1.1                          A bill for an act 
  1.2             relating to health; providing patient protections; 
  1.3             amending Minnesota Statutes 2000, sections 45.027, 
  1.4             subdivision 6; 62D.17, subdivision 1; 62J.38; 62M.02, 
  1.5             subdivision 21; 62Q.56; and 62Q.58; proposing coding 
  1.6             for new law in Minnesota Statutes, chapter 62Q. 
  1.7   BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  1.8      Section 1.  Minnesota Statutes 2000, section 45.027, 
  1.9   subdivision 6, is amended to read: 
  1.10     Subd. 6.  [VIOLATIONS AND PENALTIES.] The commissioner may 
  1.11  impose a civil penalty not to exceed $10,000 per violation upon 
  1.12  a person who violates any law, rule, or order related to the 
  1.13  duties and responsibilities entrusted to the commissioner unless 
  1.14  a different penalty is specified.  If a civil penalty is imposed 
  1.15  on a health carrier as defined in section 62A.011, the 
  1.16  commissioner must divide 50 percent of the amount among any 
  1.17  policy holders or certificate holders affected by the violation, 
  1.18  unless the commissioner certifies in writing that the division 
  1.19  and distribution to enrollees would be too administratively 
  1.20  complex or that the number of enrollees affected by the penalty 
  1.21  would result in a distribution of less than $50 per enrollee.  
  1.22     Sec. 2.  Minnesota Statutes 2000, section 62D.17, 
  1.23  subdivision 1, is amended to read: 
  1.24     Subdivision 1.  [ADMINISTRATIVE PENALTY.] The commissioner 
  1.25  of health may, for any violation of statute or rule applicable 
  1.26  to a health maintenance organization, or in lieu of suspension 
  2.1   or revocation of a certificate of authority under section 
  2.2   62D.15, levy an administrative penalty in an amount up to 
  2.3   $25,000 for each violation.  In the case of contracts or 
  2.4   agreements made pursuant to section 62D.05, subdivisions 2 to 4, 
  2.5   each contract or agreement entered into or implemented in a 
  2.6   manner which violates sections 62D.01 to 62D.30 shall be 
  2.7   considered a separate violation.  In determining the level of an 
  2.8   administrative penalty, the commissioner shall consider the 
  2.9   following factors: 
  2.10     (1) the number of enrollees affected by the violation; 
  2.11     (2) the effect of the violation on enrollees' health and 
  2.12  access to health services; 
  2.13     (3) if only one enrollee is affected, the effect of the 
  2.14  violation on that enrollee's health; 
  2.15     (4) whether the violation is an isolated incident or part 
  2.16  of a pattern of violations; and 
  2.17     (5) the economic benefits derived by the health maintenance 
  2.18  organization or a participating provider by virtue of the 
  2.19  violation. 
  2.20     Reasonable notice in writing to the health maintenance 
  2.21  organization shall be given of the intent to levy the penalty 
  2.22  and the reasons therefor, and the health maintenance 
  2.23  organization may have 15 days within which to file a written 
  2.24  request for an administrative hearing and review of the 
  2.25  commissioner of health's determination.  Such administrative 
  2.26  hearing shall be subject to judicial review pursuant to chapter 
  2.27  14.  If an administrative penalty is levied, the commissioner 
  2.28  must divide 50 percent of the amount among any enrollees 
  2.29  affected by the violation, unless the commissioner certifies in 
  2.30  writing that the division and distribution to enrollees would be 
  2.31  too administratively complex or that the number of enrollees 
  2.32  affected by the penalty would result in a distribution of less 
  2.33  than $50 per enrollee. 
  2.34     Sec. 3.  Minnesota Statutes 2000, section 62J.38, is 
  2.35  amended to read: 
  2.36     62J.38 [COST CONTAINMENT DATA FROM GROUP PURCHASERS.] 
  3.1      (a) The commissioner shall require group purchasers to 
  3.2   submit detailed data on total health care spending for each 
  3.3   calendar year.  Group purchasers shall submit data for the 1993 
  3.4   calendar year by April 1, 1994, and each April 1 thereafter 
  3.5   shall submit data for the preceding calendar year. 
