Supplemental health insurance product establishment to cover short-term home health and nursing care

A bill for an act

relating to insurance; establishing a supplemental health insurance product to cover

short-term home health and nursing care; providing civil penalties; amending

Minnesota Statutes 2024, sections 62A.135, subdivision 1; 62A.46, subdivision

2; 72A.13, subdivision 1; 256B.0913, subdivision 4; proposing coding for new

law in Minnesota Statutes, chapter 62A.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

Section 1.

Minnesota Statutes 2024, section 62A.135, subdivision 1, is amended to read:

Subdivision 1.

Definitions.

For purposes of this section, the following terms have the

meanings given
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them
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:

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(a)
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(1)
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"fixed indemnity policy" is a policy form, other than an accidental death and

dismemberment policy, a disability income policy, or a long-term care policy as defined in

section
62A.46, subdivision 2
, that pays a predetermined, specified, fixed benefit for services

provided.
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Fixed indemnity policy includes short-term home health and nursing care insurance

under section 62A.70.
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Claim costs under these forms are generally not subject to inflation,

although they may be subject to changes in the utilization of health care services. For policy

forms providing both expense-incurred and fixed benefits, the policy form is a fixed

indemnity policy if 50 percent or more of the total claims are for predetermined, specified,

fixed benefits;

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(b)
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(2)
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"guaranteed renewable" means that, during the renewal period (to a specified

age) renewal cannot be declined nor coverage changed by the insurer for any reason other

than nonpayment of premiums, fraud, or misrepresentation, but the insurer can revise rates

on a class basis upon approval by the commissioner;

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(c)
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(3)
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"noncancelable" means that, during the renewal period (to a specified age) renewal

cannot be declined nor coverage changed by the insurer for any reason other than nonpayment

of premiums, fraud, or misrepresentation and that rates cannot be revised by the insurer.

This includes policies that are guaranteed renewable to a specified age, such as 60 or 65, at

guaranteed rates; and

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(d)
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(4)
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"average annualized premium" means the average of the estimated annualized

premium per covered person based on the anticipated distribution of business using all

significant criteria having a price difference, such as age, sex, amount, dependent status,

mode of payment, and rider frequency. For filing of rate revisions, the amount is the

anticipated average assuming the revised rates have fully taken effect.

Sec. 2.

Minnesota Statutes 2024, section 62A.46, subdivision 2, is amended to read:

Subd. 2.

Long-term care policy.

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(a)
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"Long-term care policy" means an individual or

group policy, certificate, subscriber contract, or other evidence of coverage that provides

benefits for prescribed long-term care, including nursing facility services or home care

services, or both nursing facility services and home care services, pursuant to the

requirements of sections
62A.46
to
62A.56
.
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Long-term care policy does not include

short-term home health and nursing care insurance under section 62A.70.
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(b)
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Sections
62A.46
,
62A.48
, and
62A.52
to
62A.56
do not apply to a long-term care

policy issued to
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(a)
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(1)
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an employer or employers or to the trustee of a fund established by

an employer where only employees or retirees, and dependents of employees or retirees,

are eligible for coverage or
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(b)
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(2)
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to a labor union or similar employee organization.
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The

associations exempted from the requirements of sections
62A.3099
to
62A.44
under
62A.31,

subdivision 1
, clause (c) shall not be subject to the provisions of sections
62A.46
to
62A.56

until July 1, 1988.
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Sec. 3.

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[62A.70] SHORT-TERM HOME HEALTH AND NURSING CARE

INSURANCE.

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Subdivision 1.

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Definitions.

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(a) For purposes of this section, the following terms have

the meanings given.

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(b) "Activities of daily living" has the meaning given in section 62S.01, subdivision 2.

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(c) "Cognitive impairment" has the meaning given in section 62S.01, subdivision 9.

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(d) "Free-look period" means a period with a duration of at least 30 days, beginning the

date the policy, certificate, contract, or other evidence of coverage is issued and delivered

to the insured, during which an insured may cancel the policy, certificate, contract, or other

evidence of coverage and receive a full refund of all paid insurance premiums.

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(e) "Home health agency" has the meaning given in section 62A.46, subdivision 10.

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(f) "Insured" means a person covered under a short-term home health and nursing care

insurance policy.

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(g) "Nursing facility" has the meaning given in section 62A.46, subdivision 3.

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(h) "Plan of care" has the meaning given in section 62A.46, subdivision 8.

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(i) "Qualified insurer" means an entity licensed under chapter 62A or 62C.

