1.1 	A bill for an act
1.2 	relating to insurance; creating the Minnesota comprehensive health plan; 
1.3 	requiring all health carriers and employers to offer the basic health plan; 
1.4 	phasing in the state public health programs into the basic health plan;amending 
1.5 	Minnesota Statutes 2006, sections 62A.65, subdivisions 1, 6; 62L.08, subdivision 
1.6 	1; proposing coding for new law in Minnesota Statutes, chapter 62A.
1.7 	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

1.8 	Section 1. Minnesota Statutes 2006, section 62A.65, subdivision 1, is amended to read:
1.9 		Subdivision 1.Applicability. No health carrier, as defined in section 62A.011, shall 
1.10 	offer, sell, issue, or renew any individual health plan, as defined in section 62A.011, to a 
1.11 	Minnesota resident except in compliance with this section or section 62A.68. This section 
1.12 	does not apply to the Comprehensive Health Association established in section 62E.10. 

1.13 	Sec. 2. Minnesota Statutes 2006, section 62A.65, subdivision 6, is amended to read:
1.14 		Subd. 6.Guaranteed issue not required. Nothing in this section requires a 
1.15 	health carrier to initially issue a health plan to a Minnesota resident, except as otherwise 
1.16 	expressly provided in subdivision 4 or 5 and section 62A.68.

1.17 	Sec. 3. [62A.68] MINNESOTA COMPREHENSIVE HEALTH PLAN.
1.18 		Subdivision 1.Required offering. (a) All health carriers shall offer a health 
1.19 	plan that is designated as the Minnesota comprehensive health plan that satisfies all 
1.20 	requirements of this section. Health carriers may offer additional health plans, in addition 
1.21 	to the comprehensive health plan, to the extent otherwise authorized by law.
1.22 	(b) All employers subject to chapter 268 must offer the comprehensive health plan 
1.23 	to their employees. Employers that are required to offer the comprehensive health plan 
2.1 	shall establish a Section 125 Plan to allow their employees to purchase the comprehensive 
2.2 	health plan for themselves and their dependents with pretax dollars. Nothing in this section 
2.3 	requires employers to purchase group health insurance coverage for their employees. For 
2.4 	purposes of this section, a "Section 125 Plan" means a cafeteria or premium-only plan 
2.5 	under section 125 of the Internal Revenue Code that allows employees to pay for health 
2.6 	insurance premiums with pretax dollars.
2.7 		Subd. 2.Covered services. The comprehensive health plan must include, at a 
2.8 	minimum, the services provided under a number three qualified plan as described in 
2.9 	section 62E.06. The basic health plan must include all benefits required by law.
2.10 		Subd. 3.Coinsurance. The comprehensive health plan shall cover, at a minimum, 
2.11 	80 percent of the cost of the covered services in excess of an annual deductible.
2.12 		Subd. 4.Maximum deductible. The comprehensive health plan shall not include 
2.13 	an annual deductible that exceeds $2,000 per individual and $4,000 per family.
2.14 		Subd. 5.Out-of-pocket maximum. The total annual out-of-pocket expenses for the 
2.15 	comprehensive health plan shall not exceed $5,000 per individual and $10,000 per family.
2.16 		Subd. 6.Lifetime maximum benefit. The comprehensive health plan shall not 
2.17 	include a lifetime maximum benefit.
2.18 		Subd. 7.Guaranteed issue. Notwithstanding section 62L.12, the comprehensive 
2.19 	health plan shall be offered to any individual on a guaranteed issue basis.
2.20 		Subd. 8.Premiums. (a) Notwithstanding sections 62A.65 and 62L.08, the 
2.21 	comprehensive health plan shall not determine premium rates through a method that is in 
2.22 	any way based upon the gender, the health status, age, occupation, or geographic area of 
2.23 	the individual or eligible employee or dependents.
2.24 	(b) The premiums shall be the same to all enrollees regardless of whether it is 
2.25 	purchased through the individual health plan market or through an employer.
2.26 		Subd. 9.MCHA and premium tax. The premiums paid to health carriers for the 
2.27 	comprehensive health plan are not subject to the taxes imposed under chapter 297I and to 
2.28 	a Minnesota Comprehensive Health Association assessment under section 62E.11.
2.29 		Subd. 10.Risk adjustment. The commissioner of commerce shall establish and 
2.30 	administer a risk-adjustment mechanism to spread the risk of high-cost enrollees enrolled 
2.31 	in the comprehensive health plan across all the health carriers.
2.32 		Subd. 11.Penalty. (a) Beginning January 1, 2010, one percent of the gross annual 
2.33 	premiums of each health carrier required to offer the basic health plan under this section 
2.34 	must be premiums from the basic health plan.
3.1 	(b) If the premium requirement of paragraph (a) is not met by the health carrier, the 
3.2 	health carrier shall be assessed an amount equal to .05 percent of the health carrier's gross 
3.3 	premium minus the amount of premiums that were attributable to the basic health plan.
3.4 	(c) The commissioner of commerce shall calculate any assessments owed and shall 
3.5 	establish a mechanism to collect the assessments. All assessments collected shall be 
3.6 	deposited to the health care access fund.

3.7 	Sec. 4. Minnesota Statutes 2006, section 62L.08, subdivision 1, is amended to read:
3.8 		Subdivision 1.Rate restrictions. Premium rates for all health benefit plans sold or 
3.9 	issued to small employers are subject to the restrictions specified in this section except 
3.10 	as otherwise expressly authorized under section 62A.68.

3.11 	Sec. 5. STATE HEALTH CARE PROGRAMS.
 3.12 		Subdivision 1.Consolidation plan. The commissioners of human services, 
3.13 	commerce, and health shall prepare a report for implementing the health care reforms 
3.14 	specified in this act. The report must be submitted to the legislature by January 15, 2009. 
3.15 	The report shall include a plan, budget, timeline, and proposed legislation to consolidate 
3.16 	and reform medical assistance, general assistance medical care, and the MinnesotaCare 
3.17 	program. Under the reformed system, the medical assistance program will continue to 
3.18 	provide health coverage for the elderly and disabled. Individuals and families, who are 
3.19 	currently eligible for a state health care program, will receive a voucher to purchase 
3.20 	the Minnesota comprehensive health plan described in Minnesota Statutes, section 
3.21 	62A.68. The amount of the voucher shall be based on income and family size and shall be 
3.22 	determined according to criteria developed by the commissioners. The voucher may be 
3.23 	used for both individual and group policies.
3.24 		Subd. 2.Purchasing pool. (a) The report shall include the establishment of a public 
3.25 	corporation that will offer the Minnesota comprehensive health plan to individuals and 
3.26 	families that do not have access to employer-subsidized health coverage. The purchasing 
3.27 	pool shall include a risk-adjustment mechanism that will assign high-cost enrollees to a 
3.28 	health carrier in order to spread the risk of these enrollees across the health carriers.
3.29 	(b) The report shall include a transition process for phasing out the Minnesota 
3.30 	Comprehensive Health Association.
3.31 		Subd. 3.Federal waivers. The commissioner of human services shall seek 
3.32 	authorization from the federal government to implement this act in the form of waivers 
3.33 	or federal legislation. The commissioner shall seek appropriate federal approval to offer 
4.1 	a benefits plan that incorporates premiums and co-payments to the extent allowable 
4.2 	under federal law.