  3.6      (b) The commissioner shall require each group purchaser to 
  3.7   submit data on revenue, expenses, and member months, as 
  3.8   applicable.  Revenue data must distinguish between premium 
  3.9   revenue and revenue from other sources and must also include 
  3.10  information on the amount of revenue in reserves and changes in 
  3.11  reserves.  Expenditure data~~, including raw data from claims, may~~ 
  3.12  must distinguish between payments made for patient care and 
  3.13  administrative costs.  Expenditure data must be provided 
  3.14  separately for the following categories ~~or~~ and for other 
  3.15  categories required by the commissioner:  physician services, 
  3.16  dental services, other professional services, inpatient hospital 
  3.17  services, outpatient hospital services, emergency, pharmacy 
  3.18  services and other nondurable medical goods, mental health, and 
  3.19  chemical dependency services, other expenditures, subscriber 
  3.20  liability, and administrative costs.  Administrative costs must 
  3.21  include costs for marketing; advertising; overhead; salaries and 
  3.22  benefits of central office staff who do not provide direct 
  3.23  patient care; underwriting; lobbying; claims processing; 
  3.24  provider contracting and credentialing; detection and prevention 
  3.25  of payment for fraudulent or unjustified requests for 
  3.26  reimbursement or services; clinical quality assurance and other 
  3.27  types of medical care quality improvement efforts; concurrent or 
  3.28  prospective utilization review as defined in section 62M.02; 
  3.29  payments made to acquire a hospital, clinic, or health care 
  3.30  facility, or the assets thereof; capital costs incurred on 
  3.31  behalf of a hospital or clinic; lease payments; or any other 
  3.32  payments made to a hospital, clinic, or other health care 
  3.33  provider pursuant to a partnership, joint venture, integration, 
  3.34  or affiliation agreement.  The reports of this data must also 
  3.35  separately identify expenses for local, state, and federal 
  3.36  taxes, fees, and assessments.  The commissioner may require each 
  4.1   group purchaser to submit any other data, including data in 
  4.2   unaggregated form, for the purposes of developing spending 
  4.3   estimates, setting spending limits, and monitoring actual 
  4.4   spending and costs. 
  4.5      (c) The commissioner may collect information on: 
  4.6      (1) premiums, benefit levels, managed care procedures, and 
  4.7   other features of health plan companies; 
  4.8      (2) prices, provider experience, and other information for 
  4.9   services less commonly covered by insurance or for which 
  4.10  patients commonly face significant out-of-pocket expenses; and 
  4.11     (3) information on health care services not provided 
  4.12  through health plan companies, including information on prices, 
  4.13  costs, expenditures, and utilization. 
  4.14     (d) All group purchasers shall provide the required data 
  4.15  using a uniform format and uniform definitions, as prescribed by 
  4.16  the commissioner. 
  4.17     Sec. 4.  Minnesota Statutes 2000, section 62M.02, 
  4.18  subdivision 21, is amended to read: 
  4.19     Subd. 21.  [UTILIZATION REVIEW ORGANIZATION.] "Utilization 
  4.20  review organization" means an entity including but not limited 
  4.21  to an insurance company licensed under chapter 60A to offer, 
  4.22  sell, or issue a policy of accident and sickness insurance as 
  4.23  defined in section 62A.01; a health service plan licensed under 
  4.24  chapter 62C; a health maintenance organization licensed under 
  4.25  chapter 62D; a community integrated service network licensed 
  4.26  under chapter 62N; an accountable provider network operating 
  4.27  under chapter 62T; a fraternal benefit society operating under 
  4.28  chapter 64B; a joint self-insurance employee health plan 
  4.29  operating under chapter 62H; a multiple employer welfare 
  4.30  arrangement, as defined in section 3 of the Employee Retirement 
  4.31  Income Security Act of 1974 (ERISA), United States Code, title 
  4.32  29, section 1103, as amended; a third party administrator 
  4.33  licensed under section 60A.23, subdivision 8, which conducts 
  4.34  utilization review and determines certification of an admission, 
  4.35  extension of stay, or other health care services for a Minnesota 
  4.36  resident; or any entity performing utilization review that is 
  5.1   affiliated with, under contract with, or conducting utilization 
  5.2   review on behalf of, a business entity in this state.  
