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H.F. No. 5 - Minnesota Insurance Marketplace Act, (Conference Committee Report)
 
Author: Senator Tony Lourey
 
Prepared By:
 
Date: March 15, 2013



 

Section 1 (13.7191, subdivision 14a) specifies in chapter 13 that the classification and sharing of data of the Minnesota Insurance Marketplace is governed by section 62V.06.

Section 2 (13D.08, subdivision 5a) specifies in the open meeting chapter (13D) that the meetings of the Minnesota Insurance Marketplace are governed under section 62V.03.

Section 3 (62V.01) states that this chapter (62V) may be cited as the "Minnesota Insurance Marketplace Act."

Section 4 (62V.02) defines the following terms:  board; dental plan; health plan; health carrier; individual market; insurance provider; Minnesota Insurance Marketplace; navigator; public health care program; qualified health plan; small group market; and Web site.

Section 5 (62V.03) creates the Minnesota Insurance Marketplace.

Subdivision 1 creates the Minnesota Insurance Marketplace as a board with the following duties to:

 (1) promote informed consumer choice, innovation, competition, quality, value, market participation, affordability, meaningful choices, health improvement, care management, reduction of health disparities, and portability of health plans;

 (2) facilitate and simplify the comparison, choice, enrollment, and purchase of health plans for individuals purchasing in the individual market and employees and employers purchasing in the small group market through the Minnesota Insurance Marketplace;

 (3) assist small employers with access to small business health insurance tax credits and to assist individuals with access to public health care programs, premium assistance tax credits, cost-sharing reductions, and certificates of exemption from individual responsibility requirements;

 (4) facilitate the integration and transition of individuals between public health care programs and health plans in the individual market; and

(5) establish a name and brand for the Minnesota Insurance Marketplace. 

Subdivision 2 outlines the applicability of other laws in terms of the Minnesota Insurance Marketplace.

Paragraph (a) states that the Marketplace is subject to review by the legislative auditor under section 3.971.  Authorizes the legislative auditor to bill the Marketplace for the costs and expenses of the audit.  Authorizes the legislative auditor to report to the legislature on any duplication of services that occurs within state government as a result of the creation of the Marketplace.

Paragraph (b) states that board members are subject to sections 10A.07 (conflict of interest disclosure) and 10A.09 (statement of economic interest).  The board members and personnel are subject to section 10A.071 (gift ban). 

Paragraph (c) requires all meetings of the board to comply with the open meeting law with the exception of meetings regarding compensation negotiations; contract negotiations; and not public, or trade secret information. 

Paragraph (d) states that, except as specified elsewhere in this chapter, the Minnesota Insurance Marketplace is exempt from: (1) chapter 14 (administrative procedures), including section 14.386 (procedures for adopting exempt rules); and (2) the laws creating and governing the Department of Administration (chapter 16B) and those governing state procurement of goods and services (chapter 16C), except for specified sections relating to contracts for services and a section that requires efforts by state agencies to purchase from small businesses, including those owned by targeted group members and by veterans.  Requires also, however, that the exchange establish "an open and competitive procurement process" for the exchange that complies with those chapters to the extent practicable for the exchange.

Paragraph (e) exempts the board and the Web site from chapter 60K. (insurance producer licensure).  Requires employees of the Minnesota Insurance Marketplace who sell, solicits, or negotiates insurance to be licensed as insurance brokers under chapter 60K.

Paragraph (f) states that section 3.3005 applies to any federal funds received by the Minnesota Insurance Marketplace (Legislative Advisory Commission review).

Paragraph (g) exempts the Marketplace from several sections in chapter 16E (Office of Enterprise Technology).

Paragraph (h) defines a Marketplace decision that requires a vote of the board (other than decisions dealing with employees/internal management) as an "administrative action" under section 10A.01, subdivision 2 (thus triggering reporting of lobbying expenses and registering as a lobbyist for any lobbying efforts involved with administrative actions).

