenance organization shall incur or pay for any expense of any nature which
is unreasonably high in relation to the value of the service or goods provided. The commissioner
of health shall implement and enforce this section by rules adopted under this section.
In an effort to achieve the stated purposes of sections 62D.01 to 62D.30; in order to
safeguard the underlying nonprofit status of health maintenance organizations; and to ensure that
the payment of health maintenance organization money to major participating entities results in a
corresponding benefit to the health maintenance organization and its enrollees, when determining
whether an organization has incurred an unreasonable expense in relation to a major participating
entity, due consideration shall be given to, in addition to any other appropriate factors, whether
the officers and trustees of the health maintenance organization have acted with good faith and
in the best interests of the health maintenance organization in entering into, and performing
under, a contract under which the health maintenance organization has incurred an expense. The
commissioner has standing to sue, on behalf of a health maintenance organization, officers or
trustees of the health maintenance organization who have breached their fiduciary duty in entering
into and performing such contracts.
History: 1973 c 670 s 19; 1983 c 289 s 114 subd 1; 1984 c 464 s 41; 1984 c 655 art 1 s
92; 1Sp1985 c 10 s 62; 1987 c 384 art 2 s 1; 1988 c 612 s 26
62D.20 RULES.
    Subdivision 1. Rulemaking. The commissioner of health may, pursuant to chapter 14,
promulgate such reasonable rules as are necessary or proper to carry out the provisions of
sections 62D.01 to 62D.30. Included among such rules shall be those which provide minimum
requirements for the provision of comprehensive health maintenance services, as defined in
section 62D.02, subdivision 7, and reasonable exclusions therefrom. Nothing in such rules shall
force or require a health maintenance organization to provide elective, induced abortions, except
as medically necessary to prevent the death of the mother, whether performed in a hospital, other
abortion facility, or the office of a physician; the rules shall provide every health maintenance
organization the option of excluding or including elective, induced abortions, except as medically
necessary to prevent the death of the mother, as part of its comprehensive health maintenance
services.
    Subd. 2. Prior authorization. The commissioner shall adopt rules that address the issue of
appropriate prior authorization requirements, considering enrollee needs, administrative concerns,
and the nature of the benefit.
History: 1973 c 670 s 20; 1977 c 305 s 45; 1981 c 122 s 2; 1982 c 424 s 130; 1985 c 248 s
70; 1987 c 384 art 2 s 1; 1988 c 434 s 16; 1988 c 592 s 10; 1997 c 205 s 16
62D.21 FEES.
Every health maintenance organization subject to sections 62D.01 to 62D.30 shall pay to
the commissioner of health fees as prescribed by the commissioner of health pursuant to section
144.122 for the following:
(a) filing an application for a certificate of authority;
(b) filing an amendment to a certificate of authority;
(c) filing each annual report; and
(d) other filings, as specified by rule.
History: 1973 c 670 s 21; 1975 c 310 s 1; 1977 c 305 s 45; 1985 c 248 s 70; 1987 c 384 art
2 s 1
62D.211 RENEWAL FEE.
Each health maintenance organization subject to sections 62D.01 to 62D.30 shall submit to
the commissioner of health each year before June 15 a certificate of authority renewal fee in the
amount of $10,000 each plus 20 cents per person enrolled in the health maintenance organization
on December 31 of the preceding year. The commissioner may adjust the renewal fee in rule
under the provisions of chapter 14.
History: 1987 c 384 art 2 s 1; 1987 c 403 art 2 s 2; 1990 c 538 s 30
62D.22 STATUTORY CONSTRUCTION AND RELATIONSHIP TO OTHER LAWS.
    Subdivision 1. Applicability. Except as otherwise provided herein, sections 62D.01 to
62D.30 do not apply to an insurer or nonprofit health service plan corporation licensed and
regulated pursuant to the laws governing such corporations in this state.
    Subd. 2. Solicitation of enrollees. Solicitation of enrollees by a health maintenance
organization granted a certificate of authority, or its representatives, shall not be construed to
violate any provision of law relating to solicitation or advertising by health professionals.
    Subd. 3. Not practicing a healing art. Any health maintenance organization authorized
under sections 62D.01 to 62D.30 shall not be deemed to be practicing a healing art.
    Subd. 4. Federal law. To the extent that it furthers the purposes of sections 62D.01 to
62D.30, the commissioner of health shall attempt to coordinate the operations of sections 62D.01
to 62D.30 relating to the quality of health care services with the operations of United States
Code, title 42, sections 1320c to 1320c-20.
    Subd. 5. Other state law. Except as otherwise provided in sections 62A.01 to 62A.42
and 62D.01 to 62D.30, and except as they eliminate elective, induced abortions, wherever
performed, from health or maternity benefits, provisions of the insurance laws and provisions of
nonprofit health service plan corporation laws shall not be applicable to any health maintenance
organization granted a certificate of authority under sections 62D.01 to 62D.30.