  5.3   Utilization review organization does not include a clinic or 
  5.4   health care system acting pursuant to a written delegation 
  5.5   agreement with an otherwise regulated utilization review 
  5.6   organization that contracts with the clinic or health care 
  5.7   system.  The regulated utilization review organization is 
  5.8   accountable for the delegated utilization review activities of 
  5.9   the clinic or health care system. 
  5.10     Sec. 5.  Minnesota Statutes 2000, section 62Q.56, is 
  5.11  amended to read: 
  5.12     62Q.56 [CONTINUITY OF CARE.] 
  5.13     Subdivision 1.  [CHANGE IN HEALTH CARE PROVIDER.] (a) If 
  5.14  enrollees are required to access services through selected 
  5.15  primary care providers for coverage, the health plan company 
  5.16  shall prepare a written plan that provides for continuity of 
  5.17  care in the event of contract termination between the health 
  5.18  plan company and any of the contracted primary or secondary care 
  5.19  providers or general hospital providers.  For purposes of this 
  5.20  section, termination includes nonrenewal.  The written plan must 
  5.21  explain: 
  5.22     (1) how the health plan company will inform affected 
  5.23  enrollees~~, insureds, or beneficiaries~~ about termination at least 
  5.24  30 days before the termination is effective, if the health plan 
  5.25  company or health care network cooperative has received at least 
  5.26  120 days' prior notice; 
  5.27     (2) how the health plan company will inform the affected 
  5.28  enrollees about what other participating providers are available 
  5.29  to assume care and how it will facilitate an orderly transfer of 
  5.30  its enrollees from the terminating provider to the new provider 
  5.31  to maintain continuity of care; 
  5.32     (3) the procedures by which enrollees will be transferred 
  5.33  to other participating providers, when special medical needs, 
  5.34  special risks, or other special circumstances, such as cultural 
  5.35  or language barriers, require them to have a longer transition 
  5.36  period or be transferred to nonparticipating providers; 
  6.1      (4) who will identify enrollees with special medical needs 
  6.2   or at special risk and what criteria will be used for this 
  6.3   determination; and 
  6.4      (5) how continuity of care will be provided for enrollees 
  6.5   identified as having special needs or at special risk, and 
  6.6   whether the health plan company has assigned this responsibility 
  6.7   to its contracted primary care providers. 
  6.8      (b) If the contract termination was not for cause~~,~~ 
  6.9   ~~enrollees can request a referral to the terminating provider for~~ 
  6.10  ~~up to 120 days if they have special medical needs or have other~~ 
  6.11  ~~special circumstances, such as cultural or language barriers.~~  
  6.12  ~~The health plan company can require medical records and other~~ 
  6.13  ~~supporting documentation in support of the requested referral.~~  
  6.14  ~~Each request for referral to a terminating provider shall be~~ 
  6.15  ~~considered by the health plan company on a case-by-case basis.~~: 
  6.16     (1) if the contract was terminated by the health plan 
  6.17  company, the terminated provider and all enrollees being treated 
  6.18  by that provider must be notified of the enrollees' rights to 
  6.19  continuity of care with the terminated provider; 
  6.20     (2) the health plan company must provide, upon request, 
  6.21  authorization to receive services that are otherwise covered 
  6.22  under the terms of the health plan through the enrollee's 
  6.23  current provider for up to 120 days if the enrollee is engaged 
  6.24  in a current course of treatment for one or more of the 
  6.25  following conditions: 
  6.26     (i) an acute condition; 
  6.27     (ii) a life-threatening mental or physical illness; 
  6.28     (iii) pregnancy beyond the first trimester of pregnancy; 
  6.29     (iv) a degenerative disease or disability; or 
  6.30     (v) a disabling or chronic condition that is in an acute 
  6.31  phase; and 
  6.32     (3) the health plan company must provide, upon request, 
  6.33  authorization to receive services that are otherwise covered 
  6.34  under the terms of the health plan through the enrollee's 
  6.35  current provider for the rest of the enrollee's life if a 
  6.36  physician certifies that the enrollee has an expected lifetime 
  7.1   of 180 days or less.  