Subdivision 3.  Continued operation of a private marketplace.  States that nothing in this chapter shall be construed so as to:

(1) prohibit the offering outside of the Minnesota Insurance Marketplace of health plans to qualified individuals or qualified employers;

(2) prohibit a qualified employee from enrolling in, or a qualified employer from selecting, a health plan offered outside of the marketplace;

(3) restrict the choice of a qualified individual to enroll or not enroll in a qualified health plan or to participate in the marketplace; and

(4) compel an individual to enroll in a qualified health plan or to participate in the marketplace.

Section 6 (62V.04) describes the governance structure of the Marketplace.

Subdivision 1.  Board.  The Minnesota Insurance Marketplace is governed by a Board of Directors with seven members.

Subdivision 2.  Appointment.  The board members are appointed to a four-year term, following the initial staggered-term lot determination and are classified as follows:

(1) Of one group of three board members, one represents individual market consumers, one represents public program enrollees, and one represents small employers.  These members are appointed by the governor, with advice and consent of both the Senate and the House of Representatives, acting separately.

(2)  Of a second group of three board members, one member represents the areas of health administration, health care finance, health plan purchasing, and health care delivery systems; one represents the areas of public health, health disparities, public health care programs, and the uninsured; and one represents health policy issues relating to the small group and individual markets.  These members also are appointed by the governor, with advice and consent of both the Senate and the House of Representatives, acting separately.

(3)  The seventh board member is the Commissioner of Human Services or a designee.

Provides that section 15.0597, relating to the usual process for making appointments to public entities, applies to this appointment process, except for the commissioner and the initial appointments.  Requires that initial appointments be made by April 30, 2013.  Requires appointments to be consistent with federal law.  Provides that upon appointment, a board member shall exercise duties of office immediately, but that the appointment terminates if both the House and the Senate vote not to confirm.  Requires one of the six members appointed under clause (1) or (2) to have experience in representing the needs of vulnerable populations and persons with disabilities.  Also requires the board to include representation from outside of the seven-county metropolitan area.

Subdivision 3.  Terms. (a) Limits board members to no more than two consecutive terms, except for the commissioner or designee who serves until replaced by the governor.

(b)  Permits a board member to resign at any time.

(c)  Board members, not including the commissioner or designee, will initially serve an initial term of two, three, or four years determined by lot by the Secretary of State.

Subdivision 4.  Conflicts of interest. (a) Requires that board members appointed to the six positions other than the one reserved for the Commissioner of Human Services, not have, within one year before or during their appointment, any type of employment, service on a board of directors, or other representation position with any health carrier, institutional health care provider or other entity providing health care, navigator, insurance producer, or other entity that sells anything to or through the Minnesota Insurance Marketplace.  States that "health care provider" does not include academic institutions.

(b) Requires board members to recuse themselves from discussion and voting if the board member has a conflict of interest.

(c) Provides that a board member must not serve as a lobbyist, as defined in Minnesota Statutes, section 10A.01.

(d) specifies that no board remember shall have a spouse who is an executive of a health carrier.

Subdivision 5 requires the Governor to designate one of the appointees as the acting chair until the board elects a chair.  The board is required to hold its first meeting within 60 days of enactment, and elect a chair at the first meeting. 

Subdivision 6 requires the chair to be elected by a majority of members and specifies that the chair serves for one year.

Subdivision 7 requires the members of the board to elect officers by a majority of the members and specifies that the officers shall serve for one year.

Subdivision 8 sets out how a board vacancy is to be filled. 

Subdivision 9 states that a board member may be removed only for cause by the appointing authority and a majority vote of the board, and that a conflict of interest shall be cause for removal.

Subdivision 10 requires the board to meet at least quarterly.

Subdivision 11 describes what constitutes a quorum.

Subdivision 12, paragraph (a), authorizes compensation for the board members, capped by section 15A.0815, subdivision 4 (25 percent of the Governor's salary) until December 31, 2015.  The process for setting salaries is in accordance with section 15A.0815, subdivision 5 (appointing authority submits recommendations to the Legislative Coordinating Commission).

Paragraph (b) states that beginning January 1, 2016, compensation is in accordance with section 15.075 ($55 per day, plus expenses).

Subdivision 13 requires the board to establish the advisory committees required under federal law and authorizes the board to establish other advisory committees as necessary.  Permits the board to provide compensation and expense reimbursement to members of the advisory committees.

