1.1                          A bill for an act 
  1.2             relating to insurance; modifying regulation of joint 
  1.3             self-insurance employee benefit plans; amending 
  1.4             Minnesota Statutes 2002, sections 62H.01; 62H.02; 
  1.5             repealing Minnesota Statutes 2002, section 62H.07. 
  1.6   BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  1.7      Section 1.  Minnesota Statutes 2002, section 62H.01, is 
  1.8   amended to read: 
  1.9      62H.01 [AUTHORITY TO JOINTLY SELF-INSURE.] 
  1.10     Any two or more employers, excluding the state and its 
  1.11  political subdivisions as described in section 471.617, 
  1.12  subdivision 1, who are authorized to transact business in 
  1.13  Minnesota may jointly self-insure employee health, dental, 
  1.14  short-term disability benefits, or other benefits permitted 
  1.15  under the Employee Retirement Income Security Act of 1974, 
  1.16  United States Code, title 29, sections 1001 et seq.  If an 
  1.17  employer chooses to jointly self-insure in accordance with this 
  1.18  chapter, the employer must participate in the joint plan for at 
  1.19  least three consecutive years.  If an employer terminates 
  1.20  participation in the joint plan before the conclusion of this 
  1.21  three-year period, a financial penalty may be assessed under the 
  1.22  joint plan, not to exceed the amount contributed by the employer 
  1.23  to the plan's reserves as determined under Minnesota Rules, part 
  1.24  2765.1200.  Joint plans must have a minimum of 1,000 covered 
  1.25  employees and meet all conditions and terms of sections 62H.01 
  2.1   to 62H.08.  Joint plans covering employers not resident in 
  2.2   Minnesota must meet the requirements of sections 62H.01 to 
  2.3   62H.08 as if the portion of the plan covering Minnesota resident 
  2.4   employees was treated as a separate plan.  A plan may cover 
  2.5   employees resident in other states only if the plan complies 
  2.6   with the applicable laws of that state. 
  2.7      A multiple employer welfare arrangement as defined in 
  2.8   United States Code, title 29, section 1002(40)(a), is subject to 
  2.9   this chapter to the extent authorized by the Employee Retirement 
  2.10  Income Security Act of 1974, United States Code, title 29, 
  2.11  sections 1001 et seq.  The commissioner of commerce may, on 
  2.12  behalf of the state, enter into an agreement with the United 
  2.13  States Secretary of Labor for delegation to the state of some or 
  2.14  all of the secretary's enforcement authority with respect to 
  2.15  multiple employer welfare arrangements, as described in United 
  2.16  States Code, title 29, section 1136(c). 
  2.17     Sec. 2.  Minnesota Statutes 2002, section 62H.02, is 
  2.18  amended to read: 
  2.19     62H.02 [REQUIRED PROVISIONS.] 
  2.20     A joint self-insurance plan must include aggregate excess 
  2.21  stop-loss coverage and individual excess stop-loss coverage 
  2.22  provided by an insurance company licensed by the state of 
  2.23  Minnesota.  Aggregate Excess stop-loss coverage must include 
  2.24  provisions to cover incurred, unpaid claim liability in the 
  2.25  event of plan termination.  In addition, the plan of 
  2.26  self-insurance must have participating employers fund an amount 
  2.27  at least equal to the point at which the excess or stop-loss 
  2.28  insurer has contracted to assume 100 percent of additional 
  2.29  liability.  A joint self-insurance plan must submit its proposed 
  2.30  excess or stop-loss insurance contract to the commissioner of 
  2.31  commerce at least 30 days prior to the proposed plan's effective 
  2.32  date and at least 30 days subsequent to any renewal date.  The 
  2.33  commissioner shall review the contract to determine if they meet 
  2.34  the standards established by sections 62H.01 to 62H.08 and 
  2.35  respond within a 30-day period.  Any excess or stop-loss 
  2.36  insurance plan must contain a provision that the excess or 
  3.1   stop-loss insurer will give the plan and the commissioner of 
  3.2   commerce a minimum of 180 days' notice of termination or 
  3.3   nonrenewal.  If the plan fails to secure replacement coverage 
  3.4   within 60 days after receipt of the notice of cancellation or 
  3.5   nonrenewal, the commissioner shall issue an order providing for 
  3.6   the orderly termination of the plan. 
  3.7      Sec. 3.  [REPEALER.] 
  3.8      Minnesota Statutes 2002, section 62H.07, is repealed.