    Subd. 6.[Repealed, 1982 c 614 s 12]
    Subd. 7. Prepaid group practice plan. A licensed health maintenance organization shall be
deemed to be a prepaid group practice plan for the purposes of chapter 43A and may be allowed to
participate as a carrier for state employees subject to any collective bargaining agreement entered
into pursuant to chapter 179A and reasonable restrictions applied pursuant to section 43A.23.
    Subd. 8. Insurance agents. All agents, solicitors, and brokers engaged in soliciting or
dealing with enrollees or prospective enrollees of a health maintenance organization, whether
employees or under contract to the health maintenance organization, shall be subject to the
provisions of sections 60K.30 to 60K.56, concerning the licensure of insurance producers and
lawful rules thereunder. Medical doctors and others who merely explain the operation of health
maintenance organizations shall be exempt from the provisions of sections 60K.30 to 60K.56.
Section 60K.37, subdivision 1, shall not apply except as to provide for an examination of
an applicant in the applicant's knowledge concerning the operations and benefits of health
maintenance organizations and related insurance matters.
    Subd. 9.[Repealed, 1984 c 464 s 46]
    Subd. 10. Access to data. Any person or committee conducting a review of a health
maintenance organization or a participating entity, pursuant to sections 62D.01 to 62D.30, shall
have access to any data or information necessary to conduct the review. All data or information
is subject to admission into evidence in any civil action initiated by the commissioner of health
against the health maintenance organization. The data and information are subject to chapter 13.
History: 1973 c 670 s 22; 1974 c 284 s 6; 1977 c 305 s 45; 1979 c 332 art 1 s 57; 1980 c
617 s 18; 1981 c 122 s 3; 1981 c 210 s 54; 1Sp1981 c 4 art 1 s 50; 1984 c 464 s 42,43; 1985 c
248 s 70; 1Sp1985 c 17 s 10; 1986 c 444; 1Sp1986 c 3 art 1 s 8; 1987 c 384 art 2 s 1; 1992 c
564 art 3 s 23; 2001 c 117 art 2 s 9
62D.23 FILINGS AND REPORTS AS PUBLIC DOCUMENTS.
All applications, filings, and reports required under sections 62D.01 to 62D.30 shall be
treated as public documents.
History: 1973 c 670 s 23; 1987 c 384 art 2 s 1
62D.24 STATE COMMISSIONER OF HEALTH'S AUTHORITY TO CONTRACT.
The commissioner of health, in carrying out the obligations under sections 62D.01 to
62D.30, may contract with the commissioner of commerce or other qualified persons to make
recommendations concerning the determinations required to be made. Such recommendations
may be accepted in full or in part by the commissioner of health.
History: 1973 c 670 s 24; 1977 c 305 s 45; 1983 c 289 s 114 subd 1; 1984 c 655 art 1 s 92;
1986 c 444; 1987 c 384 art 2 s 1
62D.25 [Repealed, 1Sp1985 c 9 art 2 s 104]
62D.26 [Repealed, 1Sp1985 c 9 art 2 s 104]
62D.27 [Repealed, 1984 c 464 s 46]
62D.28 [Repealed, 1Sp1985 c 9 art 2 s 104]
62D.29 [Repealed, 1Sp1985 c 9 art 2 s 104]
62D.30 DEMONSTRATION PROJECTS.
    Subdivision 1. Projects allowed. The commissioner of health may establish demonstration
projects to allow health maintenance organizations to extend coverage to:
(a) individuals enrolled in Part A or Part B, or both, of the Medicare program, Title XVIII of
the Social Security Act, United States Code, title 42, section 1395 et seq.;
(b) groups of fewer than 50 employees where each group is covered by a single group
health policy;
(c) individuals who are not eligible for enrollment in any group health maintenance
contracts; and
(d) low income population groups.
For purposes of this section, the commissioner of health may waive compliance with
minimum benefits pursuant to sections 62A.151 and 62D.02, subdivision 7, full financial risk
pursuant to section 62D.04, subdivision 1, clause (f), open enrollment pursuant to section 62D.10,
and to applicable rules if there is reasonable evidence that the rules prohibit the operation of the
demonstration project. The commissioner shall provide for public comment before any statute or
rule is waived.
    Subd. 2. Minimum health benefits required. A demonstration project must provide health
benefits equal to or exceeding the level of benefits provided in Title XVIII of the Social Security
Act and an out of hospital prescription drug benefit. The out of hospital prescription drug benefit
may be waived by the commissioner if the health maintenance organization presents evidence
satisfactory to the commissioner that the inclusion of the benefit would restrict the operation of
the demonstration project.
    Subd. 3. Application. A health maintenance organization electing to participate in a
demonstration project shall apply to the commissioner for approval on a form developed by the
commissioner. The application shall include at least the following:
(a) a statement identifying the population that the project is designed to serve;
(b) a description of the proposed project including a statement projecting a schedule of
costs and benefits for the enrollee;
(c) reference to the sections of Minnesota Statutes and Department of Health rules for which
waiver is requested;
(d) evidence that application of the requirements of applicable Minnesota Statutes and
Department of Health rules would, unless waived, prohibit the operation of the demonstration
project;
(e) evidence that another arrangement is available for assumption of full financial risk if full
financial risk is waived under subdivision 1;
(f) an estimate of the number of years needed to adequately demonstrate the project's
effects; and
(g) other information the commissioner may reasonably require.