Section 7 (62V.05) describes the basic responsibilities of the Minnesota Insurance Marketplace.

Subdivision 1, paragraph (a), requires the Marketplace to implement and operate the Marketplace in accordance with this chapter and applicable state and federal laws.

Paragraph (b) authorizes the Marketplace to:

(1) employ personnel and delegate administrative, operational, and other responsibilities to the director and other personnel as deemed appropriate by the board; specifies that the director and managerial staff are unclassified and governed by a compensation plan prepared by the board, submitted to the Commissioner of Management and Budget for review and comment within 14 days of its receipt, and approved by the Legislative Coordinating Commission and the legislature;

(2) establish the budget for the Marketplace;

(3) seek and accept money, grants, loans, donations, materials, services, or advertising revenue from government agencies, philanthropic organizations, and public and private sources to fund the operation of the Marketplace.  Prohibits health carriers and insurance producers from advertising on the Minnesota Insurance Marketplace;

(4) contract for the receipt and provision of goods and services;

(5) enter into information-sharing agreements with state and federal agencies and other entities, provided as authorized under section 62V.06; and

(6) take any other actions reasonably necessary to implement and administer the requirements under this chapter and the ACA. 

Paragraph (c) establishes policies and procedures to gather public comment and provide public notice in the State Register.

Paragraph (d) requires the board within 180 days of enactment to establish bylaws, policies, and procedures governing the operations of the Minnesota Insurance Marketplace. 

Subdivision 2.  Operations funding.  (a) Prior to January 1, 2015, permits the board to retain or collect up to 1.5 percent of premiums from the individual and small group market premiums (not the public programs) to fund cash reserves of the marketplace, but limits the amount collected to 25 percent of the Minnesota Comprehensive Health Association (MCHA) assessments collected for CY 2012.

(b) Beginning January 1, 2015, permits the board to retain or collect up to 3.5 percent of premiums from the individual and small group market premiums (not the public programs) to fund operations of the marketplace, but limits the amount collected to 50 percent of the MCHA assessments collected for CY 2012.

(c) Beginning January 1, 2016, permits the board to retain or collect up to 3.5 percent of premiums from the individual and small group market premiums (not the public programs) to fund operations of the marketplace, but limits the annual growth in the amount collected or retained to the rate of inflation after accounting for year-to-year enrollment changes and provides that the amount may never exceed 100 percent of the MCHA assessments collected for CY 2012.

(d) Permits the Commissioner of Management and Budget to provide cash flow assistance of up to $20,000,000 from the special revenue fund or statutory general fund to the Marketplace for fiscal years 2014 and 2015.  Any funds provided must be repaid with interest by June 30, 2015.

(e) Requires the operations funding of the Minnesota Insurance Marketplace to cover any compensation for the navigator program.

Subdivision 3 establishes requirements for insurance producers assisting individuals and small employers purchasing coverage through the Marketplace.

Paragraph (a) requires the board,by April 30, 2013, in consultation with the Commissioner of Commerce, to establish certification requirements for insurance producers assisting individuals and small employers with coverage through the Marketplace.  

Paragraph (b) states that certification requirements must not exceed the requirements under federal law and specifies that certification must include training in areas required under the ACA.  Training required for certification shall qualify for continuing education requirements and must comply with course approval. 

Paragraph (c) states that the compensation paid to insurance producers must be similar for health plans offered or sold inside and outside of the Minnesota Insurance Marketplace.  Specifies that compensation must be set by the health carrier and not the board.

Paragraph (d) states that any compensation structure established by a health carrier for the group market must include compensation for defined contribution plans that involve multiple health carriers and that the compensation must be commensurate with other small group market defined health plans.

Paragraph (e) specifies that any insurance producer assisting an individual or small employer with purchasing coverage through the Minnesota Insurance Marketplace must disclose, orally and in writing, at the time of first solicitation the following:

  1. the health carriers and qualified health plans offered through the Minnesota Insurance Marketplace that the producer is authorized to sell and that the producer may not be authorized to sell all the health plans offered through the Marketplace;
  2. that the producer may be receiving compensation from a health carrier for enrolling the prospective buyer in a specific health plan; and
  3. information on all qualified health plans offered through the Marketplace is available through the Marketplace Web site.