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(j) "Short-term home health and nursing care insurance" means an individual or group

policy, certificate, subscriber contract, or other evidence of coverage that provides benefits

for short-term home health services or short-term nursing care services. Short-term home

health and nursing care insurance does not include:

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(1) a long-term care policy, as defined in section 62A.46, subdivision 2;

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(2) long-term care insurance, as defined in section 62S.01, subdivision 18;

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(3) Medicare supplement policies, as defined in section 62A.3099, subdivision 18; or

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(4) major medical, disability income, or hospital confinement indemnity policies.

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(k) "Short-term home health services" means one or more of the following services to

care for and treat an insured that are provided by a home health agency in a noninstitutional

setting pursuant to a written diagnosis or assessment and plan of care:

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(1) nursing and related personal care services under the direction of a registered nurse,

including the services of a home health aide;

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(2) physical therapy;

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(3) speech therapy;

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(4) respiratory therapy;

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(5) occupational therapy;

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(6) nutritional services provided by a licensed dietitian;

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(7) homemaker services, meal preparation, and similar nonmedical services;

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(8) medical social services; and

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(9) other similar medical services and health-related support services.

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(l) "Short-term nursing care services" means services to care for and treat an insured

that are provided by a nursing facility pursuant to a written diagnosis or assessment and

plan of care.

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(m) "Waiting period" means a specified time period that an insured must wait before

some or all of the insured's coverage becomes effective.

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Subd. 2.

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Short-term home health and nursing care insurance approval.

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(a) A qualified

insurer may offer, issue, deliver, and renew short-term home health and nursing care

insurance if the insurance meets the requirements of this section.

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(b) Short-term home health and nursing care insurance may be offered, issued, delivered,

or renewed only by a qualified insurer.

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(c) Short-term home health and nursing care insurance must not be offered, issued,

delivered, or renewed until the short-term home health and nursing care insurance is approved

by the commissioner as necessary under sections 62A.02 and 62A.135.

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Subd. 3.

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Policy requirements.

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(a) Short-term home health and nursing care insurance

must provide benefits upon:

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(1) cognitive impairment; or

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(2) the insured's inability to perform at least two activities of daily living without

substantial assistance.

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(b) Short-term home health and nursing care insurance must not provide coverage for a

period exceeding 360 days.

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(c) Short-term home health and nursing care insurance must provide a free-look period.

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(d) Short-term home health and nursing care insurance must not be canceled due to an

insured's deterioration in health status or use of benefits.

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(e) An insurer may deny the renewal of a policy, certificate, contract, or other evidence

of coverage of short-term home health and nursing care insurance only for:

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(1) nonpayment of a premium by the insured;

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(2) fraud or misrepresentation by the insured;

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(3) termination of the insurer's authority to transact business in the state; or

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(4) the insured's exhaustion of the maximum benefit period.

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(f) Upon the conversion or replacement by an insurer of a policy, certificate, contract,

or other evidence of coverage containing a waiting period, the insurer is prohibited from

establishing a waiting period that differs from the original waiting period.

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Subd. 4.

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Required disclosures.

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Short-term home health and nursing care insurance must

not be offered or issued without providing the following written disclosures:

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(1) a statement, in bold text, that the policy, certificate, contract, or other evidence of

coverage is supplemental health insurance; is not long-term care insurance; and is not a

policy under the Minnesota partnership for long-term care program;

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(2) a clear and understandable explanation of the free-look period; and

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(3) a clear and understandable explanation of all renewability and continuity provisions.

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Sec. 4.

Minnesota Statutes 2024, section 72A.13, subdivision 1, is amended to read:

Subdivision 1.

Penalties.

Any company, corporation, association, society, or other

insurer, or any officer or agent thereof, which or who solicits, issues or delivers to any

person in this state any policy in violation of the provisions of sections
60A.06, subdivision

3

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or
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,
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62A.01
to
62A.10
,
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or 62A.70
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may be punished by a fine of not more than $200 for

each offense, and the commissioner may revoke the license of any company, corporation,

association, society, or other insurer of another state or country, or of the agent thereof,

which or who willfully violates any provision of sections
60A.06, subdivision 3

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or
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,
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62A.01

to
62A.10
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, or 62A.70
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.

Sec. 5.

Minnesota Statutes 2024, section 256B.0913, subdivision 4, is amended to read:

Subd. 4.

Eligibility for funding for services for nonmedical assistance recipients.

