2005 Minnesota Statutes

     62Q.74 Network shadow contracting. 

    Subdivision 1.    Definitions.  (a) For purposes of this 
 section, "category of coverage" means one of the following types 
 of health-related coverage: 

    (1) health; 

    (2) no-fault automobile medical benefits; or 

    (3) workers' compensation medical benefits. 

    (b) "Health care provider" or "provider" means a physician, 
 chiropractor, dentist, podiatrist, hospital, ambulatory surgical 
 center, freestanding emergency room, or other provider, as 
 defined in section 62J.03. 

    Subd. 2.    Provider consent required.  (a) No health 
 plan company shall require a health care provider to participate 
 in a network under a category of coverage that differs from the 
 category or categories of coverage to which the existing 
 contract between the health plan company and the provider 
 applies, without the affirmative consent of the provider 
 obtained under subdivision 3.  

    (b) No health plan company shall require, as a condition of 
 participation in any health plan, product, or other arrangement, 
 the provider to participate in a new or different health plan, 
 product, or other arrangement within a category of coverage that 
 results in a different underlying financial reimbursement 
 methodology without the affirmative consent of the provider 
 obtained under subdivision 3.  This paragraph does not apply to 
 participation in health plan products or other arrangements that 
 provide health care services to government programs, including 
 state public programs, Medicare, and Medicare-related coverage. 

    (c) Compliance with this section may not be waived in a 
 contract or otherwise. 

    Subd. 3.    Consent procedure.  (a) The health plan 
 company, if it wishes to apply an existing contract with a 
 provider to a different category of coverage or health plan, 
 product, or other arrangement within a category of coverage that 
 results in a different underlying financial reimbursement 
 methodology, shall first notify the provider in writing.  The 
 written notice must include at least the following: 

    (1) the health plan company's name, address, and telephone 
 number, and the name of the specific network, if it differs from 
 that of the health plan company; 

    (2) a description of the proposed new category of coverage 
 or health plan, product, or other arrangement within a category 
 of coverage; 

    (3) the names of all payers expected by the health plan 
 company to use the network for the new category of coverage or 
 health plan, product, or other arrangement within a category of 
 coverage; 

    (4) the approximate number of current enrollees of the 
 health plan company in that category of coverage or health plan, 
 product, or other arrangement within a category of coverage 
 within the provider's geographical area; 

    (5) a disclosure of all contract terms of the proposed new 
 category of coverage or health plan, product, or other 
 arrangement within a category of coverage, including the 
 discount or reduced fees, care guidelines, utilization review 
 criteria, prior notification process, prior authorization 
 process, and dispute resolution process; 

    (6) a form for the provider's convenience in accepting or 
 declining participation in the proposed new category of coverage 
 or health plan, product, or other arrangement within a category 
 of coverage, provided that the provider need not use that form 
 in responding; and 

    (7) a statement informing the provider of the provisions of 
 paragraph (b). 

    (b) Unless the provider has affirmatively agreed to 
 participate within 60 days after the postmark date of the 
 notice, the provider is deemed to have not accepted the proposed 
 new category of coverage or health plan, product, or other 
 arrangement within a category of coverage that results in a 
 different underlying financial reimbursement methodology. 

    Subd. 4.    Contract termination restricted.  A health 
 plan company must not terminate an existing contract with a 
 provider, or fail to honor the contract in good faith, based 
 solely on the provider's decision not to accept a proposed new 
 category of coverage or health plan, product, or other 
 arrangement within a category of coverage that results in a 
 different underlying financial reimbursement methodology.  The 
 most recent agreed-upon contractual obligations remain in force 
 until the existing contract's renewal or termination date. 

    Subd. 5.    Remedy.  If a health plan company violates 
 this section by reimbursing a provider as if the provider had 
 agreed under this section to participate in the network under a 
 category of coverage or health plan, product, or other 
 arrangement within a category of coverage that results in a 
 different underlying financial reimbursement methodology to 
 which the provider has not agreed, the provider has a cause of 
 action against the health plan company to recover two times the 
 difference between the reasonable charges for claims affected by 
 the violation and the amounts actually paid to the provider.  
 The provider is also entitled to recover costs, disbursements, 
 and reasonable attorney fees. 

    Subd. 6.    Benefit design changes.  For purposes of 
 this section, "different underlying financial reimbursement 
 methodology" does not include health plan benefit design 
 changes, including, but not limited to, changes in co-payment or 
 deductible amounts or other changes in member cost-sharing 
 requirements. 

    HIST: 1999 c 94 s 1; 2000 c 322 s 1; 2001 c 170 s 4,5; 2004 c 
 246 s 9 

*   NOTE:  The amendment to this section by Laws 2004, chapter 
*246, section 9, is effective for provider contracts issued, 
*renewed, or amended on or after July 1, 2006.  Laws 2004, 
*chapter 246, section 12.