Paragraph (f) requires health carriers that offer or sell qualified health plans through the Marketplace to report to the board and the Commissioner of Commerce the compensation offered or provided to the producers for each type of health plan the health carrier offers or sells inside and outside of the Marketplace.

Paragraph (g) provides that this chapter does not prohibit an insurance producer from offering advice to a small group purchaser.

Paragraph (h) requires an insurance producer that offers health plans in the small group market to notify each small group purchaser of which plans qualify for tax benefits under section 125 of the Internal Revenue Code, and of state laws that benefit small group plans when the employer agrees to pay 50 percent or more if its employees’ premiums.  Provides that persons who are eligible for cost effective medical assistance will count toward the 75 percent participation requirement in current law requiring guaranteed coverage for certain small employers.

Paragraph (i) states that nothing in this subdivision shall be construed to limit the licensure requirements or regulatory functions of the Commissioner of Commerce under chapter 60K.

Subdivision 4 establishes the policies and procedures for navigators, in-person assisters, call center, and customer services provisions.

Paragraph (a) authorizes the board to establish policies and procedures for the ongoing operation of a navigator program, in-person assister program, call center, and customer service provisions for the Marketplace to be implemented beginning January 1, 2015.

Paragraph (b) prior to the implementation of the policies and procedures described in paragraph (a), the following will be in effect:

(1) the navigator program will be met by section 256.962;

(2) entities eligible to be navigators may serve as in-person assisters;

(3) the board shall establish requirements and compensation for the navigator program and in-person assister program by April 30, 2013; and

 (4) call center operations shall utilize existing state resources and personnel, including referrals to counties for medical assistance.

Paragraph (c) requires the board to establish a toll free number for the Marketplace and authorizes the commissioner to hire and contract for additional resources as needed.

Paragraph (d) states that the navigator and in-person assister programs must meet federal requirements and that the training standards for the navigator and in-person assister programs include training in the needs of under-served and vulnerable populations, eligibility rules and regulations, available public health care programs, qualified health plan options available through the Marketplace, and privacy and security standards.  States that for calendar year 2014, the Commissioner of Human Services shall ensure that the navigator program provides application assistance for both qualified health plans offered through the Marketplace and the public health care programs.

Paragraph (e) ensures that any information provided by navigators, in-person assisters, the call center, or other customer assistance portals be accessible to persons with disabilities and include information on other available coverage options. 

Subdivision 5 establishes health carrier and health plan requirements.

Paragraph (a) authorizes the board to establish certification requirements for health carriers and health plans offered through the Marketplace beginning January 1, 2015.

Paragraph (b) states that paragraph (a) does not apply if the legislature enacts by June 1, 2013, regulatory requirements that:  (1) apply uniformly to all health carriers and health plans in the individual market; (2) apply uniformly to all health carriers and health plans in the small group market; and (3) satisfy federal certification requirements.

Paragraph (c) requires the board to establish policies and procedures for certification and selection of health plans to be offered through the Minnesota Insurance Marketplace.  The board shall certify and select a health plan as a qualified health plan if:  (1) the health plan meets the minimum federal certification requirements or meets the market regulatory requirements; (2) the board determines that making the health plan available through the Marketplace is in the interest of the qualified individuals and employers using the Marketplace; (3) the health carrier applying to offer the health plan through the Marketplace also applies to offer health plans at each actuarial level and service area that the health carrier currently offers in the individual and small group markets; and (4) the health carrier dos not apply to offer health plans in the individual and small group markets through the Marketplace under a separate license of a parent organization or holding company that is different from what the health carrier offers in the individual and small group market outside the Marketplace.

Paragraph (d) provides a list of areas that the board may consider in determining the interests of qualified individuals and small employers, including affordability, quality and value, promotion of prevention and wellness, promotion of initiatives that reduce health disparities, market stability and adverse selection, meaningful choices and access, alignment and coordination with state agency and private sector purchasing strategies and payment reform efforts, and other appropriate criteria.