    Subd. 4. Consideration of application. The commissioner shall approve, deny, or refer back
to the health maintenance organization for modification, the application for a demonstration
project within 60 days of receipt from the health maintenance organization.
    Subd. 5. Term of project. The commissioner may approve an application for a demonstration
project for a maximum of six years, with an option to renew.
    Subd. 6. Annual report. Each health maintenance organization for which a demonstration
project is approved shall annually file a report with the commissioner summarizing the project's
experience at the same time it files its annual report required by section 62D.08. The report
shall be on a form developed by the commissioner and shall be separate from the annual report
required by section 62D.08.
    Subd. 7. Approval rescission. The commissioner may rescind approval of a demonstration
project if the commissioner makes any of the findings listed in section 62D.15, subdivision
1
, with respect to the project for which it has not been granted a specific exemption, or if the
commissioner finds that the project's operation is contrary to the information contained in the
approved application.
    Subd. 8. Rural demonstration project. (a) The commissioner may permit demonstration
projects to allow health maintenance organizations to extend coverage to a health improvement
and purchasing coalition located in rural Minnesota, comprised of the health maintenance
organization and members from a geographic area. For purposes of this subdivision, rural is
defined as greater Minnesota excluding the seven-county metropolitan area of Anoka, Carver,
Dakota, Hennepin, Ramsey, Scott, and Washington. The coalition must be designed in such
a way that members will:
(1) become better informed about health care trends and cost increases;
(2) be actively engaged in the design of health benefit options that will meet the needs
of their community;
(3) pool their insurance risk;
(4) purchase these products from the health maintenance organization involved in the
demonstration project; and
(5) actively participate in health improvement decisions for their community.
(b) The commissioner must consider the following when approving applications for rural
demonstration projects:
(1) the extent of consumer involvement in development of the project;
(2) the degree to which the project is likely to reduce the number of uninsured or to maintain
existing coverage; and
(3) a plan to evaluate and report to the commissioner and legislature as prescribed by
paragraph (e).
(c) For purposes of this subdivision, the commissioner must waive compliance with the
following statutes and rules: the cost-sharing restrictions under section 62D.095, subdivisions 2,
3, and 4
, and Minnesota Rules, part 4685.0801, subparts 1 to 7; for a period of at least two years,
participation in government programs under section 62D.04, subdivision 5, in the counties of the
demonstration project if that compliance would have been required solely due to participation in
the demonstration project and shall continue to waive this requirement beyond two years if the
enrollment in the demonstration project is less than 10,000 enrollees; small employer marketing
under section 62L.05, subdivisions 1 to 3; and small employer geographic premium variations
under section 62L.08, subdivision 4. The commissioner shall approve enrollee cost-sharing
features desired by the coalition that appropriately share costs between employers, individuals,
and the health maintenance organization.
(d) The health maintenance organization may make the starting date of the project contingent
upon a minimum number of enrollees as cited in the application, provide for an initial term of
contract with the purchasers of a minimum of three years, and impose a reasonable penalty for
employers who withdraw early from the project. For purposes of this subdivision, loss ratios
are to be determined as if the policies issued under this section are considered individual or
small employer policies pursuant to section 62A.021, subdivision 1, paragraph (f). The health
maintenance organization may consider businesses of one to be a small employer under section
62L.02, subdivision 26. The health maintenance organization may limit enrollment and establish
enrollment criteria for businesses of one. Health improvement and purchasing coalitions under
this subdivision are not associations under section 62L.045, subdivision 1, paragraph (a).
(e) The health improvement and purchasing coalition must report to the commissioner and
legislature annually on the progress of the demonstration project and, to the extent possible,
any significant findings in the criteria listed in clauses (1), (2), and (3) for the final report. The
coalition must submit a final report five years from the starting date of the project. The final report
must detail significant findings from the project and must include, to the extent available, but
should not be limited to, information on the following:
(1) the extent to which the project had an impact on the number of uninsured in the project
area;
(2) the effect on health coverage premiums for groups in the project's geographic area,
including those purchasing health coverage outside the health improvement and purchasing
coalition; and
(3) the degree to which health care consumers were involved in the development and
implementation of the demonstration project.
(f) The commissioner must limit the number of demonstration projects under this subdivision
to five projects.
(g) Approval of the application for the demonstration project is deemed to be in compliance
with section 62E.06, subdivisions 1, paragraph (a), 2, and 3.
(h) Subdivisions 2 to 7 apply to demonstration projects under this subdivision. Waivers
permitted under subdivision 1 do not apply to demonstration projects under this subdivision.
(i) If a demonstration project under this subdivision works in conjunction with a purchasing
alliance formed under chapter 62T, that chapter will apply to the purchasing alliance except to the
extent that chapter 62T is inconsistent with this subdivision.
History: 1979 c 268 s 1; 2002 c 346 s 1; 2002 c 387 s 4; 2006 c 212 art 3 s 3