  7.2   For all requests for authorization to receive services under 
  7.3   this paragraph, the health plan company must grant the request 
  7.4   unless the enrollee does not meet the criteria provided in this 
  7.5   paragraph. 
  7.6      (c) The health plan company shall prepare a written plan 
  7.7   that provides a process for coverage determinations regarding 
  7.8   continuity of care of up to 120 days for enrollees who request 
  7.9   continuity of care with their former provider, if the enrollee: 
  7.10     (1) is receiving culturally appropriate services and the 
  7.11  health plan company does not have a provider in its preferred 
  7.12  provider network with special expertise in the delivery of those 
  7.13  culturally appropriate services within the time and distance 
  7.14  requirements of section 62D.124, subdivision 1; or 
  7.15     (2) does not speak English and the health plan company does 
  7.16  not have a provider in its preferred provider network who can 
  7.17  communicate with the enrollee, either directly or through an 
  7.18  interpreter, within the time and distance requirements of 
  7.19  section 62D.124, subdivision 1. 
  7.20  The written plan must explain the criteria that will be used to 
  7.21  determine whether a need for continuity of care exists and how 
  7.22  it will be provided. 
  7.23     (d) This paragraph applies to requests under paragraph (b) 
  7.24  or (c).  The health plan company may require medical records and 
  7.25  other supporting documentation to be submitted with the request 
  7.26  for authorization.  The health plan company must explain the 
  7.27  criteria it used to make its decision on the request for 
  7.28  authorization.  If an authorization is granted, the health plan 
  7.29  company must explain how continuity of care will be provided.  
  7.30     ~~(c)~~ (e) If the contract termination was for cause, 
  7.31  enrollees must be notified of the change and transferred to 
  7.32  participating providers in a timely manner so that health care 
  7.33  services remain available and accessible to the affected 
  7.34  enrollees.  The health plan company is not required to refer an 
  7.35  enrollee back to the terminating provider if the termination was 
  7.36  for cause. 
  8.1      Subd. 2.  [CHANGE IN HEALTH PLANS.] (a) ~~The health plan~~ 
  8.2   ~~company shall prepare a written plan that provides a process for~~ 
  8.3   ~~coverage determinations for continuity of care for new enrollees~~ 
  8.4   ~~with special needs, special risks, or other special~~ 
  8.5   ~~circumstances, such as cultural or language barriers, who~~ 
  8.6   ~~request continuity of care with their former provider for up to~~ 
  8.7   ~~120 days.  The written plan must explain the criteria that will~~ 
  8.8   ~~be used for determining special needs cases, and how continuity~~ 
  8.9   ~~of care will be provided.~~  If an enrollee is subject to a change 
  8.10  in health plans, the enrollee's new health plan company must 
  8.11  provide, upon request, authorization to receive services that 
  8.12  are otherwise covered under the terms of the new health plan 
  8.13  through the enrollee's current provider for up to 120 days if 
  8.14  the enrollee is engaged in a current course of treatment for one 
  8.15  or more of the following conditions: 
  8.16     (1) an acute condition; 
  8.17     (2) a life-threatening mental or physical illness; 
  8.18     (3) pregnancy beyond the first trimester of pregnancy; 
  8.19     (4) a degenerative disease or disability; or 
  8.20     (5) a disabling or chronic condition that is in an acute 
  8.21  phase.  
  8.22  For all requests for authorization under this paragraph, the 
  8.23  health plan company must grant the request for authorization 
  8.24  unless the enrollee does not meet the criteria provided in this 
  8.25  paragraph. 
  8.26     (b) The health plan company shall prepare a written plan 
  8.27  that provides a process for coverage determinations regarding 
  8.28  continuity of care of up to 120 days for new enrollees who 
  8.29  request continuity of care with their former provider, if the 
  8.30  new enrollee: 
  8.31     (1) is receiving culturally appropriate services and the 
  8.32  health plan company does not have a provider in its preferred 
  8.33  provider network with special expertise in the delivery of those 
  8.34  culturally appropriate services within the time and distance 
  8.35  requirements of section 62D.124, subdivision 1; or 
  8.36     (2) does not speak English and the health plan company does 
  9.1   not have a provider in its preferred provider network who can 
  9.2   communicate with the enrollee, either directly or through an 
  9.3   interpreter, within the time and distance requirements of 
  9.4   section 62D.124, subdivision 1. 