Paragraph (e) states that for qualified health plans offered through the Marketplace, effective January 1, 2015, and after, the board is required to establish the criteria for determining whether offering a health plan is in the interests of individuals and employers by February 1 of each year beginning February 1, 2014.  The criteria must include the measure to be used by the board to determine whether the criteria have been met.  Permits the board to use the rulemaking process described under subdivision 8, paragraph (b), when establishing the selection criteria.

Paragraph (f) states that for qualified health plans offered through the Marketplace for 2014, the health plan must meet the certification requirements of the ACA.  Any health plan meeting these requirements is permitted to be offered through the Marketplace.

Paragraph (g) authorizes the board to verify that health carriers and health plans are properly certified to be eligible to participate in the Marketplace.

Paragraph (h) states that for qualified health plans offered through the Marketplace beginning January 1, 2015, health carriers are required to use the most current addendum for Indian health care providers approved by CMS and the tribes as part of their contracts with Indian health care providers.  Requires the Marketplace to comply with future changes in federal law with regard to health coverage for the tribes.

Subdivision 6.  Appeals.  Specifies the appeals procedures available in connection with appeals of determinations made by the marketplace.  Provides that this subdivision does not apply if a state agency appeal is available under section 256.045, which relates to the public health care programs.

Subdivision 7, paragraph (a), requires the board to establish and maintain the following agreements with:

 (1) the Office of Enterprise Technology for information technology services that ensures coordination with public health care programs and other information technology services;

 (2) the Commissioner of Human Services for cost allocation and service regarding eligibility determination and enrollment for public health care programs and for other services;

 (3) the Commissioners of Commerce and Health for services regarding enforcement of Marketplace certification requirements for health plans offered through the Marketplace and other services; and

 (4) establish interagency agreements to transfer funds to other state agencies for their costs related to the Marketplace. 

Paragraph (b) requires the board to consult with the Commissioners of Commerce and Health regarding the operations of the Marketplace.

Paragraph (c) requires the board to consult with Indian tribes regarding the operations of the Marketplace.

Paragraph (d) requires the board, beginning March 15, 2014, and each March 15 thereafter, to submit a report to the legislature on all agreements entered into in accordance with this subdivision.

Subdivision 8, paragraph (a), establishes a rulemaking process for the Marketplace to follow for policies, procedures, and other statements that are rules.

Paragraph (b) upon enactment until January 1, 2015, authorizes the following rulemaking process:  (1) publish notice of proposed rules in the State Register; (2) provide interested parties 21 days after publication to comment on the proposed rules.  After considering all comments, the Marketplace shall publish notice in the State Register of the final rule; (3) if the adopted rules are the same as the proposed rules, the notice must state that the rules have been adopted as proposed and shall cite the prior publication.  If the adopted rules differ from the proposed rules, the portions of the rules that differ from the proposed rules shall be included in the notice of adoption, together with a citation to the prior State Register that contained the notice of proposed rules; and (4) rules published in the State Register before January 1, 2014, take effect upon publication of the notice, rules published after January 1, 2014, take effect 30 days after publication.

Paragraph (c) authorizes the Marketplace to use an expedited rulemaking process (section 14.389) after January 1, 2015.

Paragraph (d) requires the notice of publication required under paragraph (b) to include information as to where the public may obtain a copy of the rules.  The board shall post the proposed rules on the Web site.

Subdivision 9 clarifies that dental plans are subject to the same provisions and certification requirements as health plans to the extent practicable.

Subdivision 10 states that the board shall not bear insurance risk or enter into any agreement with providers to pay claims.  States that this subdivision does not prohibit the board from providing insurance to its employees.

Section 8 (62V.06) Data practices.  Says that the Marketplace is a state agency for purposes of the Data Practices Act, and is subject to all provisions of chapter 13.   Defines terms.

Specifies the classification, status, and permitted use of government data held or obtained by the Marketplace on individuals, employees of employers, and employers that use the Marketplace.

Forbids the Marketplace from collecting data that indicates whether or not an individual owns guns or has a firearm in the individual's home.

Requires the Marketplace to provide a Tennesen warning, as provided in the Data Practices Act, to individuals asked to supply private data.  Also requires the Marketplace to give notice of a data subject’s rights related to handling of genetic information and notice of the records retention policy of the Marketplace.

