Skip to main content Skip to office menu Skip to footer
Minnesota Legislature

Office of the Revisor of Statutes

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