  9.5   The written plan must explain the criteria that will be used to 
  9.6   determine whether a need for continuity of care exists and how 
  9.7   it will be provided. 
  9.8      (c) This paragraph applies to requests under paragraph (a) 
  9.9   or (b).  The health plan company may require medical records and 
  9.10  other supporting documentation to be submitted with the request 
  9.11  for authorization.  The health plan company must explain the 
  9.12  criteria it used to make its decision on the request for 
  9.13  authorization.  If an authorization is granted, the health plan 
  9.14  company must explain how continuity of care will be provided.  
  9.15     ~~(b)~~ (d) This subdivision applies only to group coverage and 
  9.16  continuation and conversion coverage, and applies only to 
  9.17  changes in health plans made by the employer. 
  9.18     Subd. 2a.  [LIMITATIONS.] (a) Subdivisions 1 and 2 apply 
  9.19  only if the enrollee's health care provider agrees to: 
  9.20     (1) accept as payment in full the lesser of the health plan 
  9.21  company's reimbursement rate for in-network providers for the 
  9.22  same or similar service or the enrollee's health care provider's 
  9.23  regular fee for that service; 
  9.24     (2) adhere to the health plan company's preauthorization 
  9.25  requirements; and 
  9.26     (3) provide the health plan company with all necessary 
  9.27  medical information related to the care provided to the enrollee.
  9.28     (b) Nothing in this section requires a health plan company 
  9.29  to provide coverage for a health care service or treatment that 
  9.30  is not covered under the enrollee's health plan.  
  9.31     Subd. 3.  [~~DISCLOSURES~~ DISCLOSURE.] ~~The written plans~~ 
  9.32  ~~required under this section must be made available upon request~~ 
  9.33  ~~to enrollees or prospective enrollees~~ Information regarding an 
  9.34  enrollee's rights under this section must be included in member 
  9.35  contracts or certificates of coverage and must be provided by a 
  9.36  health plan company upon request of an enrollee or prospective 
 10.1   enrollee. 
 10.2      Sec. 6.  Minnesota Statutes 2000, section 62Q.58, is 
 10.3   amended to read: 
 10.4      62Q.58 [ACCESS TO SPECIALTY CARE.] 
 10.5      Subdivision 1.  [STANDING REFERRAL.] A health plan company 
 10.6   shall establish a procedure by which an enrollee may apply 
 10.7   for and, if appropriate, receive a standing referral to a health 
 10.8   care provider who is a specialist if a referral to a specialist 
 10.9   is required for coverage.  This procedure for a standing 
 10.10  referral must specify the necessary ~~criteria and conditions,~~ 
 10.11  ~~which must be met in order for an enrollee to obtain a standing~~ 
 10.12  ~~referral~~ managed care review and approval an enrollee must 
 10.13  obtain before such a standing referral is permitted. 
 10.14     Subd. 1a.  [MANDATORY STANDING REFERRAL.] An enrollee who 
 10.15  requests a standing referral to a specialist qualified to treat 
 10.16  the specific condition described in clauses (1) to (5) must be 
 10.17  given a standing referral for visits to such a specialist if 
 10.18  benefits for such treatment are provided under the health plan 
 10.19  and the enrollee has any of the following conditions:  
 10.20     (1) a chronic health condition that is in an acute phase; 
 10.21     (2) a life-threatening mental or physical illness; 
 10.22     (3) pregnancy beyond the first trimester of pregnancy; 
 10.23     (4) a degenerative disease or disability; or 
 10.24     (5) any other condition or disease of sufficient 
 10.25  seriousness and complexity to require treatment by a specialist. 