Provides that only individuals with explicit authorization from the board may access not public data maintained by the Marketplace.  Specifies procedures to limit and to track access to data.  Provides that the board must revoke the authorization of any person who accesses data in violation of this section of chapter 13.  Requires that if an individual is determined to have willfully gained access to data without board authorization, the board must forward the matter to the county attorney.  Provides that these limits do not affect authority of the Legislative Auditor under current law or the right of a Marketplace participant to enter, update, or access data if the participant is the subject of the data.

Forbids the Marketplace from selling its data.

Section 9 (62V.07) states that the Minnesota Insurance Marketplace account is created in the special revenue fund and that all funds received by the Marketplace be deposited in the account.  The funds in the account are appropriated to the Marketplace. 

Section 10 (62V.08) requires the Marketplace to submit a report to the legislature by January 15, 2015, and each January 15 thereafter, on the performance of the Marketplace operations; meeting the Marketplace’s responsibilities; an accounting of the budget activities; practices and procedures that have been implemented to ensure compliance with data practice laws; and the effectiveness of the outreach and implementation activities of the Marketplace in reducing the rate of uninsured.  Also requires the Marketplace to publish its administrative and operational costs on the Web site, including the premiums and federal premium subsidies collected, the source of revenue received, the amount of other fees collected to support operations, and any misuse of funds identified.

Section 11 (62V.09) states that the board and its advisory committees do not expire, except as specified in section 62V.04, subdivision 13, and that the board and its advisory committees are not subject to review or sunsetting under chapter 3D. 

Section 12 (62V.10) provides that nothing in this chapter infringes on the right of a Minnesota citizen not to participate in the Marketplace.

Section 13 (62V.11) establishes a legislative oversight committee of five senators and five representatives to review the operations of the Minnesota Insurance Marketplace and recommend necessary changes in policy, implementation, and statutes to the board and legislature.  The committee is required to meet at least once a year and the Minnesota Insurance Marketplace is required to present to the committee its annual report, as well as all other required reports.  The estimated costs to fund the operations of the Marketplace must be submitted to the committee for review.  The proposed rules adopted under section 62V.05, subdivision 8, paragraph (b), must be submitted to the committee for review.

Section 14, paragraph (a) authorizes the Commissioner of Minnesota Management and Budget (MMB) to exercise all responsibilities of the Marketplace under sections 62V.03 and 62V.05, until the board has established bylaws, policies, and procedures as required under section 62V.05, subdivision 1, paragraph (d).  MMB is exempt from the same statutory provisions as the board (chapter 14, including section 14.386; and section 16A.386), while exercising the authorities and responsibilities of the board.

Paragraph (b) states that upon the establishment of required bylaws, policies, and procedures, all personnel, assets, contracts, obligations, and funds managed by the Marketplace shall be transferred to the board and existing personnel managed by the Commissioner of Management and Budget shall staff the board upon enactment.

Section 15 states that the Commissioner of Commerce, in consultation with the Board of Directors of the Minnesota Comprehensive Health Association (MCHA), has the authority to develop and implement the phase out and eventual termination of coverage provided by MCHA, beginning no sooner than January 1, 2014, or upon the effective date of the operation of the Minnesota Insurance Marketplace, whichever is later, and that the plan must ensure the least amount of disruption to the enrollees' health coverage.  Member assessments established under section 62E.11 shall take into consideration any phase out of coverage implemented under this section.

Section 16 requires the board to submit a report to the legislature on the appeals process for eligibility determinations that the board is required to establish under section 62V.05, subdivision 6.

Section 17 requires the Minnesota Insurance Marketplace to take necessary action regarding multiemployer health plans on or after the date that final federal regulations are adopted regarding the treatment of multiemployer plans to:  (1) ensure that multiemployer plans are notified of the final federal rules; (2) conform policies and procedures to the federal rules; and (3) permit multiemployer plans to participate in the Marketplace to the extent permitted by federal rules.

Section 18 states that this act is effective the day following final enactment, and that any actions taken by state agencies in the furtherance of the design, development, and implementation of the Marketplace prior to the effective date shall be considered actions taken by the Marketplace.  This section also states that health plan and dental plan coverage through the Marketplace is effective January 1, 2014.

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