(a)

Funding for services under the alternative care program is available to persons who meet

the following criteria:

(1) the person is a citizen of the United States or a United States national;

(2) the person has been determined by a community assessment under section
256B.0911

to be a person who would require the level of care provided in a nursing facility, as

determined under section
256B.0911, subdivision
26, but for the provision of services under

the alternative care program;

(3) the person is age 65 or older;

(4) the person would be eligible for medical assistance within 135 days of admission to

a nursing facility;

(5) the person is not ineligible for the payment of long-term care services by the medical

assistance program due to an asset transfer penalty under section
256B.0595
or equity

interest in the home exceeding $500,000 as stated in section
256B.056
;

(6) the person needs long-term care services that are not funded through other state or

federal funding, or other health insurance or other third-party insurance such as long-term

care insurance
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. For purposes of this clause, short-term home health and nursing care insurance

under section 62A.70 does not constitute health or other third-party insurance
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;

(7) except for individuals described in clause (8), the monthly cost of the alternative

care services funded by the program for this person does not exceed 75 percent of the

monthly limit described under section
256S.18
. This monthly limit does not prohibit the

alternative care client from payment for additional services, but in no case may the cost of

additional services purchased under this section exceed the difference between the client's

monthly service limit defined under section
256S.04
, and the alternative care program

monthly service limit defined in this paragraph. If care-related supplies and equipment or

environmental modifications and adaptations are or will be purchased for an alternative

care services recipient, the costs may be prorated on a monthly basis for up to 12 consecutive

months beginning with the month of purchase. If the monthly cost of a recipient's other

alternative care services exceeds the monthly limit established in this paragraph, the annual

cost of the alternative care services shall be determined. In this event, the annual cost of

alternative care services shall not exceed 12 times the monthly limit described in this

paragraph;

(8) for individuals assigned a case mix classification A as described under section

256S.18
, with (i) no dependencies in activities of daily living, or (ii) up to two dependencies

in bathing, dressing, grooming, walking, and eating when the dependency score in eating

is three or greater as determined by an assessment performed under section
256B.0911
, the

monthly cost of alternative care services funded by the program cannot exceed $593 per

month for all new participants enrolled in the program on or after July 1, 2011. This monthly

limit shall be applied to all other participants who meet this criteria at reassessment. This

monthly limit shall be increased annually as described in section
256S.18
. This monthly

limit does not prohibit the alternative care client from payment for additional services, but

in no case may the cost of additional services purchased exceed the difference between the

client's monthly service limit defined in this clause and the limit described in clause (7) for

case mix classification A;

(9) the person is making timely payments of the assessed monthly fee. A person is

ineligible if payment of the fee is over 60 days past due, unless the person agrees to:

(i) the appointment of a representative payee;

(ii) automatic payment from a financial account;

(iii) the establishment of greater family involvement in the financial management of

payments; or

(iv) another method acceptable to the lead agency to ensure prompt fee payments; and

(10) for a person participating in consumer-directed community supports, the person's

monthly service limit must be equal to the monthly service limits in clause (7), except that

a person assigned a case mix classification L must receive the monthly service limit for

case mix classification A.

(b) The lead agency may extend the client's eligibility as necessary while making

arrangements to facilitate payment of past-due amounts and future premium payments.

Following disenrollment due to nonpayment of a monthly fee, eligibility shall not be

reinstated for a period of 30 days.

(c) Alternative care funding under this subdivision is not available for a person who is

a medical assistance recipient or who would be eligible for medical assistance without a

spenddown or waiver obligation. A person whose initial application for medical assistance

and the elderly waiver program is being processed may be served under the alternative care

program for a period up to 60 days. If the individual is found to be eligible for medical

assistance, medical assistance must be billed for services payable under the federally

approved elderly waiver plan and delivered from the date the individual was found eligible

for the federally approved elderly waiver plan. Notwithstanding this provision, alternative

care funds may not be used to pay for any service the cost of which: (i) is payable by medical

assistance; (ii) is used by a recipient to meet a waiver obligation; or (iii) is used to pay a

medical assistance income spenddown for a person who is eligible to participate in the

federally approved elderly waiver program under the special income standard provision.

(d) Alternative care funding is not available for a person who resides in a licensed nursing

home, certified boarding care home, hospital, or intermediate care facility, except for case

management services which are provided in support of the discharge planning process for

a nursing home resident or certified boarding care home resident to assist with a relocation

process to a community-based setting.

(e) Alternative care funding is not available for a person whose income is greater than

the maintenance needs allowance under section
256S.05
, but equal to or less than 120 percent

of the federal poverty guideline effective July 1 in the fiscal year for which alternative care

eligibility is determined, who would be eligible for the elderly waiver with a waiver

obligation.