 10.26     Subd. 2.  [COORDINATION OF SERVICES.] ~~A primary care~~ 
 10.27  ~~provider or primary care group shall remain responsible for~~ 
 10.28  ~~coordinating the care of an enrollee who has received a standing~~ 
 10.29  ~~referral to a specialist.  The specialist shall not make any~~ 
 10.30  ~~secondary referrals related to primary care services without~~ 
 10.31  ~~prior approval by the primary care provider or primary care~~ 
 10.32  ~~group.  However,~~ An enrollee with a standing referral to a 
 10.33  specialist may request primary care services from that 
 10.34  specialist.  The specialist, in agreement with the enrollee and 
 10.35  primary care provider or primary care group, may elect to 
 10.36  provide primary care services to ~~that~~ the enrollee, authorize 
 11.1   tests and services, and make secondary referrals according to 
 11.2   procedures established by the health plan company.  The health 
 11.3   plan company may limit the primary care services, tests and 
 11.4   services, and secondary referrals authorized under this 
 11.5   subdivision to those that are related to the specific condition 
 11.6   or conditions for which the standing referral was made. 
 11.7      Subd. 3.  [DISCLOSURE.] Information regarding referral 
 11.8   procedures must be included in member contracts or certificates 
 11.9   of coverage and must be provided to an enrollee or prospective 
 11.10  enrollee by a health plan company upon request. 
 11.11     Subd. 4.  [REFERRAL.] (a) If a standing referral is 
 11.12  authorized under subdivision 1 or is mandatory under subdivision 
 11.13  1a, the health plan company must provide a referral to an 
 11.14  appropriate participating specialist who is reasonably available 
 11.15  and accessible to provide the treatment or to a nonparticipating 
 11.16  specialist if the health plan company does not have an 
 11.17  appropriate participating specialist who is reasonably available 
 11.18  and accessible to treat the enrollee's condition or disease. 
 11.19     (b) If an enrollee receives services from a 
 11.20  nonparticipating specialist because a participating specialist 
 11.21  is not available, services must be provided at no additional 
 11.22  cost to the enrollee beyond what the enrollee would otherwise 
 11.23  pay for services received from a participating specialist. 
 11.24     Sec. 7.  [62Q.675] [BLANKET EXCLUSION FOR CLINICAL TRIAL 
 11.25  PARTICIPANTS PROHIBITED.] 
 11.26     Subdivision 1.  [EXCLUSION PROHIBITED.] A health plan must 
 11.27  not exclude coverage for otherwise covered services, or provide 
 11.28  for disenrollment of an enrollee, on the basis that the enrollee 
 11.29  is a participant in a clinical trial and a health plan company 
 11.30  must not refuse coverage for otherwise covered services or 
 11.31  disenroll an enrollee on that basis. 
 11.32     Subd. 2.  [COVERAGE OF CLINICAL TRIALS NOT REQUIRED.] 
 11.33  Subdivision 1 does not require a health plan to cover the costs 
 11.34  of the clinical trial. 
 11.35     Sec. 8.  [QUALITY OF PATIENT CARE.] 
 11.36     The commissioner of health shall evaluate the feasibility 
 12.1   of collecting data on the quality of patient care provided in 
 12.2   hospitals, outpatient surgical centers, and other health care 
 12.3   facilities.  In the evaluation, the commissioner shall examine 
 12.4   the appropriate roles of the public and private sectors and the 
 12.5   need for risk-adjusting data.  The evaluation must consider 
 12.6   mechanisms to identify the quality of nursing care provided to 
 12.7   consumers by examining variables such as skin breakdown and 
 12.8   patient injuries.  Any plan developed to collect data must also 
 12.9   address issues related to the release of the data in a useful 
 12.10  form to the public.  The commissioner shall prepare and 
 12.11  distribute a written report of the evaluation by January 15, 
 12.12  2002. 
 12.13     Sec. 9.  [EFFECTIVE DATE.] 
 12.14     Sections 1 and 2 are effective for violations committed on 
 12.15  or after August 1, 2001.  Section 3 is effective beginning with 
 12.16  the report for the 2001 calendar year.  Sections 4 and 8 are 
 12.17  effective the day following final enactment.  Sections 5 to 7 
 12.18  are effective August 1, 2001, and apply to health plans issued 
 12.19  or renewed on or after that date.