The State Legislature has just passed a major health insurance reform bill to address the near collapse of the state's individual health insurance market. The Governor is expected to sign the bill shortly.
There are two major portions of the new law. The first is the establishment of a premium assistance program that will award a 25% premium subsidy to individuals who have purchased insurance in the individual market and have not qualified for public subsidies. This includes qualified health insurance purchased through MNsure as well as the private market. The legislature accepted the Governor's proposal that does not tie the rebate to income.
he state will provide the funding for the 25% rebates directly to health plans that will use the subsidy to lower individual premiums. The legislature has appropriated $311,788,000 from the budget reserve for the program and health plans will submit invoices with supporting documentation to the state to receive funding.
The program will not be up and running most likely until April. However, monthly premium assistance will be retroactive to cover all premiums paid in 2017. The rebates are only for 2017 premiums. If the $311 million is not sufficient, the state will reduce the premium subsidy percentage beginning in September.
The second portion of the bill contains a series of health insurance reforms many of which were sponsored by Republican legislative leaders. Here are the major items of interest.
Allows for-profit HMOs in our state. The 1974 law that established our MHO regulations required all HMOs to be not-for-profit.
Makes it easier for small employers to self insure: sets the stop loss attachment point for all groups at no less than 110% of expected claims, requires stop loss no less favorable than claims during the contract period and claims paid within three months after the contract period's expiration.
Allows a health carrier to issue an individual plan to an employee of a small employer if the small employer is in compliance with the federal 21st Century Cures Act.
Requires the Commissioner of Commerce to make proposed insurance rates public within 10 business days of their submission by state health plans.
Establishes a continuity of care program that applies to policyholders who were unable to renew their existing coverage because the health plan policy was no longer available. This is referred to as "involuntary termination". If an individual who as a specific acute condition can no longer receive care from their provider because that provider is now out-of-network, the health plan must cover the services performed by that provider. The state will pay the health plan to reimburse the cost of these services. The new law appropriates $15 million from the budget reserve to cover these payments. The following conditions qualify; an acute condition, life threatening or a serious mental or physical illness or disability, pregnancy beyond the first trimester, or a disabling or chronic condition in a acute phase for up to 120 days. Out-of-network care would be covered for the contract period if a physician certifies that the person has an expected lifetime of 180 days or less.
Authorizes agricultural cooperative health plans for farmers, their family and employees. Requires stop-loss and reserves, a single risk pool, and exemptions from state mandated benefits. Brokers are authorized to market the cooperative. In order to participate, a member must enroll in the plan for three years.
Addresses surprise billing that occurs when a patient goes to their in-network hospital or medical clinic and an out-of-network provider, i.e. an anesthesiologist or pathologist, is brought in for ancillary services and in which the patient is later billed for these out-of-network services. The law will limit the patients exposure to the deductible and co-pays required for in-network care. The health plan and out-of-network provider will then negotiate the appropriate reimbursement. If an agreement cannot be reached, the provider and plan will go to arbitration.